Meaning of Macro Economics The word macro means big. Thus, in Macro Economics, either the whole economy is studied or those big units which are related to the economy as a whole. Definition In the words of Prof. Boulding Macro Economics deals not with individual quantities as such but aggregates of these quantities, not with individual […]
Eugen von Böhm-Bawerk
- Name: Eugen von Böhm-Bawerk
- Date of birth: February 12, 1951
- Date of death: August 27, 1914
- Nationality: Austria-Hungary
- Occupation: Economist
- Known for: Criticism of Karl Marx’s exploitation theory
Eugen von Böhm-Bawerk was an Austrian economist who made important contributions to the development of the Austrian School of Economics and neoclassical economics. He served intermittently as the Austrian Minister of Finance between 1895 and 1904. He also wrote extensive criticisms of Marxism.
Böhm-Bawerk was born in Brno, Moravia (now in the Czech Republic) on February 12, 1851. He studied law and economics at the University of Vienna, where he was a student of Carl Menger, the founder of the Austrian School of Economics. After graduating from university, Böhm-Bawerk worked as a lawyer and economist. In 1881, he was appointed professor of economics at the University of Vienna.
Böhm-Bawerk’s most important contributions
Böhm-Bawerk’s most important work is his two-volume treatise Capital and Interest (1884-1889). In this work, he developed a theory of interest that is based on the productivity of capital. Böhm-Bawerk argued that interest is not a payment for the use of money, but rather a payment for the use of capital goods. Capital goods are productive resources, such as machines and tools, that are used to produce other goods and services. The productivity of capital goods means that they can produce more output than the amount of input that is required to produce them. This productivity of capital goods is what generates interest income.
Böhm-Bawerk’s theory of interest was controversial when it was first published, but it is now widely accepted by economists. His work has also been influential in other areas of economics, such as the theory of entrepreneurship and the theory of economic growth.
Böhm-Bawerk died in Kramsach, Austria, on August 27, 1914. He was 63 years old.
Here are some of his other notable works:
- The Positive Theory of Capital (1891)
- The Theory of Money and Credit (1898)
- Karl Marx and the Close of His System (1896)
- The Austrian Economists (1912)
Böhm-Bawerk as Minister of Finance
Böhm-Bawerk was a prolific writer and his work has had a lasting impact on economics. He is considered one of the most important economists of the 19th century.
It is also notable that Böhm-Bawerk, who held professorships at the Universities of Innsbruck and Vienna, not only made crucial contributions to the proverbial ivory tower but also tried to give practical meaning to the theories that he developed. He served three terms as a minister of finance for the Habsburg Monarchy and was well-known for scientifically informed decisions.
For this reason, Böhm-Bawerk’s face could be found on the last version of the Austrian 100-Schilling banknote. He is – apart from Adam Smith – the only economist to ever have been printed on an official banknote.