The Pure Theory of Capital

The Pure Theory of Capital, F. A. Hayek's most detailed work in economic theory, has been long overlooked. First published in 1941, it stood in sharp contrast with fashionable economic thought, which had shifted under the influence of John Maynard Keynes. This edition commemorates Hayek's last major work in economics, which offers a detailed account of the equilibrium relationships between inputs and outputs in a time-filled economy. Hayek's stated objective was to make capital theory - which had previously been devoted almost entirely to the explanation of interest rates - "useful for the analysis of the monetary phenomena of the real world." His ambitious goal was nothing less than to develop a capital theory that could be fully integrated into business cycle theory. Hayek's manifesto of capital theory is now available again for today's students and economists to discover.
The new introduction by Hayek expert Lawrence H. White firmly situates the book in a historical and theoretical context, as well as within Hayek's own life and his struggle to complete the manuscript. It provides important insights into Hayek's theories, the intellectual environment in which he wrote, and the personal context of this important work.