HAYEK'S PRICES AND PRODUCTION

HAYEK, Friedrich A. Prices and Production. London: George Routledge & Sons, (1935). Small octavo, original blue cloth. $750.

Second edition in English, the first revised and enlarged edition of this acclaimed economics work that introduced the Hayekian Triangle.

This book, which is divided into four lectures entitled, "Theories on the Influence of Money on Prices," "The Conditions of Equilibrium between the Production of Consumers' Goods and the Production of Producers' Goods," "The Working of the Price Mechanism in the Course of the Credit Cycle," and "The Case for and against an 'Elastic' Currency," was at the center of an epic battle between Keynes and Hayek. Here Hayek proposed the Hayekian Triangle, which describes "the changes in the intertemporal pattern of the capital structure" (New Palgrave). In it, the stages of production fall along the horizontal, the market value of the final output is represented by the height of the vertical leg, and capital restructuring changes the overall shape. Hayek's creation contrasted sharply with Keynes' circular model. As a result, the two began a competitive scholarship that culminated in a number of works including Hayek's Profits, Interest and Investment and The Pure Theory of Capital. Co-winner of the 1974 Nobel Prize in Economics and a prominent member of the "Austrian School" of economic thought, Hayek went "beyond Mises in reformulating the notion of economic coordination as an information problem, competition acting essentially as a discovery process" (Blaug, 557). Hayek's main contributions as an economist have been his arguments about the benefits of free markets and the information provided by prices. These arguments lead to the conclusion that attempts to alter or control markets should be opposed because they inevitably limit individual freedom, reduce economic efficiency and lower living standards. Markets, for Hayek, were self-regulating devices that promote prosperity. Government policy and other attempts to hinder the workings of markets make us worse off economically and reduce individual liberty" (Pressman, 119). Featuring a new preface by Hayek, outlining recent developments of his theories. With "List of Studies in Economics and Political Science" at rear; without scarce dust jacket. The first edition in English was published in 1931, the same year as the German first edition.

Trace of foxing to preliminaries. A fine copy.