Comparative Study On The Profits Theory Between The Austrian School And The Chicago School Of Economics

There is a lot of confusion and unclear in the theory of profit. Rarely have the term in economics such as profit is used in a lot of sense. Economic profits can be as one of the factors of production of income.Entrepreneurs or capitalists obtain it. Profits may be a kind of management income. There are a kind of monopoly profits in economics, more accurately, it is a special kind of rent. It is more important that the mainstream economics promotes the principle of "profit maximization", ignoring the role of economic rent in economic theory and real life. This confuses the difference between profits and rents, ignoring the maximization of rent that the person really pursue. At the same time, new classical economics profit in the mainstream theory ignore the important role of entrepreneurship in economic development.Because the new classical assume the full knowledge in competition, entrepreneurswho respond mechanically in the market do not have any innovation or creation. In this paper, based on the concept of profit in economics, and then I research the1related theory of Austrian&Chicago school,compareing the different aspects in both. Through the analysis and comparison, I found that the two different school can coordinate the contradiction, at the same time try to clear the economic theory of rent and profit which are confusing and not clear, then draws the conclusion and enlightenment. in this paper, The profit theory will be complementary when we make them together, drawing a relatively complete theory of profit. The innovation of this article is to interpret the Austrian profits theory from the Angle of the rent of mainstream economics, and compared with the profits theory,of the Chicago school, then put forward the difference and contaction between advance profits (rent).I discover complementary between the profits of the Austrian and Chicago school theory to solve the problem of the nature of the profits. In the real world, entrepreneurs or persons face two basic tasks:on the one hand, they must try to overcome the uncertainty they face, and enables the maximum profits (rent) that they expected, on the other hand, entrepreneurs or persons could not gain full knowledge, so they must bear the consequences of uncertainty, which makes them get profits or losses. But the profit of entrepreneur or persons has no direct influence on their future decisions. In this paper, the basic theory is the before and afterwards profit (rent) of the Austrian and Chicago school,and completement between the theory talent of entrepreneur spirit and the human capital investment each other. Profit on time can be divided into the Austrian advanced profit and the Chicago school afterwards; Rent (profit) in advance on the way, both the gifts given to the unique talents, also have acquired human intervention. As a result, the profits can form a more complete theory.Research framework of this paper are as follows:Chapter Introduction major economic theory by pointing out that the rent and profit confused and unclear concepts and the role of entrepreneurs in the economic development of neglect, trying to profit Austrian theory and the Chicago School of Economics contrast this to clarify confusion and unclear; rent and related concepts and entrepreneurs to define and explain. The second chapter is a literature review, a major retrospective study of early economists profit research and modern economists of the Austrian School and the Chicago School theory. Chapters Ⅲ introduces the profit of these two schools. Chapters Ⅳ and Ⅴ is the key point of this article. The fourth chapter by comparing two schools of profit theory, pointing out that two schools in profits theoretically inadequate and complementarity. Austrian theory of profit margins beforehand profit Chicago School of Economics theory is ex post profits, the two seemingly different, in fact, the theory that the two schools are complementary. The main contents of Chapter V is the conclusion sense of real life. Finally, the sixth chapter is a summary of this article.