Austrian business cycle theory was developed by Hayek and Mises in the 1920s, and Hayek's main contribution to the field came out soon after. It argues, in a nutshell, that the reason for any crisis of capitalism lies not in the moment and context of crisis itself. Treatment should be for the boom, not for the bust. Crises, in this shorthand, become malformations of mishandled growth processes and responsibility for them can thus be laid at the doorsteps of politics. As a result of such a position (which Hayek revised throughout the 1930s after a spate of criticism), those suffering from economic crises would be left without any support until markets rebalance and new employment emerges. Beside more obvious critics of such a position, such as fellow macroeconomist and welfare theorist John Hicks, even Milton Friedman later criticized Austrian business cycle theory for its apparent prescription of letting "the bottom drop out of the world."

Dieter Plehwe, Quinn Slobodian & Philip Mirowski (eds.), Nine Lives of Neoliberalism, loc. 395