The Austrian School in the Interwar Period

The dismissal of academics from German universities under the Restoration of Civil Service Act from 7 April 1933, which enabled the Nazis to fire scientists because of racial and/or political reasons, and the expulsion of academics from Germany, and after the ‘Anschluss’ in March 1938 also from Austria, interrupted or destroyed promising developments in economics as well as in physics and other fields. This caused a negative turning-point for the long-term development of sciences at German-speaking universities. German and Austrian economics fell behind internationally and had to undergo a laborious catching-up process after 1945 without being able to fully compensate the loss of qualified personnel in the following decades. In contrast, the economists who had been driven out of Germany and Austria not only enriched the development of their specialized areas in their host countries, but also made decisive contributions to the international standard of research. This holds in particular for the United States, which was the direct or indirect destination for some two-thirds of German-speaking émigré economists, and which also became the new home for ‘Austrian economics’.