Mises’s Human Action is a hefty read, but the first hundred pages or so gives you the entire outline of praxeology and the Austrian perspective. Normally I’d never think of suggesting the book to a non academic type (because of its weight and depth). But for people who are serious about business, making money, and corporate strategy I think the Austrian school has important lessons to be learned.

For example, Steve Balmer, Microsoft’s CEO can be seen in this YouTube clip laughing at what he considers to be the outrageous price tag on Apple’s new iphone ($500). I want to smack the guy and make him realize that competition amongst firms is not about putting out a specific product thats’ better and cheaper. It’s about satisfying the wants of customers better and cheaper. People buy phones or mp3 players or whatever not because they have to have that specific gadget. They buy these things because they meet some set of needs that they have.
I’ll bet if someone had told a company selling $30 portable CD players a few years ago that they would be out competed by a product that costs $350 (Apple’s ipod), they would have laughed too. But who’s laughing now? By the time you think about all of the costs and benefits associated with listening to portable music, ipods are a good buy for a lot of people (the bulk of the market). CD players were marginally bigger, often skipped, sucked down battery power, and played one CD at a time. Listeners would have to carry around the player, the CDs, buy expensive storage cases, the list goes on and on. Apple came in and with a single product made this activity so much easier and more enjoyable, and discovered a price strategy that worked. The new plan for the iphone seems really similar. They aren’t saying lets make the best phone. They are setting out to meet the needs of phone users.