Of triangles and trapezoids: Hayek, Rothbard, and Hülsmann on the structure of production

Kristoffer Mousten Hansen

Chapter 9 in Hayek’s Living Legacy in Economics, Philosophy and Policy, 2026, pp 160-169 from Edward Elgar Publishing

Abstract: In this note we revisit some fundamentals of capital theory in light of recent debates. We argue that the standard Austrian account of the structure of production and the time market as developed by Rothbard is essentially correct and supplement it with an argument for how land factors can be formed out of net saving. The result is that a fall in time preferences always leads to capital formation and a fall in the rate of discount, but the rate of discount may rise again depending on how much capital is invested in new land factors. Some implications for the diagrammatic depiction of the structure of production as a triangle or trapezoid are discussed.

Keywords: Capital Theory; Structure of Production; Hayekian Triangle; Time Preference; Net Saving; Interest Rate (search for similar items in EconPapers)
Date: 2026
ISBN: 9781035394234
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