User:ThoomBOY/Malinvestment

In the Austrian Business Cycle Theory and all of its different frameworks, the actual definition of malinvestment stays the same which is an investment with high potential that becomes worthless. However, it is important to note that a malinvestment only occurs if the investment becomes worthless due to increased interest rates. The classification of a malinvestment is only when there is an increased amount of credit which causes it to become worthless. Many economists believe that malinvestments occur at different times and to certain companies. Åkerman and Dahmén who came up with the Åkerman-Dahmén theory, which is different than the Austrian Business Cycle Theory, believe that a malinvestment will occur during the "boom" to companies who cannot keep up with the interest rate growth.