Let me repeat part of what I wrote privately to Aimee and Steve about this issue. Mises, following the original neoclassical idea of wealth, defined it in terms of the utility from consumer goods, which of course is not measurable or even meaningful except insofar as one's goal is to evaluate claims that wealth can be increased or decreased in some way. What economists currently call "real output" does not correspond to the original, or to Mises's idea, of wealth. It is a creation of the statisticians. So the idea of a cycle revolving around a trend line of real output cannot accurately represent Mises. Whatever might be the trend in whatever we call economic growth, the Austrian theory of the cycle that he proposed regarded the boom as a period of malinvestment. This means that whatever meaning we attach to the value of the goods and resources that would have existed without the malinvestment, the malinvestment would reduce that value below what it otherwise would have been. Doug's says that "Mises has some very clear remarks on the causes of long run growth, and its capital accumulation." I would recommend a more careful reading. From chapter 28, section 7, of Human Action comes: "The idea of capital has no counterpart in the physical universe of tangible things." Mises's statements about the amount of capital or stock of capital were, so far I as I can tell, highly contextual. To apply them to some modern, generally accepted notion of economic growth is hazardous. There are in Human Action some highly contextual statements about how net saving characterizes a "progressing economy." But Mises cautions readers about attaching any significance to the concept of a progressing economy. "The precariousness of these three imaginary constructions is to be seen in the fact that they imply the possibility of the measurement of wealth and income. As such measurements cannot be made and are not even conceivable, it is out of the question to apply them for a rigorous classification of the conditions of reality." (chapter 14) A closer reading of the context of his remarks on the progressing economy show that his main goal in using this concept was to elucidate the role of competing entrepreneurs in distributing whatever gains one might associate with progress (chapter 15). To actually specify such gains or to say anything non-tautological about how they come about was not Mises's intention, as I understand him. Pat Gunning