The Austrian Free Enterprise Ethic: A Mengerian Comment on Kirzner (2019)

Abstract

Kirzner (2019) develops an Austrian perspective to critique Friedman’s universal ethic for profit, specifically for not including a rationale for entrepreneurial discovery of pure profit. In this article, I assess Kirzner’s argument, drawing from the theory originally developed by Carl Menger in his groundbreaking Principles of Economics. I specifically contrast Kirzner’s perspective with Menger’s theory regarding the concept of economic good, which offers insights into how and by whom goods are valued and the implications for the Austrian theory of entrepreneurship and production. Following my assessment and critique, I leverage Menger’s economic theory to draft a uniquely Austrian ethic for the free enterprise system.

Keywords: Entrepreneurship, Ethics, Free enterprise system, Carl Menger

JEL Classification: B53, L26, P1