735-79), who cite Hayek in a footnote to the following paragraph that explains the difference between endogenous and exogenous cycle
theories: [I]t is generally correct to see the early theories of business cycles as mainly endogenous, that is, concentrating on the internal relations of the economic system rather than on the effects of external shocks; as multicausal, that is, concerned with interactions of the real, monetary, and expectational factors; and as dynamic, that is, incorporating elements of long-term growth into the analysis of short-term instability.
Endogenous and exogenous cycle theorists disagree and consider MC respectively as an endogenous and stochastic element.
A clearly defined dichotomy exists in the business cycle literature between endogenous and exogenous cycles. Exogenous cycles are either temporary, heavily damped random deviations from a stable long-run growth path or permanent stochastic fluctuations in the growth path which both require repeated stochastic impulses to generate typically observed recurrent and irregular fluctuations.