The best books to learn Austrian economics

While not explicitly from the Austrian School, Hazlitt’s book is perhaps the most popular “gateway drug” of sorts, guiding interested readers to the Austrian School.

What is the “one lesson” Hazlitt boils economics down to? All economic decisions have “opportunity costs.” In short, when we choose to use a resource for X, we forgo the opportunity to pursue Y. If you spend $5 on milk, that $5 is no longer available to buy eggs or bread. When a ton of steel is used in building a bridge, it is no longer available for use in building a skyscraper.  

What should be easily intuitive is often readily overlooked, especially when debating government spending. Hazlitt’s book is a great introductory piece written for the layman as he masterfully leverages this “one lesson” to explore several aspects of public policy.

Often credited as the book that launched the “Austrian School,” Menger’s 1871 masterpiece marked a revolutionary correction in the widely accepted theory on the source of economic value prevailing at the time. Menger convincingly made the case that the economic value of goods comes from the mind of the individual–not from the labor inputs used to make it.

Menger further explained that people evaluate the value of goods on the margins–that is, of the next marginal unit–and not just of a good in general. This insight was so profound that it kicked off what was called the “marginal revolution” in economic science. 

Menger also covers price theory, the role of time in production, and the origin of money. This book is a must-read for anybody wanting a thorough primer on the Austrian School of Economics. 

Mises was often referred to as the “godfather of Austrian Economics” for his voluminous contributions to economic science. This book is his most well-known and hefty treatise. 

Mises expertly walks the reader through his explanation of economics being a branch of praxeology, the study of the implications of human action. With a passionate writing style, Mises pulls no punches on his critics while providing the reader with a graduate-level economic education without the often-confusing technical jargon academic courses often impose on students.

Mises uses explanatory language rather than mathematical equations and graphs to make his points. The book is not light reading, however, and should not be attempted without first gaining some understanding of the Austrian School of Economics. And weighing in at nearly 900 pages, expect to set aside some time to get through it. But it will be time well spent.

As the most accomplished student of Ludwig von Mises, Rothbard is undisputably the American who has contributed the most to the Austrian School of Economics. Similar to Human Action, this treatise spans more than 1,000 pages and covers nearly every aspect of economic theory imaginable. 

Rothbard methodically walks the reader through the logical implications of the “action axiom,” the notion that humans act with a purpose in mind. Specifically, humans utilize means according to an idea to achieve ends. From this self-evident building block, Rothbard deduces economic laws that guide nearly the entire edifice of economic science.

The Power and Market section is where theory meets practice, and Rothbard applies the Austrian School theory to diagnose the impact of a large variety of government interference in the market process.

Bohm-Bawerk is too often overlooked when discussing influential Austrian School economists. This is a shame because his work included significant insights and new contributions to economic science. This book, written in 1888, is no exception. 

In this book, Bohm-Bawerk uncovers the origin of the phenomena of interest to be man’s time preference. That is, humans value present goods more than future goods. Thus, the important implications of the passage of time in the production process are examined in this book, including a discussion of why this concept refutes Marx’s labor theory of value and his conclusion that capitalism exploits workers.