Understanding “Austrian” Economics

Bradley in DC · 10-15-2007, 07:46 AM

http://mailsage.aristotle.net/click.aspx?lid=1C1hp1Txxs (pdf)

Brutus · 10-15-2007, 08:18 AM

Great article. A good introduction.

DocGrimes · 10-16-2007, 09:58 AM

Agreed, nice little article.

axiomata · 10-16-2007, 12:42 PM

Thanks.

I was wondering if any adept economist could explain the whole time preference of money theory to me, as that was the only part that I didn't really understand.

Specifically, what's the difference between a "time-preference," a "productivity preference," and a "combined productivity and time preference" theory of interest.

Broadlighter · 10-16-2007, 03:00 PM

This relates to the time value of money, which can be applied to the time value of anything. The sooner money comes in, the more valuable it is. The sooner you can produce something, the sooner you can sell it and the more valuable the revenues are to you.

In the investment world, buyers of securities discount them on the notion that they can buy a note for less than its asking price and betting that it will yield more money down the road. The seller, who wishes to offload the note will determine how much of a discount he can stand based on his motivation to get cash for it.

10-15-2007, 07:46 AM	#1
Bradley in DC Senior Member Join Date: May 2007 Location: Capitol Hill, DC Posts: 12,120	Understanding “Austrian” Economics http://mailsage.aristotle.net/click.aspx?lid=1C1hp1Txxs (pdf) __________________ My review of the For Liberty documentary: digg.com/d315eji (please Digg and post comments on the HuffPost site) "This political train-wreck Republicans face can largely be traced to Bush’s philosophical metamorphosis from a traditional, non-interventionist conservative to the neoconservatives’ exemplar of a 'War President', and his positioning of the Republicans as the 'War Party'." Nicholas Sanchez on Bush's legacy, September 30, 2007.

10-16-2007, 12:42 PM	#4
axiomata Senior Member Join Date: May 2007 Location: WA, USA Posts: 1,571	Thanks. I was wondering if any adept economist could explain the whole time preference of money theory to me, as that was the only part that I didn't really understand. Specifically, what's the difference between a "time-preference," a "productivity preference," and a "combined productivity and time preference" theory of interest. __________________ Truth forever on the scaffold, Wrong forever on the throne,-- Yet that scaffold sways the future, and, behind the dim unknown, Standeth God within the shadow, keeping watch above his own. ‫‬‫‬

10-16-2007, 03:00 PM	#5
Broadlighter Senior Member Join Date: Jun 2007 Posts: 772	Here's my understanding This relates to the time value of money, which can be applied to the time value of anything. The sooner money comes in, the more valuable it is. The sooner you can produce something, the sooner you can sell it and the more valuable the revenues are to you. In the investment world, buyers of securities discount them on the notion that they can buy a note for less than its asking price and betting that it will yield more money down the road. The seller, who wishes to offload the note will determine how much of a discount he can stand based on his motivation to get cash for it. __________________ If you want less oppressive government, quit trying to expand it.

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10-15-2007, 08:18 AM	#2
Brutus Senior Member Join Date: Jul 2007 Location: Texas Posts: 473	Great article. A good introduction.

10-16-2007, 09:58 AM	#3
DocGrimes Member Join Date: Aug 2007 Posts: 95	Agreed, nice little article.