An Inappropriate Simplification: Introducing the Time Factor into the Theory of Capital in the Form of the Average Period of Production

I had little idea that this task of systematisation would uncover serious gaps in the reasoning which had yet to be bridged, and that some of the simplifications employed by the earlier writers had such far-reaching consequences as to make their conceptual tools almost useless in the analysis of more complicated situations. The most important of these inappropriate simplifications, of the dangers of which I became aware at a comparatively early stage, was the attempt to introduce the time factor into the theory of capital in the form of one single relevant time interval -- the "average period of production". But it gradually became clear that this supposed simplification evaded so many essential problems that the attempt to replace it by a more adequate treatment of the time factor raised a host of new questions which had never been really considered and to which answers had to be found.

--Friedrich A. Hayek, preface to The Pure Theory of Capital (1941; repr., Auburn, AL: Ludwig von Mises Institute, 2009), vi.