Austrian school of economics

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The Austrian school of economics is a heterodox school of economic thought that advocates strict adherence to methodological individualism, which is the theory that social phenomena result primarily from the actions of individuals, each motivated by their own self-interest. Austrian-school theorists hold that economic theory should be exclusively derived from basic axioms of human action, known as praxeology, rather than primarily from statistical analysis. The Austrian school originated in 1871 in Vienna with the work of Carl Menger, Eugen von Böhm-Bawerk, Friedrich von Wieser, and others. It was methodologically opposed to the Historical school, in a dispute known as Methodenstreit, or methodology quarrel. Current-day economists working in this tradition are located in many countries, but their work is still referred to as Austrian economics. Among the theoretical contributions of the early years of the Austrian school are the subjective theory of value, marginalism in price theory,...

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