Ludwig Von Mises's Approach to Capital as a Bridge between Austrian and Institutional Economics

Abstract

Ludwig von Mises seems to be something of an outlier within the Austrian school when it comes to capital – though his position is clearly foreshadowed in a neglected article by Carl Menger (1888). In this paper we examine Mises’s view on capital and suggest that it constitutes a bridge between Austrian and institutional economics. As an outflow of Mises’s approach, an incipient financial approach may be discerned, an approach to capital that integrates concepts from financial theory into a broader view of capital that contains both institutional and Austrian elements.

Keywords: Theory of capital; Capitalism; Historically specific institutions; Monetary calculation

JEL Classification: B52, B53, D24, P10