The upper turning point in the Austrian business cycle theory

• Published in: The Review of Austrian economics Vol. 35; no. 1; pp. 89 - 97
• Main Authors: Evans, Anthony J., Cachanosky, Nicolás, Thorpe, Robert
• Format: Journal Article
• Language: English
• Published: New York Springer US 01.03.2022; Springer Nature B.V
• Subjects: Business cycles; Capital; Consumer goods; Consumers; Consumption; Discount rates; Economics; Economics and Finance; Growth rate; History of Economic Thought/Methodology; Interest rates; Money demand; Political Science; Preferences; Prices; Public Finance; Recessions; B53; Business cycles; E32; Austrian business cycle; Turning point

This paper defends the relevance of Austrian Business Cycle theory (ABCT) within a fiat money regime, by providing an answer to whether a constant rate of credit expansion necessarily leads to a boom-bust cycle. We claim that this scenario has two potential outcomes, (1) a change in money demand bri...