Bohm-Bawerk stated that present goods, as a rule, are worth more than future goods of equal quality and quantity and that there are three reasons for this. The first reason is that, over time, the supply of goods is expected to grow and thus be worth less in the future. The second is that people are incapable of correctly judging what the future will hold. They are more likely to buy things based on the certain now rather than the uncertain future. The third is that goods in possession now have more time to be invested in long processes, thus yielding a greater output sooner.
Eugen von Bohm-Bawerk was another follower of Carl Menger. He spent some of his time as the Minister of Finance of Austria, and his major works were Capital and Interest, Positive Theory of Capital, Critical Excursions, and Karl Marx and the Close of His System. His main work was destroying all the previous theories of interest on capital and presenting his own.
Friedrich von Wieser was a follower of Carl Menger, and he viewed his work as expanding on Menger’s. Wieser’s major works were On the Origin and Principal Laws of Economic Value, Natural Value, and Social Economics. He actually favored an interventionist state and thought that economic value was “natural” and existed no matter the government at the time. He also was the first to use the phrase “marginal utility” and began development of the concept of opportunity cost.
Leon Walras was a French economist. He was one of the three men who championed the subjective theory of value. His major works were the two volumes of Elements of Pure Economics. Walras also focused on general equilibrium analysis, which looked at every market, as opposed to partial equilibrium analysis, which looks at a few individual markets.
William Stanley Jevons was an English economist and one of the three men who pioneered the Marginal Revolution. In fact, he was the first of the three to discover the subjective theory of value. His major works were A General Mathematical Theory of Political Economy, The Coal Question, Elementary Lessons on Logic, The Theory of Political Economy, and The State in Relation to Labor. In The Coal Question, he writes how (in his time) coal is probably the most important substance in their modern civilization. However, since the supply of coal is finite, it will get pricier and pricier to mine. He then presents the “Jevons Paradox”: if you increase the efficiency of coal-burning machines, the rate of consumption of coal will go up. People can now do the same amount of work with a smaller amount of fuel, thus making the use of that fuel more cost-effective.
Carl Menger also developed a theory of the origin of money. There are no records indicating a political leader created it, and that would have been a pretty huge achievement to leave off the books. It also would have been pretty hard to convince other people to just start randomly using money.
Menger’s theory was that, when a man wanted to trade a specific illiquid good for a different good, he could have traded the illiquid good first for a good that was more liquid. He would have used the more liquid good as a stepping stone to trade for the good that he originally wanted, since, because it is more liquid, the chances went up of the man finding a trade for the good he really wanted. Because of the man’s willingness to use the more liquid good as a stepping stone, the more liquid good became even more marketable. Eventually, a good or goods became so marketable that they could be used for almost every transaction. This became money.
Carl Menger was one of the three men who individually developed the subjective theory of value and began the Marginal Revolution. His major works were Principles of Economics, The Errors of Historicism in German Economics, and “On the Origin of Money” in Economic Journal.
The Marginal Revolution was the discovery of the subjective theory of value and the transition from the labor or cost theory of value to such. There were three men who individually completely developed the subjective theory of value at around the same time: William Stanley Jevons, Carl Menger, and Leon Walras.
Carl Menger engaged in a “battle over method” with Gustav von Schmoller, a member of the German historical school of economics. The German school held that there were no general economic laws, that everything was too complicated to derive principles, and that everything depended on the specifics of the time. Menger, on the other hand, held that the laws of cause and effect held true for all sciences, not just the natural ones.