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1996 | Buch

Historicism and Organicism in Economics: The Evolution of Thought

verfasst von: Jacob Jan Krabbe

Verlag: Springer Netherlands

Buchreihe : Ecology, Economy & Environment

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This study looks at the roots of German legacy historistic and organistic economic thought, gives a survey of its development and indicates the present-day significance of these ideas. This approach is also of significance for today's institutional economics, and for the field of environmental and resource economics. In this book these fields of study are referred to in various ways. Essentially, some new ideas appear to be rather old and, what amounts to the same, some old ideas appear to be topical. This is particularly true of the "historical approach" to the economy, with its idea of development. It is also true of the organistic approach, which is largely tied up with it. The point of departure is my study on· the G. erman Historical School, published in Dutch in 1983. The scope of the following work, however, is broader, as it also refers to the evolution of historically oriented and organistically oriented economic thought in general. Thus, a number of authors who did not think along the lines of the Historical School are included. For instance, the organically oriented ideas of Menger and Georgescu-Roegen are also examined, as well as the ideas of those who were among the "Institutionalists" and other present-day writers in this field. This study is supported by various publications by other writers. A great part of the literature under consideration is in German.

Inhaltsverzeichnis

Frontmatter
Chapter 1. Concept and Its Matrix
Abstract
In nineteenth-century Germany a special orientation of economic thought developed which has become known as the Historical School. After the Napoleonic conquests, the socioeconomic system of what was still an agrarian and feudal society began to develop rapidly. In this cultural climate a historically and organically oriented type of economic thought flourished, which was focussed mainly on economic development. The idea of development was partly formulated in organic terms, which later came to be expressed by the Darwinian term “evolution”. The present study is concerned with this way of thought: what it means, what its roots were, and what its significance to economics is.
Jacob Jan Krabbe
Chapter 2. Predecessors of German Historicism
Abstract
Medieval Scholastic philosophy was superseded by Mercantilism, in which matters of economic policy were seen from the point of view of the sovereign or the state. In the eighteenth century Mercantilism was strongly influenced by the ideas of the Enlightenment. An example of this is the work of the British Mercantilist James Steuart (1767, 1805 I: pp. 2, 7, 199). Mercantilist thought was transformed into the philosophy of the Physiocrats and eventually into that of the mainly British Classical School, the principal heir to the Physiocrats’ legacy. The Classicals modified the Physiocratic idea of production and analysed the economic process further. The link between these last two schools was Turgot. This “classical” way of thought was the great antipode of German historicism.
Jacob Jan Krabbe
Chapter 3. Phenomenon “Historical School”
Abstract
Before looking at the typical ideas of various members in the school of which some forerunners have already been mentioned, I want to look for a moment at the phenomenon of the Historical School as such, for questions arise about what the concept of “school” here is and how this school should be described.
Jacob Jan Krabbe
Chapter 4. The “Older” Historical School
Abstract
I fully agree with the idea that Roscher was the founder of the Historical School. He was the dominating personality in the “older” School and was also acknowledged as such by his contemporaries, including his kindred spirits, Knies and Hildebrand. Their ideas can be considered to complement those of Roscher, and therefore they can be seen as co-founders alongside him.
Jacob Jan Krabbe
Chapter 5. Independents in the School’s Second Generation
Abstract
Two outstanding members of the second generation of the Historical School I call “independents”: Karl Bücher and Eugen Philippovich. The arguments for this I mentioned in the last section of Chapter 3. On the one hand, just like Schmoller, these members accepted Roscher’s patrimony. On the other hand, in various respects they distanced themselves from Schmoller and his disciples. Like Roscher, they aimed at a synthesis with deductive economics. Schmoller, however, was inclined to stress the methodological contrast that had developed between the Classicals and the founders of the Historical School.
Jacob Jan Krabbe
Chapter 6. Menger’s New Organicism
Abstract
Carl Menger, originally von Menger, was born in 1840, at “Neu Sanden”, in what was then Austrian Galicia. He studied law in Vienna, Prague and Cracow. After serving the Austrian court and government, he was appointed to a chair at the University of Vienna, where he lectured in economics. Menger became famous as the founder of the Austrian branch of the School of Marginal Utility. Discovering a “protoneoclassical” tradition in nineteenth-century German economic thought, Streissler suggested that Menger’s ‘formulation of marginal productivity in marginal utility terms and its application to all factor remunerations in exactly the same manner’ should be placed against this background (Streissler, 1990: p. 59). Menger also became well-known as a methodologist who allowed space for organically oriented ideas. I focus on him in the last function. In this connection I use the term “new organicism”, considering it, on the one hand, a modern version of Wilhelm Roscher’s organicism, drastically transformed, and, on the other, an entirely new approach. The term is reminiscent of Francis Bacon’s Novum organum, characterized by empiricism and inductive logic. I have pointed out elsewhere, when discussing this issue (1993a), that I do not consider this problematic since Menger himself approvingly referred to this work.
Jacob Jan Krabbe
Chapter 7. Schmoller, Founder of the “Younger” Historical School
Abstract
Gustav Schmoller, later von Schmoller, was born in Heilbronn in the German state of Wurtemberg, in 1838. He studied Staatswissenschaften, “public administration”, in Tübingen. In the Germany of that time, this branch of studies still bore the stamp of Camera-list thought. As a professor he lectured on this subject at the Universities of Halle, Strasbourg and, finally, Berlin. He was the main initiator and, for a long time, chairman of the Verein für Socialpolitik, founded in 1872, in which he was a propulsive force behind studies in socio-economics and German economic history. For Schmoller, economic history and history of economic thought were strongly linked. He was the dominant figure in what was called the Younger Historical School, in which he had many disciples. He also became influential at the Emperor’s court in Berlin. In this position he promoted the study of economics in Prussia and the newly established Empire according to his own ideas, which were in part also those of Bismarck.
Jacob Jan Krabbe
Chapter 8. Schmoller’s Followers in the “Younger” School
Abstract
Until the beginning of the twentieth century, Schmoller’s “younger” Historical School was an important movement in German “political economy” and socio-economic history. Of the many authors in this field I want to mention a few who are of special significance to historistic and organistic thought: Conrad, Cohn, (Lujo) Brentano and, further, Held, Inama, Knapp. The first three I characterize as “reformers”, since they had a militant attitude towards socio-economic reform. The last three I see as “fundamentalists”, for they concentrated mainly on principles of this way of thought. However, the cynical description “Socialists of the Chair” referred to all of them. This name was adopted from the critical publication Kathedersozialismus, written by the nineteenth century liberal, Heinrich Oppenheim.
Jacob Jan Krabbe
Chapter 9. Historical School’s “Youngest” Representatives
Abstract
In the first quarter of the twentieth century, the economists Werner Sombart and Arthur Spiethoff and the sociologist (Max) Weber built their theories, to a large extent, on the ideas of the Historical School. However, I would not consider them part of this school proper, as their ideas were too original and too universally oriented. Nevertheless, their affinity to the school was strong enough for me to denote them “youngest representatives”, following Schumpeter (1954: p. 815).
Jacob Jan Krabbe
Chapter 10. Institutionalism
Abstract
Historistic and organistic ideas are also found in the American School of Institutionalists, founded by Veblen and, in its first stage, shaped by writers like Commons, Mitchell, (Walton) Hamilton and (John Maurice) Clark. The British “Fabians” had similar ideas, as did Hobson, who was inspired by Veblen. These authors laid the foundation for present-day evolutionary-oriented thought on economic institutions, with names such as Galbraith, (Clarence) Ayres, Gruchy and Myrdal. In Germany, a number of writers followed an almost similar line of thought, directly influenced by the Historical School. Mention is made of Wagner, Dietzel, Herkner and Eucken. Environmentally oriented Institutionalism is mentioned as well. The chapter also refers to the institutional ideas of Schumpeter and Tinbergen. Finally, several present-day ideas which are rather close to the Institutional approach are discussed.
Jacob Jan Krabbe
Chapter 11. Georgescu-Roegen’s “Bioeconomics”
Abstract
Nicholas Georgescu-Roegen was born in Constanza, Romania, in 1906. He studied mathematics, statistics and economics in Bucharest, at the Sorbonne in Paris, and at University College, London. He was Professor of Statistics at the University of Bucharest and visiting fellow at Harvard. Before and during the Second World War he held positions in the Romanian government. After the war he settled down in the United States, where he became Professor of Economics at Vanderbilt University (Dragan and Demetrescu, 1986, 1991: pp. 6–7). Georgescu-Roegen referred to Menger only in connection with the hierarchy of wants and on a few other points. Nevertheless, it is clear that Menger preceded him in various respects. Nicholas Georgescu-Roegen elaborated Carl Menger’s thought in a creative and synthetic way, also taking notice of the idea of “ordered systems”, put forward by systems-oriented authors like Gustav Schmoller.
Jacob Jan Krabbe
Chapter 12. Economic Aspects of Cultural Diversification
Abstract
In nineteenth-century Germany, nationalist ideas strongly influenced large parts of politics and “state sciences”, of which this study is proof. However, there are many types of nationalism. Since the collapse of the Soviet system, the world has been confronted with various manifestations of it. It has become clear that not all of its forms have a positive effect on the stability and efficiency of the institutional system. The effect is negative if nationalism suppresses all criticism of the nation’s own habits and customs, and if it enforces antagonism with neighbouring states and minorities within its own borders. However, if it focusses in a critical way on improvement of the culture of its own state and is based on respect for the other man’s way of life, the effect is positive.
Jacob Jan Krabbe
Chapter 13. Economic Systems Theory
Abstract
The first report by Club of Rome, The limits to growth (D.H. Meadows et al.), appeared in 1972 and contributed considerably to the opening of the eyes of the world to the seriousness of the present-day’s environmental problem. It convinced many scientists of the significance of “systems thinking”, in both quantitative and qualitative terms, for solving problems in the field of interactions between economy and natural environment. This way of thinking was mainly mechanistic, which put a stamp on its conclusions. Jay Forrester (1971) supplied the basic model. His son, Nathan Forrester (1973), and D.L. Meadows et al. (1974) made it clear that such models can have an organic trait, giving attention to “life cycle” aspects. The Club of Rome’s second report had a clear organistic dimension (Mesarovic and Pestel, 1974).
Jacob Jan Krabbe
Chapter 14. Efficient Sustainability: An Institutional Approach
Abstract
This chapter is an application of institutional principles which are rooted in historistic and organistic thought.104 In both the Historical School and circles of Institutionalists it was understood that the institutional structure is an important issue in economics. This was also concluded by Johan Torstensson (1994), who investigated the impact on economic growth of well-enforced versus not well-enforced property rights. He found that arbitrary seizures of property, taken instead of regular taxes, decelerate growth, and insecure property rights leads to an inefficient allocation of capital. However, the institutional structure itself is also of great importance for achieving efficiency in society.
Jacob Jan Krabbe
Chapter 15. Perspectives of Organistic Thought
Abstract
Economic development can be outlined in various ways, according to how it is analysed. This particularly applies to the process of industrialization of the Western world. So, two contrasting ideas of development can be put forward. Economic science arose from the philosophy of the Enlightenment, a way of thinking that has left a lasting stamp on economic thought. This has the advantage that explanations of the functioning of nature put forward by physicists can easily be assimilated into the pattern of economic thinking A disadvantage is that economic thought can easily function as a sounding board for aprioristic optimism about economic development in the future. This is because welfare optimism, being a long-standing characteristic of economics, is rooted in Enlightened thought. In the latter philosophy, a continuing interweaving of “reason” in the thinking about the organization of society, is the propelling force in social development.
Jacob Jan Krabbe
Chapter 16. Epilogue
Abstract
Finally, I want to consider what the basic ideas of my history-of-thought-oriented study are. I want to pose the question of the “significance” of this study. Publications of former writers should be seen in the context of the philosophies of their day, of the socioeconomic paradigms which were valid then, and of the topical social economic problems of the era, such as the urge for economic development and the need for social security. As such, these works possess their own significance. However, there is more to be said about the background of studies on the history of economic thought. Further to my remarks in Chapter 3, on the prima facie subject of the Historical School, I want to point out that approaches of the past, and the economic problems from then, are related to the modern method which should be followed, and the present-day problems which must be coped with. This gives an extra dimension to the subject matter. To a certain extent earlier scientific and political problems coincide with present topical problems in the same fields. Of course, present-day scientific and political pictures, with their emphasis on natural environment and resources, have a unique aspect also. New problems require new solutions, which should be more convincing than those inherited from the past.
Jacob Jan Krabbe
Backmatter
Metadaten
Titel
Historicism and Organicism in Economics: The Evolution of Thought
verfasst von
Jacob Jan Krabbe
Copyright-Jahr
1996
Verlag
Springer Netherlands
Electronic ISBN
978-94-009-1689-0
Print ISBN
978-94-010-7256-4
DOI
https://doi.org/10.1007/978-94-009-1689-0