Austrian persistence? Capital-based business cycle theory and the dynamics of investment spending

Survey data are used to investigate the very long spending lags estimated in neoclassical studies of investment expenditures. Neoclassical investment theory has trouble explaining the length of these lags. By recognizing the Austrian concept of the capital structure and applying it to the problem, the present paper explains the length of these lags as proceeding from interactions between types of capital. Austrian arguments stemming from Austrian business-cycle theory seem to be needed to explain these lags. [PUBLICATION ABSTRACT]