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A model of Austrian economicsThe setup of the model

A model of Austrian economics: The setup of the model [All economic activity in the model is borne by decentralized actions of agents. These agents are categorized as households, firms, and banks each assuming the following economic functions. The households buy and consume goods, make investments, and provide labor to firms. The firms, on the other hand, hire labor and purchase capital goods in order to produce and sell goods. The banks, finally, act as the financial intermediaries between households and firms. That is, they manage transactions between non-bank agents, they offer saving contracts to households and loan contracts to firms, and they facilitate purchases of equity (Figure 2.1).] http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png

A model of Austrian economicsThe setup of the model

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Publisher
Springer Fachmedien Wiesbaden
Copyright
© Springer Fachmedien Wiesbaden 2015
ISBN
978-3-658-07076-2
Pages
5 –21
DOI
10.1007/978-3-658-07077-9_2
Publisher site
See Chapter on Publisher Site

Abstract

[All economic activity in the model is borne by decentralized actions of agents. These agents are categorized as households, firms, and banks each assuming the following economic functions. The households buy and consume goods, make investments, and provide labor to firms. The firms, on the other hand, hire labor and purchase capital goods in order to produce and sell goods. The banks, finally, act as the financial intermediaries between households and firms. That is, they manage transactions between non-bank agents, they offer saving contracts to households and loan contracts to firms, and they facilitate purchases of equity (Figure 2.1).]

Published: Aug 12, 2014

Keywords: Reservation Price; Intermediate Good; Consumption Expenditure; Investment Bank; Supply Curve

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