The Genetic-Causal Tradition and Modern Economic Theory

Mario Rizzo, Department of Economics

Abstract

This paper is an analysis of a specific tradition of causal thinking in economics: the genetic-causal tradition. This was most self-consciously developed in the work of the Austrian School, but spilled over into other approaches. Genetic-causal explanations place emphasis, inter alia, on processes in time, emanating from changes in agents' desires and beliefs. The authors present a brief history of this approach, outline its major characteristics, differentiate genetic-causal explanation from other kinds of explanation, and illustrate the approach in mid and late-twentieth century economic theory