The recession and Austrian business cycle theory: An empirical perspective

Critical Review 7 (2-3):277-306 (1993)
Abstract
How well is Austrian business cycle theory corroborated by empirical evidence? This question is addressed by examining the contraction of 1990?1991 and the expansion leading up to it. An overview of the Austrian theory of the business cycle permits the identification of several empirical propositions implied by the theory. Empirical data for several economic variables are examined for consistency with the patterns suggested by the theory. The evidence suggests a muted Austrian cyclical process at work in conjunction with other factors during the time period studied.
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