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Principles of Economics Study Guide
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At a time when Marx pretended to deduce his “iron law” of wages and
exploitation theory of profit from the classical labor theory of value, Menger’s
Grundsätze der Volkswirtschaftslehre marked no less than a renaissance of
economic science.
For that reason, this masterpiece constitutes the best introduction to
economics. Not only because Menger elucidates its fundamental principles,
covering the theories of goods, value, exchange, price, production, money, etc.;
but, more essentially, because he roots them all in the concrete actions of
economizing individuals.
It is true that Menger had predecessors. Among them, Étienne Bonnot, abbé de
Condillac, deserves particular attention as one of the Great-fathers of the
Austrian school1. –In what follows, we indicate where Menger borrows from
his illustre ancêtre.
It is also true that Menger’s book needed developments, and even corrections.
–In what follows, we also indicate such insufficiencies.
But, between those two limits, Menger’s own genius is undeniably at work.
Some of its products are common knowledge, nowadays—e.g., his theories of
marginal value, or of the nature and origin of money. Others have
unfortunately been forgotten—e.g., his theories of property, and of property
rights. If it is a great intellectual pleasure to re-discover the latter; it is another
one to rediscover the firsts, which come into new light, and take back their
original colors, as soon as one comprehends the whole of Menger’s book