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Capital and Interest: A Critical History of Economic Theory
Von Boehm-Bawerk is one of the leading economists of the so-called Austrian school. With Karl Menger and others, he has contributed to the development of a theory of value which has received wide acceptance, and has been the cause of still wider discussion, in the economic world. This theory, as elaborated by Boehm von Bawerk, is based largely upon psychological principles. Its chief feature consists in a searching analysis of 'subjective value.’ In his “Capital and Interest”, the author makes a brilliant and original study of these two subjects. He does not accept the connuon classification of land, labor, and capital as the three sources of production, but regards the two former only as real sources, while capital is only a means of production. 'Interest’ is employed as a general term for interest in the common sense, and for profits, and its cause and justification are found in the great principle of the difference in value between present 'goods’ and future 'goods.’
357 pages, Kindle Edition
First published January 1, 1884
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About the author
Eugen von Böhm-Bawerk
98 books77 followersAustrian economist who made important contributions to the development of the Austrian School of Economics. He served intermittently as the Austrian Minister of Finance between 1895 and 1904. He also wrote a series of extensive critiques of Marxism.
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Displaying 1 - 9 of 9 reviews
July 30, 2022
Savage ruthless:
‘Perhaps I need not go farther. If what I have said is true, the socialist Exploitation theory, as represented by Marx, is not only incorrect, but, in theoretical value, even takes one of the lowest places among interest theories. However serious the fallacies we may meet among the representatives of some of the other theories, I scarcely think that anywhere else are to be found together so great a number of the worst fallacies-wanton, unproved assumption, self-contradiction, and blindness to facts.’
‘Perhaps I need not go farther. If what I have said is true, the socialist Exploitation theory, as represented by Marx, is not only incorrect, but, in theoretical value, even takes one of the lowest places among interest theories. However serious the fallacies we may meet among the representatives of some of the other theories, I scarcely think that anywhere else are to be found together so great a number of the worst fallacies-wanton, unproved assumption, self-contradiction, and blindness to facts.’
April 19, 2023
en översikt över mängd ekonomiska teorier, refererade på ett ganska sarkastiskt sätt.
February 3, 2016
The work of Böhm-Bawerk describes the history of the theory of capital and its interest. The author begins by describing the views of the ancient philosophers and theologians. Then he proceeds to describe many different theories and their criticism. The author has divided theories about capital into several groups. The first of these theories are colorless, which largely repeated what Adam Smith wrote. Another group is theories of productivity of capital, according to which capitalists receive interest due to the productive dimension of capital. Another group of theories services, capital, according to which capital subject to any additional services that must be paid as a percentage. The last group are the theories of abstinence capital. According to them, the capitalists receive profits because abstain from the consumption of capital. Therefore, the need for payment. The author presents the views of dozens of different economists, which are criticized by him. By this it is easy to get lost, especially if the author seamlessly goes from quoting authors to add your own observations and comments. I think in part this is due to the fact that the translation of this book is almost 100 years old, which makes it more difficult to read.
To me this is not a book for ordinary mortals, but rather for those involved in professional economics. Through the above-mentioned reasons the book is difficult to read. I gave a higher rating, since this book influenced greatly on the Austrian School of Economics.
The second part of the work of Böhm-Bawerk describes and criticizes the views of the socialists on the theory of exploitation. The author focused mainly on criticism of Marx and Rodbertus. In subsequent chapters the author complements criticism of previous trends for new authors. Unfortunately, the author does not own theory expounded here profit from capital (devoted to a separate work that is not translated into Polish). I think that it is worth to read criticism of the theory of exploitation. The rest of the book I recommend only to professional economist.
//polish
Praca Böhm-Bawerka opisuje historię teorii kapitału i zysku z kapitału. Autor rozpoczyna od opisania poglądów starożytnych filozofów i teologów. Później przechodzi do opisywania wielu różnych teorii i ich krytyki. Autor podzielił teorie na temat kapitału na kilka grup. Pierwszą z nich są teorie bezbarwne, które w dużej mierze powtarzają to, co napisał Adam Smith. Kolejną grupą są teorie produkcyjności kapitału, według których kapitaliści otrzymują odsetki ze względu na produktywny wymiar kapitału. Kolejną grupą są teorie usług kapitału, według których z kapitałem wiążą się dodatkowe usługi, które muszą zostać opłacone w postaci procentu. Ostatnią grupą są teorie wstrzemięźliwości kapitału. Według nich kapitaliści otrzymują zysk, ponieważ wstrzymują się z konsumpcją kapitału. Dlatego też potrzebują za to zapłaty. Autor przedstawia poglądy kilkudziesięciu różnych ekonomistów, które są przez niego krytykowane. Przez to łatwo można się pogubić, szczególnie wtedy, gdy autor płynnie przechodzi z cytowania autorów do dodawania własnych uwag i komentarzy. Myślę że po części wynika to z tego, że tłumaczenie tej książki ma prawie 100 lat, co dodatkowo utrudnia czytanie.
Według mnie to nie jest książka dla zwykłych śmiertelników, a raczej dla osób zajmujących się profesjonalnie ekonomią. Przez wyżej wymienione powody książka jest trudna w czytaniu. Dałem wyższą ocenę, ponieważ ta książka wpłynęła w olbrzymim stopniu na Austriacką Szkołę Ekonomii. Jednak z chęcią przeczytam drugi tom, ponieważ autor obiecał wyłożyć w niej swoje poglądy na temat zysku z kapitału, oraz znajduje się tam krytyka socjalistycznych teorii wyzysku.
Druga część pracy Böhm-Bawerka opisuje oraz krytykuje poglądy socjalistów na teorię wyzysku. Autor skupił się głównie na krytyce Marksa i Rodbertusa. W kolejnych rozdziałach autor uzupełnia krytykę poprzednich nurtów o nowych autorów. Niestety autor nie wyłożył tutaj własnej teorii zysku z kapitału(poświęcił na to oddzielną pracę która nie jest przetłumaczona na polski). Według mnie warto przeczytać krytykę teorii wyzysku, a co do reszty, do polecałbym lekturę co najwyżej ekonomistom. Książka jest dostępna za darmo na stronie Instytutu Misesa:
http://mises.pl/blog/2009/11/15/bohm-...
To me this is not a book for ordinary mortals, but rather for those involved in professional economics. Through the above-mentioned reasons the book is difficult to read. I gave a higher rating, since this book influenced greatly on the Austrian School of Economics.
The second part of the work of Böhm-Bawerk describes and criticizes the views of the socialists on the theory of exploitation. The author focused mainly on criticism of Marx and Rodbertus. In subsequent chapters the author complements criticism of previous trends for new authors. Unfortunately, the author does not own theory expounded here profit from capital (devoted to a separate work that is not translated into Polish). I think that it is worth to read criticism of the theory of exploitation. The rest of the book I recommend only to professional economist.
//polish
Praca Böhm-Bawerka opisuje historię teorii kapitału i zysku z kapitału. Autor rozpoczyna od opisania poglądów starożytnych filozofów i teologów. Później przechodzi do opisywania wielu różnych teorii i ich krytyki. Autor podzielił teorie na temat kapitału na kilka grup. Pierwszą z nich są teorie bezbarwne, które w dużej mierze powtarzają to, co napisał Adam Smith. Kolejną grupą są teorie produkcyjności kapitału, według których kapitaliści otrzymują odsetki ze względu na produktywny wymiar kapitału. Kolejną grupą są teorie usług kapitału, według których z kapitałem wiążą się dodatkowe usługi, które muszą zostać opłacone w postaci procentu. Ostatnią grupą są teorie wstrzemięźliwości kapitału. Według nich kapitaliści otrzymują zysk, ponieważ wstrzymują się z konsumpcją kapitału. Dlatego też potrzebują za to zapłaty. Autor przedstawia poglądy kilkudziesięciu różnych ekonomistów, które są przez niego krytykowane. Przez to łatwo można się pogubić, szczególnie wtedy, gdy autor płynnie przechodzi z cytowania autorów do dodawania własnych uwag i komentarzy. Myślę że po części wynika to z tego, że tłumaczenie tej książki ma prawie 100 lat, co dodatkowo utrudnia czytanie.
Według mnie to nie jest książka dla zwykłych śmiertelników, a raczej dla osób zajmujących się profesjonalnie ekonomią. Przez wyżej wymienione powody książka jest trudna w czytaniu. Dałem wyższą ocenę, ponieważ ta książka wpłynęła w olbrzymim stopniu na Austriacką Szkołę Ekonomii. Jednak z chęcią przeczytam drugi tom, ponieważ autor obiecał wyłożyć w niej swoje poglądy na temat zysku z kapitału, oraz znajduje się tam krytyka socjalistycznych teorii wyzysku.
Druga część pracy Böhm-Bawerka opisuje oraz krytykuje poglądy socjalistów na teorię wyzysku. Autor skupił się głównie na krytyce Marksa i Rodbertusa. W kolejnych rozdziałach autor uzupełnia krytykę poprzednich nurtów o nowych autorów. Niestety autor nie wyłożył tutaj własnej teorii zysku z kapitału(poświęcił na to oddzielną pracę która nie jest przetłumaczona na polski). Według mnie warto przeczytać krytykę teorii wyzysku, a co do reszty, do polecałbym lekturę co najwyżej ekonomistom. Książka jest dostępna za darmo na stronie Instytutu Misesa:
http://mises.pl/blog/2009/11/15/bohm-...
May 31, 2021
Böhm-Bawerk's masterful treatise on historically propounded theories of and explanations for the phenomenon of interest is an evergreen work that still holds up to this day. As evidenced by the history of terrible theories of interest, it is not an easy subject to write about, much less an easy subject to critically analyse in such depth. The genius of Böhm-Bawerk really shines through in every chapter of this text in the way he deconstructs and dissects the ideas of his predecessors in his unwavering quest for scientific truth. Along the way, he provides invaluable advice for thinking like an economist by simply demonstrating what it is that economic thinking consists of.
The problem of interest is neatly presented as follows, to distinguish the economic problem from the political one:
There are many ways that a theory of interest can fail; it may gloss over the phenomenon itself (as in the case of the 'colourless theories'); it may stop at mere production itself, before the problem of distribution and thus fail at explaining the crucial issue (the 'Naive Productivity', 'Labour', and 'Fructification' theories); it may go beyond the issue completely and doxastically insist upon a false reality in which distribution alone is the focus (the 'Exploitation Theory'); or it may provide some hints towards the right answer but build upon shaky grounds or unsatisfactory explanations (The 'Use' and 'Abstinence' theories). In this regard Menger's formulation of the Use theory is in a sense the 'least wrong' of all the theories, because it correctly identifies the fundamental question and proceeds towards establishing a coherent answer. This text goes through them all; taking from each theory either lessons or warnings, and building up a picture of what a correct theory would have to do... without ever getting to that positive project. That, dear reader, is reserved for the sequel.
The problem of interest is neatly presented as follows, to distinguish the economic problem from the political one:
From the theoretical problem of interest must be carefully distinguished the social and political problem. The theoretical problem asks why there is interest on capital. The social and political problem asks whether there should be interest on capital-whether it is just, fair, useful, good,-and whether it should be retained, modified, or abolished. While the theoretical problem deals exclusively with the causes of interest, the social and political problem deals principally with its effects. And while the theoretical problem is only concerned about the true, the social and political problem devotes its attention first and foremost to the practical and the expedient.
There are many ways that a theory of interest can fail; it may gloss over the phenomenon itself (as in the case of the 'colourless theories'); it may stop at mere production itself, before the problem of distribution and thus fail at explaining the crucial issue (the 'Naive Productivity', 'Labour', and 'Fructification' theories); it may go beyond the issue completely and doxastically insist upon a false reality in which distribution alone is the focus (the 'Exploitation Theory'); or it may provide some hints towards the right answer but build upon shaky grounds or unsatisfactory explanations (The 'Use' and 'Abstinence' theories). In this regard Menger's formulation of the Use theory is in a sense the 'least wrong' of all the theories, because it correctly identifies the fundamental question and proceeds towards establishing a coherent answer. This text goes through them all; taking from each theory either lessons or warnings, and building up a picture of what a correct theory would have to do... without ever getting to that positive project. That, dear reader, is reserved for the sequel.
March 17, 2024
This book is primarily a history of economic thought which discusses all the various theories of capital and interest. A lot of the economists Bohm-Bawerk mentions, especially in the first few chapters, have been forgotten to time so it's kinda boring. However, it gives him the opportunity to refute their understandings of capital and interest, explain their flaws, and explain his own theory.
Bohm-Bawerk was a good writer and good economist, and this is apparent in his prose. He makes himself remarkably clear to the reader.
Something that is especially appreciable about Bohm-Bawerk is his academic honesty. He provides due respect and context to each economist, explaining things specific to their understanding, and using pages-long, uninterrupted quotations for the reader to analyze. He merely points out contradictions in their thinking; it is a simple, but brilliant style.
Bohm-Bawerk was a good writer and good economist, and this is apparent in his prose. He makes himself remarkably clear to the reader.
Something that is especially appreciable about Bohm-Bawerk is his academic honesty. He provides due respect and context to each economist, explaining things specific to their understanding, and using pages-long, uninterrupted quotations for the reader to analyze. He merely points out contradictions in their thinking; it is a simple, but brilliant style.
October 21, 2022
This book covers alot of ground, some chapters I had to re-read, we go back to ancient philosophy and their view of money and trade, early banking systems, more sophisticated banking, and the sad advent of the state intervention in those banking systems.
A very good book, highly recommend if you want an understanding of the foundation of a basic financial sector, banks and the money we all use, and the money we don't use.
All In all a good book, though it's not for beginners, it recommend reading half a dozen Austrian economics books before you get to this one.
A very good book, highly recommend if you want an understanding of the foundation of a basic financial sector, banks and the money we all use, and the money we don't use.
All In all a good book, though it's not for beginners, it recommend reading half a dozen Austrian economics books before you get to this one.
August 3, 2025
Interesting if you are in to Austrian Economics and various alternative theories of "interest" that were considered and discarded.
September 5, 2024
Upgraded from two to four stars on this rereading, mainly because of the painstaking review and close analysis of previous literature.
But his time preference theory -- he develops it mostly in A Positive Theory of Capital, but summarizes its main outlines in this book -- is full of holes that don't stand up to critique in the light of institutionalist economics. And despite his quibbling, time preference is just another theory of advance economics that's (at the very least) closely related to abstention theories like Senior's.
But his time preference theory -- he develops it mostly in A Positive Theory of Capital, but summarizes its main outlines in this book -- is full of holes that don't stand up to critique in the light of institutionalist economics. And despite his quibbling, time preference is just another theory of advance economics that's (at the very least) closely related to abstention theories like Senior's.
Displaying 1 - 9 of 9 reviews