2. From Beginning Until the World War I

In the second half of the fifteenth century, a moderate Hussite, Jiří of Poděbrad, faced Catholics backed by the Hungarian King Matyas Hunyadi, who ruled for most of the second half of the fifteenth century, was a Renaissance personality who founded a library of ancient and current literary and humanist writings, destroyed later in the Ottoman invasions.

The Habsburg Monarchs, who ruled in the sixteenth century have considered Protestant as heretics and fought against both the Ottomans as well as Protestants. They wasted revenues from Spanish America’s silver mines in fights over the Spanish throne and drove several Protestant merchants, artisans, and financiers into exile.

Evans (2006, p. 85) describes the situation after 1620: “All Protestant lords and burghers in Bohemia and Moravia, however loyal their record, had to tread the path of exile, while all peasants faced forced conversion. Meanwhile the Catholic prelates regained their rank as the first estate of the realm, 200 years after the Hussites had humbled them. Ecclesiastical lands were reclaimed, or in lieu of that a financial settlement was stipulated. New churches and monasteries began to spring up and the Jesuits laid claim to a dominant role in the purified educational system.”

By the 1560s, Hungary’s Calvinist ‘Reformed Church’ had become Hungary’s largest religious denomination.

Barta (2004), Dobos (2011), and Erdősi (1963). Erdősi (1963) provides a translation of Wernher’s book based on the edition issued in Köln in 1595.

Dóczy et al. (1934, p. 15) put the publication of Wernher book to 1505. However, multiple other sources confirm that it was published in Basel in 1549. Dóczy et al. (1934) mention that this work was republished numerous times in different languages, for example, in Vienna in 1551, in Köln in 1563, 1591, 1595, and in Frankfurt in 1600. Scriptores rerum hungaricarum veteres (Hungarian Ancient Writers), Vienna (Vindobonae) 1746, edited by Johann Georg Schwandtner, a student of Matej Bel, also reprinted Wernher’s work.

Barta (2004), Bán (1962), Csohány (2013).

It contains paragraphs on Treasury under Emperor Augustus, the economy under Caligula and Tiberius. Szent-Iványi refers to the authors who inspired him. For example, he mentions the Politicorum of Aristotle; he quotes Diego de Saavedra Fajardo, Adam Contzen, and especially the Belgian Laurens (Laurentius) Beyerlinck. Szentiványi was also quoting French Honoratus Fabrius (1608–1888), a Jesuit theologian and mathematician, and also Athanasius Kircher (Kircherus) (1602–1680), a German Jesuit polymath, and the work of Christoph Fischer (1611–1680) Opus oeconomicum (Unčovský 2011, pp. 103–104).

However, in 1773 the Sejm established a Commission for National Education entrusted with re-organizing schools into a single countrywide education system. The Commission was headed by a team of enlightened aristocrats, endowed with part of the wealth of the dissolved Jesuit Order dissolved.

Still, by twentieth-century standards, it was a mild police state. The state kept relatively few political prisoners, made little (if any) use of torture, and kept no camps for its enemies.

Unčovský (2000), Hamza (2017), Baláži (2018), Ilina (2014), Špirko (2009), and Wortman (1976).

The spelling of his name appears in various forms. In Russian, Михаил Андреевич Балугьянский, Mikhail Andreevitch Balugyanskij, Michal Baluďanský in Slovak, Balugyánszky Mihály in Hungarian. Also, the determination of his nationality is an intricate issue. The first Czech encyclopedia, Slovník náučný, edited by František Ladislav Rieger, 1860, volume 1, considers him of Slovak nationality and writes his name as Michal Baluďanský. Russian Enciklopeditcheskij Slovar, published in 1891 in Saint Petersburg, considers him a Carpato-Russian born in Hungary. Wortman (1976, p. 39) considers him a Hungarian scholar and spells his name as M. A. Balugianskii.

Haan (1879), Deák (1984), Tóth (2017), Kirschbaum (2007), Láng (1913).

One of Berzeviczy’s favorite topics is demography. Berzeviczy, similarly to Schwartner, discussed later, thought that the Hungarian Kingdom was under-populated. Both Schwartner and Berzeviczy believed in Smith’s idea that the capitalist system with free capital and labor movement would provide the optimal population size. Horváth (1964), Unčovský (1956).

Láng (1913), Lukcsics (1914).

Hungarian, predominantly Catholic, students who studied outside Hungaria, peregrinatio academica, had studied already in the fourteenth century at the newly established universities in Prague (1347), Wien (1364), Cracow (1365), Heidelberg (1386), Leipzig (1409), or Tübingen (1477). Studying abroad became more widespread after the Reformation period. In the first one hundred years of Göttingen University, almost five hundred Hungarian students enrolled. This number was smaller than at Halle or Jena, but typically, the Göttingen studies were considered more serious and more progressive. Futaky (2007, p. 56). Lukcsics (1914, pp. 14–15) mentions that Schlözer criticized those sending their children to lower-level colleges instead of Göttingen as that influenced the intellectual level in the Hungarian educational institutions. Lukcsics adds that Hungarian students mostly followed where stipends were available, and those universities were cheaper than the elite German colleges.

Schwartner, similarly to Berzeviczy, was under pressure by nationally oriented scholars who lacked in his work sufficiently blossoming national spirit. Historian István Horváth (1784–1846), initially Schwartner’s student and admirer, performed this critique in the case of Schwartner. Schwartner suffered a great deal from these attacks (Lukcsics 1914). However, even Láng (1913, p. 32) criticizes Schwartner for critical remarks toward national endeavors.

Schlözer’s work Kritische Sammlungen zur Geschichte der Deutschen in Siebenbürgen, published in the last years of the eighteenth century, infuriated Hungarian national spirit. In 1781 Joseph II ruled that the three predominant peoples of Transylvania, the Saxons (Sachsen), the Hungarians, and the Szeklers (Székely), should become equal under the law. The representatives of Saxons protested as that meant the loss of privileges allocated to them centuries ago. They turned to Schlözer for help. He took the side of the Saxons, showing how much Hungarian culture owed to the German creativity (Futaky 2007, pp. 22–23).

Schwartner finishes his statistical work in 1796 and subjects it to the censor, and he receives his manuscripts back after half a year. In this publication, the censor suggested making almost a hundred changes to alter the character of discourse, often reminding the reader of the spirit of Enlightenment. He was fortunate that the censor of this work was János Keresztély Engel (Johann Christian von Engel) (1770–1814), a famous Hungarian historian who finally recommended publishing (Lukcsics 1914, p. 52).

He reviews different population birth registers and based on them, and different other data sources, he provides birth rates, death rates, and marriage statistics basically for all towns in the Kingdom. He provides detailed data about trade and different professions, and presents ‘national characteristics’ of different ethnicities as their high or low propensity to trade, save, avoid, or keep the work discipline, and similar. Note that Schwartner called Pest “das zukünftige London” when Pest inhabitants were less than 60,000, including Buda (Láng 1913, p. 68).

Foreign journals praised his work. Göttingische Anzeigen wrote a favorable review: “In this important work, Schwartner provides first systematic statistics of the Hungarian Kingdom. Already Engel had turned our attention to him, and as we see, he clearly overdid our expectations” (Lukcsics 1914, p. 51).

An extended version was written with Tomáš Krištofóry under the title Early Influence of Adam Smith on the Economic Thought in Central Europe and presented at the Smith’s Society Conference at the University of Palermo in July 6–7, 2017. Conference title was From Scotland to the South of the Mediterranean, the Thought of Adam Smith through Europe and Beyond.

We have already mentioned Schlözer’s article. Spittler had published in his Entwurf der Geschichte der Europäischen Staaten (Draft of the History of the European States) a chapter on Hungary. He emphasized how fast the early Hungarian tribes accepted Christianity and became members of the European community. Interestingly Spittler’s book became prohibited in the Habsburg Empire. As the censor emphasized, this book could harm those who are not well versed in the dominant ideas of the time (Futaky (2007, p. 29; Fata et al. 2006, p. 182).

The Czech historian Palacký, as well as other intellectuals, predicted the rise of pan-Slavism as a natural response to a dualistic agreement between Austrians and Hungarians. Some Hungarian historians saw it differently and emphasized that the Compromise secured the Hungarian constitution and independence. Some other historians observed that the Compromise by reducing Slavs to obedience might have negative consequences for the Hungarians and the Monarchy. Also, not everybody in Austria favored the Ausgleich and would rather see an alliance with Germany, which would allow the Germanization of the Slavs (Tihany 1969, p. 120).

Bekker (1998, 2002, 2004), Harmat (1980), Lang (1909), Mátyás (2005).

Bekker (2004) mentions sources as Jevons, W. Stanley, The Theory of Political Economy, Macmillan, London, 1888. Preface, XXXI; Knies, Karl, Politische Oekonomie vom geschitlichen Standpunkte. Hans Buske, Leipzig, 1930. 522–523; Marshall, Alfred: Principles of Economics. 3rd edition, London, 1885, 54–55; Schumpeter, Joseph: Epochen der Dogmen und Methodengeschichte, Tübingen, 1924, I. volume, 20, and others. In the Introduction to the History of Economic Analysis by Schumpeter, Routledge 2006, Mark Perlman on page x—when discussing lines of thought which left to Schumpeter’s versions of the history of thought—mentions Kautz in what he calls the German lineage: “There is a German lineage, as well. Wilhelm Georg Friedrich Roscher first brought out his Geschichte der Englishen Volkswirtshaftslehre (1851) and then later in 1874 his Geschichte der Nationalökonomie in Deutschland, and his student, Gyula Kautz, published in 1860 Die Geschichtliche Entwicklung der Nationalökonomie und Ihrer Literatur.” What Perlman mentions is the second volume of Kautz’s book. Translation of this book appeared in Hungarian only at the beginning of the twenty-first century, in 2004, in Publishing House Aula, 628 pages, translated by Bródy András, Frenkel Gergely, Hild Márta, and Horváth László.

Count Széchenyi (1791–1860) was an iconic figure of the Hungarian reform program. Together with other Hungarian liberals, he was aware of the Kingdom’s relative backwardness. In the decades before 1848, typically called the ‘Reform Epoch,’ there were efforts to improve Hungarian agriculture, administration, transportation, and similar. Széchenyi personally played an essential role in these efforts, as he was involved in the building of the first Danube bridge, the first steamship line, helped to create the Hungarian Academy of Sciences and other great projects. Széchenyi advocated the abolition of serfdom, expansion of education, and facilitating the selling of land to encourage investment in a commercial-agricultural revolution. Besides, Szechenyi counseled against attempts to impose the Magyar language on the minorities. Contrary to his views, in 1844, the Diet declared Magyar to be the official language of the Kingdom of Hungary, even though Magyars comprised only 37% of the population (Janos 1982, p. 11). Also, Szechenyi preferred collaboration with the Habsburgs and the non-Magyar minorities. However, during the 1840s, the political initiative had passed to a more radical nationalistic gentry headed by Lajos Kossuth (1802–1894). In the economic sphere, Kossuth advocated industrial subsidies and an interventionist strategy of state-induced industrialization and emphasized that Hungary’s relative backwardness stemmed from its dependence on Austria.

Kautz published different work also on Széchenyi. In 1904 he published “Hitel” és a “Világ” méltatása (“The Worthiness of Hitel” and “Világ”) in Gróf Széchenyi István munkái (Works of Count István Széchenyi), MTA, Budapest. In 1905 he published Politikai programmtöredékek A “Stádium”, a’ “Kelet népe” és a “Politikai programmtöredékek” méltatása (The Worthiness of “Stádium,” “Kelet népe” and of “Fragmentation of Political Programs”), in: Gróf Széchenyi István munkái MTA, Budapest. Also in 1905 he published Széchenyi és Kossuth (Széchenyi and Kossuth)), Franklin Nyomda, Budapest.

Doležalová (2013, 2018), Albrecht (1992), Krameš (2014, 2016a, b).

Josef Goldmann probably played a similar role in the 1970s and the early 1980s, when he built up a group of economists in the Economic Institute of the Czechoslovak Academy Science, who played a role in the transformation process.

A more extended version of this topic was written together with Tomáš Krištofóry and presented at the yearly Conference of the European Society for History of Economic Thought in Antwerp in May 2017.

Implicitly, essential for the development of marginalism was the role of Kautz (1860). Jevons (1888, p. 15) has written that it was this Kautz’s book, which got his attention to the work of Gossen. Daal (2012, p. 371) mentions that Kautz commented that Gossen built the theory of pleasure on a mathematical basis that raised the interest of Jevons. Kautz was also in the midst of the debates of the monetary reform of 1892, which sparked discussions concerning the theory of money, including Menger’s view of money as spontaneous evolutionary order.