Uploaded July 2026 | Updated September 2026, 2 weeks ago
In the opening lecture of Mises University, Joseph Salerno returns to 1871, when Carl Menger's Principles of Economics launched the Austrian school. Salerno shows how Menger's law of marginal utility solved the ancient "paradox of value"—why life-giving water is cheap and useless diamonds dear—and, in doing so, moved economics away from the classical focus on the businessman and cost, and toward the acting, wanting human being.
Recorded at the Mises Institute in Auburn, Alabama, on July 20, 2026.
Mises University is the world's leading instructional program in the Austrian School of economics, and is the essential training ground for economists who are looking beyond the mainstream.
0:00 The Marginalist Revolution: Menger, Jevons, and Walras
2:54 Ordinal vs. Cardinal Utility: Menger vs. the Mathematical Economists
4:14 Menger's Achievement: A Full System Based on Subjective Value
5:39 Why Menger Built a New Economics: Observing Markets as a Journalist
7:30 The Classical School's Fatal Flaw: The Water-Diamond Paradox
17:14 Subjective Wants and Objective Goods
23:43 Economizing Man vs. Homo Economicus
25:07 The Law of Marginal Utility
30:05 The Sacks of Wheat: Marginal Utility in Action
44:05 Menger on Exchange: The Double Inequality of Value
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In the opening lecture of Mises University, Joseph Salerno returns to 1871, when Carl Menger's Principles of Economics launched the Austrian school. Salerno shows how Menger's law of marginal utility solved the ancient "paradox of value"—why life-giving water is cheap and useless diamonds dear—and, in doing so, moved economics away from the classical focus on the businessman and cost, and toward the acting, wanting human being.
Recorded at the Mises Institute in Auburn, Alabama, on July 20, 2026.
Mises University is the world's leading instructional program in the Austrian School of economics, and is the essential training ground for economists who are looking beyond the mainstream.
0:00 The Marginalist Revolution: Menger, Jevons, and Walras
2:54 Ordinal vs. Cardinal Utility: Menger vs. the Mathematical Economists
4:14 Menger's Achievement: A Full System Based on Subjective Value
5:39 Why Menger Built a New Economics: Observing Markets as a Journalist
7:30 The Classical School's Fatal Flaw: The Water-Diamond Paradox
17:14 Subjective Wants and Objective Goods
23:43 Economizing Man vs. Homo Economicus
25:07 The Law of Marginal Utility
30:05 The Sacks of Wheat: Marginal Utility in Action
44:05 Menger on Exchange: The Double Inequality of Value
Find free books, daily articles, podcasts, lecture series, and everything about the Austrian School of Economics at https://Mises.org.
X ► https://x.com/mises/
Facebook ► facebook.com/mises.institute
Instagram ► instagram.com/misesinstitute
SoundCloud ► soundcloud.com/misesmedia
Apple Podcasts ► podcasts.apple.com/us/artist/mises-institute/1280664810
Rumble ► rumble.com/c/c-2212754
Odysee ► odysee.com/@mises
Podcasts ► mises.org/podcasts
