
Jesús Huerta de SotoRey Juan Carlos University | URJC · Departamento de Economía Aplicada I
Jesús Huerta de Soto
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Introduction
Prof. of Political Economy
Skills and Expertise
Publications
Publications (171)
Entrepreneurial knowledge is exclusive and dispersed. What do I mean by this? When I say it is exclusive, I mean that each human being, each one of us, every man, every woman, possesses, as it were, a few “atoms” or “bits” of the information used in society, that is, a tiny amount of all the subjective, practical information people continually gene...
“Rationalism,” derives etymologically from the term “reason.” In fact, human reason is the most important tool we have for getting along in life. Does anyone doubt that? I don’t know if any of you has ever had a family member, maybe an elderly person, with Alzheimer’s disease. When we lose our intellectual abilities, we become totally helpless. We...
What is the essential principle of entrepreneurship? The essential principle of entrepreneurship is that though there is no guarantee, people have a tendency to achieve their ends. The reason we tend to accomplish what we set our minds to is obvious. Imagine I am lost in a sea storm at night, which is one of the most horrible situations to be in, a...
We’re ready to start talking about economic calculation. Economic calculation is, if you will, the center around which Mises constructs his theory of social cooperation. The term “calculation” derives from the Latin calx, calcis, and the limestone pebbles that were used in abacuses were called calculi. Calculation … to calculate. How is it possible...
Entrepreneurial knowledge: such knowledge is essentially creative. As we will see, it has two facets, which are like two sides of the same coin: the creative facet and the coordinating facet. What do we mean when we say entrepreneurial knowledge is essentially creative? Well, I’ll say it again: we’re dealing with something astonishing and awe-inspi...
I’m now going to sum up the most important points Mises makes in the section titled “Ends and Means.” We’ve talked about this before; what is an end? According to Mises, an end is the result an actor intends to achieve with his action. And what is a means? (Remember that in English, “means” always ends with an “s,” even when it’s singular.) A means...
Now, we’re going to study the laws of economics which operate in a process of social cooperation we will call the “market economy.” The market economy is a social system based on the division of knowledge and on the private ownership of consumer and producer goods and services. It is a social process which rests on contractual ties. It is a social...
To better understand the essential methodological differences between the world of the natural sciences and that of the social sciences, let’s outline these differences by contrasting the two worlds. Point number one: The natural sciences study relatively simple phenomena, while the sciences of human action study relatively complex, or, if you will...
In one fell swoop, we move on to action in the world. Dear students, we will now begin to outline economic laws. We’ll start with the most basic ones, the simplest ones. We’re going to start with the law of marginal utility. To study this law, we’ll imagine an action, but one that does not require the involvement of more than one human being. At th...
In the second lesson, we took our first look at entrepreneurship. We said that in a broad sense, entrepreneurship coincides with human action. We defined human action, and we considered the elements that comprise it, and so we covered the fundamental concepts of economics: ends, value, means, utility, cost, time, etc. Well, today we are going to ta...
We have just talked about the law of marginal utility. Remember that it is the law that explains the value of economic goods. Well, from the standpoint of the individual actor, the other essential law we’re going to present now, and which, when the time comes, will help us understand the market process with respect to factors of production (labor,...
The sciences of human action, to which I have referred in general, divide into two large branches: theory and history. The theory of human action is economics as we have approached it up to now. That is, theory is a formal, abstract, qualitative, and general study of the processes of human interaction. History, the other essential branch the social...
This section is devoted to the law of cost. I would like to make this very clear to you, because intuitively, many people believe costs determine prices. They believe it, because there is a kind of pricing mechanism in stores, in the commercial world, that appears to support that theory. Imagine I own a shoe store, and I buy shoes wholesale from a...
I must begin by making the following crystal clear: prices are determined in the market as a result of a social process fueled by entrepreneurship. This is obvious, but we need to repeat it, because the vast majority of my colleagues—economics professors and department heads—present the determination of prices as if it resulted from the intersectio...
Let us recall that when we talked about method, we saw how economic science is constructed. To construct it, we begin with the analytically simplest phenomena. The simplest of all is the axiom of human action. Then, we gradually introduce assumptions in our chain of logical-deductive reasoning, and we arrive at more complex laws. Up to now, I have...
We are now going to look at competition and monopoly. Is competition a state, or is it a process? We have already said that entrepreneurship, by its very nature, is always competitive, and that the word “competition” derives from the Latin cumpetitio, which means “the concurrence of multiple requests for the same thing, which must be assigned an ow...
The method of political economy is an essentially aprioristic and deductive method. What do I mean when I say the method of political economy is aprioristic? I mean that we construct our discipline in the following way: We always begin with an axiom, an irreducible assumption, an ultimate given. We’ve already discussed this in class. We’ve said tha...
Today we are going to introduce another key element of economics, and that is the concept of time. Dear students, all human action takes place in time. All human action takes time. If there is one important aspect of the view of economics I am presenting to you, it is that it is a subjectivist view of economics. As I have said, ends are subjective...
The next essential element of the idea of human action is that of cost: another pivotal concept around which economic science has revolved since its inception. Cost is a value, and therefore, it is subjective. Cost is a value attached to an end but take note: it is not attached to the end the actor is pursuing. Instead, the cost is the value we as...
We will begin by studying entrepreneurship. Entrepreneurship is the pivotal concept around which all economic science revolves. If we do not grasp the concept, nature, and characteristics of entrepreneurship, we cannot possibly grasp anything in economics. As I was explaining to you the other day, economics is the science that studies the processes...
The first characteristic of entrepreneurial knowledge is that it is subjective and practical, rather than scientific. What does this mean? Etymologically Practical comes from praxis. Praxis, in Greek, means action. Entrepreneurial knowledge is subjective—it has a subject—and practical, in the sense that one cannot acquire it in a formal manner but...
Positivism and social engineering are the great idols that indirectly provoked all the conflicts, genocides, etc., that devastated humanity in the twentieth century. Therefore, it is my responsibility to express to you my criticism of positivism. Hayek refers to positivism as “scientism,” and he defines it as follows. He says that scientism is the...
Now for the third characteristic of entrepreneurial knowledge: entrepreneurial knowledge is tacit and inarticulate. What does this mean? It means that entrepreneurial action teaches us how to perform certain actions. It shows us how to acquire practical habits of behavior—what English speakers call “know-how.” So, we set out to gain some know-how,...
Every entrepreneurial act produces three extremely important, indeed vital, effects, and these effects lie at the heart of the knowledge economics can provide about the market process. The three effects that result from the entrepreneurial act are: first, the creation of information; second, the transmission or communication of information; and thi...
We are going to ponder the differences that exist or should exist between the methods of study in social science (economic science, the science in which we are the subjects) and the methods of study in the natural sciences (physics, chemistry, etc., in which the objects of research are inanimate entities—that is, they have no soul—from the outside...
We have asked, “What is entrepreneurship?” And we have equated it with the concept of human action and explained its etymological origin. But what is human action? Well, we already have an idea: to discover, seize, realize … But in scientific terms, we will define human action as “all deliberate behavior or conduct.” We need not repeat that it must...
La mayoría de los alumnos ya me han enviado el correspondiente comentario de texto sobre el discurso del presidente de Argentina Javier Milei la semana pasada en Davos, y alguno de ellos me dice: “eso está muy bien, pero, ¿qué comentaría usted señor profesor?”. Es una pregunta inteligente. Yo como alumno también la haría, y sin ánimo de condicionar...
Following the success of the first edition of Dinero, Crédito Bancario y Ciclos Económicos, which sold out rapidly, I am pleased to present the second edition to Spanish-speaking readers. To avoid confusion and facilitate the work of scholars and researchers, the contents, structure and page numbering of the first edition have been maintained in th...
Nota introductoria: en el presente ensayo y siguiendo como hilo conductor lo poco que sabemos sobre la vida de San José y sus enseñanzas como padre a su Hijo, pretendo conectar las sagradas Escrituras con los principios esenciales de la Escuela Austriaca de Economía y del enfoque en pos de la libertad que le es propio. Me he tomado la libertad, o m...
The conventions of monetary theory assume the central banking system (CBS) as the starting point for achieving the stability and efficiency of the financial system. This paper stresses the stability-efficiency thesis based on the Austrian business cycle theory (ABCT). It argues that the stability-efficiency thesis under CBS poses a paradox for two...
It is generally stated that the fractional-reserve banking system (FRBS) is consistent with sustainable economic growth and development. While it assumes that depositors will not be a joint demand who will claim all their money simultaneously, it supposes that a monetary aggregate greater than the monetary base will not harm economic performance. H...
CORRESPONDENCIA PRIVADA ENTRE EL PROF. MURRAY N. ROTHBARD Y EL PROF. JESÚS HUERTA DE SOTO, 1993-1994*
Con motivo del 75 aniversario de la Fundación de la Mont PèlerinSociety en abril de 1947, se publican por primera vez las actas de lareunión primera que dio lugar a la Sociedad y que fueron tomadastaquigráficamente por Dorothy Hahn, secretaria del organizadordel evento, F.A. Hayek.
In this first decade of the twenty-first century, classical liberal thought, in both its theoretical and political aspects, has reached ahistoric crossroads.
El anuncio por parte del Gobierno de que proyecta instaurar un nuevo «Impuesto de Solidaridad» que gravará la riqueza de aquellos que posean más de tres millones de euros ha vuelto a poner en el centro del debate a los impuestos que gravan el patrimonio y el capital.
This paper analyses the economic effects of the current COVID-19 pandemic from the point of view of the Austrian School of Economics from a triple perspective: (1) the theory of capital and productive structure; (2) the theory of money and financial markets; and (3) the theory of dynamic efficiency.
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This is a critical-hermeneutical review on labor relations under the heterodox approaches, specially the Austrian Economics, to debate with mainstream bias. First, there is a diagnosis about the economic interventionism in the World and which is the current relation between the economic theory and applied economics. Second, the attention is fo...
p> This is a comparative review of business cycles and economic growth, according to the heterodox approaches, to improve the dialogue and the knowledge about it. Special attention is given to the endemic problem of the business cycles that modern economies suffer, such as successive and distorted periods of boom and bust, with great impact in the...
p> This is a comparative review of business cycles and economic growth, according to the heterodox approaches, to improve the dialogue and the knowledge about it. Special attention is given to the endemic problem of the business cycles that modern economies suffer, such as successive and distorted periods of boom and bust, with great impact in the...
p>
This is a critical-hermeneutical review on labor relations under the heterodox approaches, specially the Austrian Economics, to debate with mainstream bias. First, there is a diagnosis about the economic interventionism in the World and which is the current relation between the economic theory and applied economics. Second, the attention is fo...
Debemos agradecer al Prof. Alejandro Nieto, eximio catedrático que fue de Derecho Administrativo, y uno de los miembros másbrillantes y productivos de la Real Academia de Ciencias Morales y Políticas, el esfuerzo que ha hecho estudiándose todas las actas de la Asamblea Nacional de la Primera República, así como la práctica totalidad de los periódic...
Que un catedrático de Teología Moral Fundamental (en la Universidad Pontificia de la Santa Cruz de Roma) haya escrito y publicado este pequeño gran libro debe considerarse todo un hito, no sólo por los lectores y estudiosos de Procesos de Mercado y de la Escuela Austriaca de Economía, sino también, y sobre todo, para todos aquellos, creyentes o no,...
Los tres libros que se reseñan, y que he tenido la oportunidad de estudiar con detalle a lo largo de los meses del verano de 2021, se complementan mutuamente. Los tres están orientados en la misma dirección y, sin ser «negacionistas» stricto sensu, pues reconocen que el clima es dinámico y parece que ahora está en un nuevo ciclo de calentamiento, e...
This paper analyzes the Spanish energy transition’s general situation and its increasing electricity prices in recent years from a free-market environmentalist (FME) approach. We hypothesize and argue that high taxes, high government subsidies, and government industrial access restrictions breach private property rights, hindering Spain’s renewable...
El principal mérito de este librito, y que de por si justifica su lectura, es que incorpora al dictado el texto de las clases que Ludwig von Mises impartió en el verano de 1951 en la Foundation for Economic Education (FEE) de Nueva York.
Behavioral development economics promotes the nudge theory as a mechanism to incorporate people’s cognitive biases, steering their behavior in the desired direction through coercive state intervention. Cognitive biases become a reason to doubt the efficiency of decision-making psychology in the free market process. A fundamental assumption of this...
The analysis of sustainable economic growth and development often focuses on how to control the market process through coercive state intervention. While state interventionism may play a significant role in countries’ progress, entrepreneurship is the driving force behind sustainable growth and development. Entrepreneurship is the people’s judgment...
En este artículo se analizan los efectos económicos de la actual pandemia de Covid-19 desde el punto de vista de la Escuela Austriaca de Economía desde un triple enfoque: 1) la teoría del capital y de la estructura productiva; 2) la teoría de la eficiencia dinámica y la imposibilidad del socialismo; y 3) la teoría monetaria y financiera. Palabras c...
Renewable energy (RE) is one of the most popular public policy orientations worldwide. Compared to some other countries and continents, Europe has gained an early awareness of energy and environmental problems in general. At the theoretical level, free-market environmentalism indicates that based on the principle of private property rights, with fe...
This paper reviews the management of the COVID-19 crisis and the difficulty of cost estimation model, comparing centralized management or bureaucratic government coaction and the agile market alternative or spontaneous social coordination. This is a study of Political Economy and Health Economics from the perspective of Austrian Economics. We descr...
This paper analyses the COVID-19 crisis and its management from the perspective of Austrian Economics. The attention focuses on the State’s coercive intervention according to the principles of political economy, capital theory and Austrian business economic cycles. The paper examines the specific case of massive intervention by governments and, esp...
This paper analyses the COVID-19 crisis and its management, under the Austrian Economics. The attention is focused in the States’ coercive intervention, to evaluate the positive or negative effects of pandemic, according to the Principles of Political Economy and the theory of capital and economic cycles. The paper examines the specific case of mas...
In my book «Money, Bank Credit, and Economic Cycles» (1st Spanish Edition 1992, 2nd English Edition 2009) I present a detailed analysis of the Austrian Business Cycle Theory. Now I will concentrate on the financial crisis and the current worldwide economic recession as one of the most challenging problems we must now cope with and the way in which...
En diferentes trabajos, pero sobre todo en mi artículo titulado «La teoría de la eficiencia dinámica» (Procesos de Mercado, vol. I, n.º 1, primavera 2004, pp. 11-71), he tratado de demostrar de qué manera la moral personal (especialmente en los ámbitos de la mo-ral sexual, familiar y de la ayuda a los que nos necesitan) impulsa la eficiencia dinámi...
En la Grecia clásica se inicia la epopeya intelectual que construyó los cimientos de la civilización occidental. Sin embargo, desgra-ciadamente, los pensadores griegos fracasaron en su intento a la hora de comprender los principios esenciales del orden espon-táneo del mercado y del proceso dinámico de cooperación social que les rodeaba. Si bien hay...
En las páginas 80 a 83 de mi libro Socialismo, cálculo económico y fun ción empresarial (4.ª edición, Unión Editorial, Madrid 2010) explico el proceso de profundización «vertical» y extensión «horizontal » de la división del conocimiento práctico empresarial que permite (y a la vez exige) el aumento de la población, impulsa la prosperidad y bienest...
A careful reading of the quotations that Hayek left us upon his death on hundreds of cards explains what is, in his opinion, the ultimate and definitive test of whether or not someone is a true economist. It is curious to draw attention to the fact that Hayek had already referred to this matter in Appendix III to his Pure Theory of Capital, which h...
This article explains why the ideal of classical liberalism is theo-retically and practically impossible, as well as that the only system of social cooperation theoretically possible and wholly compatible with human natu-re is anarcocapitalism. Key words: Classical liberalism, anarcocapitalism, socialism, statism, entre-preneurship. Códigos JEL: B5...
No hay nada más práctico que una buena teoría. Por eso, me pro-pongo explicar en términos teóricos qué es el socialismo y por qué es un error intelectual, una imposibilidad científica. Mos-traré por qué se desmoronó, por lo menos el socialismo real, y por qué el socialismo que sigue existiendo en forma de inter-vencionismo económico en los países o...
The severe financial crisis and resulting worldwide economic recession we have been forecasting for years are finally unleashing their fury. In fact, the reckless policy of artificial credit expansion that central banks (led by the American Federal Reserve) have permitted and orchestrated over the last fifteen years could not have ended in any othe...
Los tres años transcurridos desde el comienzo de la crisis finan-ciera mundial y posterior recesión económica han supuesto la gran oportunidad de la Escuela Austriaca para popularizar su teoría del ciclo económico y su enfoque de análisis dinámico de la realidad social. En mi caso concreto, nunca pude imaginar a principios de 1998, cuando se public...
This paper defends the Euro from the point of view of Austrian Economics. Folloming Mises and Hayek it demonstrates the Euro is acting as a proxy of the gold standard disciplining polititians and putting a limit to the growth of the welfare state. Key words: Gold standard, fixed and flexible exchange rates, welfare state crisis, competition among m...
Aunque la actual crisis económica tuvo un origen monetario (la grave expansión crediticia y monetaria a reducidísimos tipos de interés orquestada por los bancos centrales en los pasados cinco años), la misma tiene actualmente una naturaleza real básicamente microeconómica: muchos empresarios, engañados por las arti-ficiales facilidades crediticias,...
La Escuela Austriaca es una escuela de economistas de gran abo-lengo que ha experimentado un notable resurgir en los últimos treinta años y que actualmente se postula como una de las prin-cipales alternativas de futuro para sustituir al paradigma neo-clásico-walrasiano hasta ahora dominante en la Ciencia Eco-nómica, pero que hoy ha entrado en una f...
Definir el socialismo exige entender previamente el concepto de «función empresarial». Los teóricos austriacos de la economía de-finen la función empresarial como una capacidad innata del ser humano que consiste en descubrir, crear, darse cuenta de las opor-tunidades de ganancia que surgen en su entorno y actuar en con-secuencia para aprovecharse d...
This paper presents an alternative, dynamic view of economic efficiency as a replacement for the static Paretian approach prevalent until now. The development of the Paretian perspective is traced, and a proposal is then made to reintroduce the dynamic aspect of efficiency, a dimension based on the creative, coordinating potential of entrepreneursh...
El endiosamiento de la razón humana es la principal amenaza de nuestro tiempo. La persona llega a creer que mediante la ingeniería social será capaz de construir el paraíso terrenal a través del Estado. Este modelo presenta al Estado moderno como una alternativa al Reino de Dios. También, habrá quienes pidan que el Mesías ejerza su poder e imponga...
In this paper Prof. Huerta de Soto attacks the current anti-deflationist paranoia from the point of view of the Austrian School of Economics. After discussing three different types of deflation (that deliberately provoked by the authorities, the inevitable credit deflation after a crisis, and the good deflation based on increasing productivity), Hu...
Barnett and Block (2015) claim that Bagus and Howden (2012b) support indirectly the concept of market failure. In this paper, we show that maturity mismatching in an unhampered market may imply entrepreneurial error but cannot be considered a market failure. We demonstrate why fractional-reserve banking leads to business cycles even if there is no...