Standard macro theories have the same analytical structure as their micro counterparts. Where micro theories work with equilibrium between supply and demand for particular products, macro theories work with equilibrium applied to aggregates of products. This common approach treats the...

Traditional Austrian cycle theory starts from general equilibrium and explains how an expansion of bank credit unmatched by an expansion of saving can create a cycle of boom-and-bust, and with the bust followed by restoration of normality. In contrast, this paper offers a non-equilibrium...