manipulating interest rates. But it hasrntaken the eollapsc of sociahsm to makernthe names and ideas of Menger and hisrnfollowers (Mises most prominently)rnwidely rceognizcd. Austrian economicsrnnow finds itself in a boom phase, fromrnhaving been almost alone in predictingrnthe abvsmal consequences of centralrneconomic planning and collectivelyrnowned propertv. The intellectual edificernit built to counter socialism, explainingrnthe workings of the marketrneconomy and the results of tamperingrnwith its operations, makes it profound!}’rnrelevant in the postsocialist epoch.rnTbda’ economists smpathetic to thernAustrian School span the globe, andrnthev are cjuietlv infiltrating economicsrndepartments long dominated b’ variantsrnof Kcxnesian ideology. If the trend continues,rnthis decade will see a renaissancernof the Austrian tradition, Wc will knovrnit has occurred when the writers of historv-rnof-thought texts are forced to seernthe tradition as living on bevond the latern19th eentur’ and even offering an alternativernparadigm to today’s mainstreamrneconomic opinion.rnOf the thousands of articles andrnbooks in this tradition, what singlernwork offers a comprehensive introduction?rnRcmarkabl) such a volume didrnnot exist until now, which is why thernvolume edited by Professor RichardrnEbcling of Hillsdale College is a landmark.rnIt is simply and appropriately titledrnAustrian Economics: A Reader; inrnputting it together. Professor Ebelingrnmade a series of inspired decisions. Arnsimilar volume about the KevnesianrnSchool would lead the reader into a miasma,rna worid clouded by contradictions,rnconfused interpretations, recurring retractions.rnBut the preoccupations ofrnAustrian School tradition are soundlyrndemonstrated here: methodological individualism,rnthe market as an instrumentrnof economic coordination and socialrncooperation, and state interveirtionrnas a source of economic chaos.rnFrom Menger to modern theorists likernRothbard and Roger Garrison, and includingrnthe many in between, this bookrncollects some of the school’s most importantrnessays. The first sections fleshrnout the philosophical foundation of thernschool, with contributions by LudwigrnLachmann (carving out a special placernfor the school), Ebeling (contributingrntwo bibliographic essavs), Rothbard (defendingrnthe “logic of action” or praxeologv),rnHayek (arguing for the centralityrnof individual decision-making), Misesrn(distinguishing social from natural science),rnLeland B. Yeager (easting doubtrnon the postulate that science means collectingrnnumbers), Menger (theorizingrnabout the sources of social evolution),rnand Mario Rizzo (hitting so-calledrneconometrics as riddled with fallacy).rnThe section arguing against macroeconomicrnmanagement, shovying howrnthe market serves its own coordinativernfunction, highlights the writings ofrnHavek and Mises, along with E.G. Pasour’srnideas on subjectivism and cost,rnand includes a piece on the role of entreprcneurshiprnby Kirzncr. The sectionrnon capital and interest—which centersrnon the issue of the passage of time—rnbrings the forgotten work of Eugen vonrnBohm-Bawerk (a finance minister in thernAustrian government) into the forefrontrnwith an essay he wrote in 1901 andrndemonstrates what an excellent theoristrnand writer he was. Through patient deduction,rnhe explains the way time factorsrninto the production process creatingrndistinctions among types of goods,rnhow long it takes to create them, andrnthe extent to vyhich they are desired onrnthe market. He predicts that by effectivelyrnabolishing the structure of production,rnsocialism will make “a relativelyrnsmall amount of consumption goodsrnavailable for the nation’s population.”rnEbeling also includes a fascinatingrnrebuttal by proto-Keynesian L, G.rnBostcdo, arguing against the importancernof savings, and a response by Bohm-rnBawerk.rnAustrian capital theory also encompassesrnthe controversial (within economics)rnidea that interest rates (earnedrnand paid) are determined by “time preference,”rnthe idea that people always preferrngoods sooner rather than later but inrndifferent degrees. Both Rothbard andrnVernon A. Mund bolster the case, alongrnwith an article by Kirzncr on Alises’ capitalrnand interest theory.rnMenger’s argument that money itselfrnoriginates in the market—not with therngovernment or a social compact—is includedrnhere, along with Mises’ theoryrnof the business cycle. Though hystericallyrnattacked as reactionary by bothrnmonetarists and Kcvnesians, Misesianrncycle-theory tells a story of central banksrnskewing investment decisions by manipulatingrninterest rates. The last section,rnonce again resting on tv() contributionsrnby Mises, brings the reader tornissues of public policy and to the importancernof legal institutions, which protectrnproperty and the private economy fromrninvasion.rnFor those wanting a look at the kindsrnof issues that modern Austrian economistsrnare working with, the book’srncompanion volume—Austrian Economics:rnPerspectives on the Past andrnProspects for the Future—is a great placernto start. Twenty-three contributors coverrna range of topics. Some notable contributionsrninclude: Hans-HermannrnHoppe’s methodological tour de forcerntouching on ethics; Peter Boettke’s explanationrnof why Soviet socialism failedrnfor reasons more fundamental than thernWest’s military buildup; Jack High’srnlinkage of the emergence of the regulatoryrnstate with the habit of viewing thernmarket as an entity frozen in time, ratherrnthan as a continuing process; and RogerrnGarrison’s argument that Keynesiansrnand monetarists are more alike than isrnconventionally supposed. Each paperrnhas two appended commentaries, andrnnone shrinks before rigorous criticism.rnBefore the turn of the century,rnMenger gave up economics and politiesrnbecause he feared that nothing could berndone to stop the onslaught of war, socialism,rnand the managerial state. Werernhe alive today, he might argue that hisrnpessimism vyas justified, but he wouldrnbe proud to see that his ov’n school hasrnheld to first principles, resisting therntemptation to join the legions of wouldbernstate managers who call themselvesrneconomists today. crnFor Immediate Servicernwmmwmrni /ic.shiraiu f/ifrnCHRONICLESrnNEW SUBSCRIBERSrnTOLL FREE NUMBERrn1-800-877-5459rnFEBRUARY 1993/31rnrnrn