Bob finishes his 3-part series by first reviewing the contributions of Bohm-Bawerk, Fetter, and Mises to the modern Austrian explanation of interest, namely the “pure time preference theory” (PTPT). Then Bob explains some of the problems for the PTPT, especially for Austrian economists. Instead Murphy offers a much more straightforward–and Austrian!–approach, which explains interest as the premium placed on present vs. future units of money.
Mentioned in the Episode and Other Links of Interest:
- Part 1 and Part 2 in this series (BMS ep. 26 and 28).
- Bob’s doctoral dissertation, in which the second and third essays elaborate on the main elements of this episode.
- Eduard Braun’s article explaining how Carl Menger changed his view on capital. (Thanks to Ryan Griggs.)
- Use Bob’s special link to subscribe to Liberty Classroom, where (among other courses) you can get Bob’s two courses on the History of Economic Thought.
- Bob’s book (co-authored with Nelson Nash and Carlos Lara) The Case for IBC, which explains the Infinite Banking Concept.
- Help support the Bob Murphy Show.
The audio production for this episode was provided by Podsworth Media.