The Visionary Realism of German Economics

Erik S. Reinert

Description

A collection of Erik S. Reinert’s essays

‘The Visionary Realism of German Economics’ forms a collection of Erik S. Reinert’s essays bringing the more realistic German economic tradition into focus as an alternative to Anglo-Saxon neoclassical mainstream economics. Together the essays form a holistic theory explaining why economic development––by its very nature––is a very uneven process. Herein lie the important policy implications of the volume.

Introduction; Chapter 1 German Economics as Development Economics: From the Thirty Years’ War to World War II; Chapter 2 The Role of the State in Economic Growth; Chapter 3 A Brief Introduction to Veit Ludwig von Seckendorff (1626– 1692); Chapter 4 Exploring the Genesis of Economic Innovations: The Religious Gestalt- Switch and the Duty to Invent as Preconditions for Economic Growth (with Arno Daastøl); Chapter 5 Johann Heinrich Gottlob von Justi (1717– 1771): The Life and Times of an Economist Adventurer; Chapter 6 Jacob Bielfeld’s “On the Decline of States” (1760) and Its Relevance for Today; Chapter 7 Raw Materials in the History of Economic Policy; or, Why List (the Protectionist) and Cobden (the Free Trader) Both Agreed on Free Trade in Corn; Chapter 8 Compensation Mechanisms and Targeted Economic Growth: Lessons from the History of Economic Policy; Chapter 9 Karl Bücher and the Geographical Dimensions of Techno- Economic Change: Production- Based Economic Theory and the Stages of Economic Development; Chapter 10 Austrian Economics and the Other Canon: The Austrians between the Activistic- Idealistic and the Passivistic- Materialistic Traditions of Economics; Chapter 11 Nietzsche and the German Historical School of Economics (with Sophus A. Reinert); Chapter 12 Creative Destruction in Economics: Nietzsche, Sombart, Schumpeter (with Hugo Reinert); Chapter 13 Schumpeter in the Context of Two Canons of Economic Thought; Chapter 14 The Role of Technology in the Creation of Rich and Poor Nations: Underdevelopment in a Schumpeterian System; Chapter 15 Towards an Austro–German Theory of Uneven Economic Development? A Plea for Theorising by Inclusion; Chapter 16 The Qualitative Shift in European Integration: Towards Permanent Wage Pressures and a ‘Latin- Americanization’ of Europe? (with Rainer Kattel); Chapter 17 Primitivization of the EU Periphery: The Loss of Relevant Knowledge; Chapter 18 Mechanisms of Financial Crises in Growth and Collapse: Hammurabi, Schumpeter, Perez, and Minsky; Chapter 19 Full Circle: Economics from Scholasticism through Innovation and Back into Mathematical Scholasticism: Reflections on a 1769 Price Essay: “Why Is It That Economics So Far Has Gained So Few Advantages from Physics and Mathematics?”; Chapter 20 Werner Sombart (1863–1941) and the Swan Song of German Economics; Index.

Sujets

• Research and development
• Theory
• Economics

Informations

• Publié par: Anthem Press
• Date de parution: 15 février 2019
• Nombre de lectures: 1
• EAN13: 9781783089055
• Langue: English

Extrait

The Visionary Realism of German Economics
ANTHEM OTHER CANON ECONOMICS
The Anthem Other Canon Economics series is a collaboration between Anthem Press and The Other Canon Foundation. The Other Canon – also described as ‘reality economics’ – studies the economy as a real object rather than as the behaviour of a model economy based on core axioms, assumptions and techniques. The series includes both classical and contemporary works in this tradition, spanning evolutionary, institutional and Post-Keynesian economics, the history of economic thought and economic policy, economic sociology and technology governance, and works on the theory of uneven development and in the tradition of the German historical school.
SERIES EDITORS
Erik S. Reinert – Chairman, The Other Canon Foundation, Norway and Tallinn University of Technology, Estonia
Rainer Kattel – University College London, UK and Tallinn University of Technology, Estonia
Wolfgang Drechsler – Tallinn University of Technology, Estonia and Davis Center, Harvard University, USA
EDITORIAL BOARD
Ha-Joon Chang – University of Cambridge, UK
Mario Cimoli – UN-ECLAC, Chile
Jayati Ghosh – Jawaharlal Nehru University, India
Steven Kaplan – Cornell University, USA
Jan Kregel – Levy Economics Institute of Bard College, USA and Tallinn University of Technology, Estonia
Bengt-Åke Lundvall – Aalborg University, Denmark
Keith Nurse – University of the West Indies, Barbados
Patrick O’Brien – London School of Economics and Political Science (LSE), UK
Carlota Perez – London School of Economics and Political Science (LSE), UK; University College London, UK; SPRU – University of Sussex, UK and Tallinn University of Technology, Estonia
Alessandro Roncaglia – La Sapienza University of Rome, Italy
Jomo Kwame Sundaram – Institute of Strategic and International Studies, Malaysia
The Visionary Realism of German Economics: From the Thirty Years’ War to the Cold War
Erik S. Reinert
Edited by Rainer Kattel
Anthem Press
An imprint of Wimbledon Publishing Company
www.anthempress.com
This edition first published in UK and USA 2019
by ANTHEM PRESS
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or PO Box 9779, London SW19 7ZG, UK
and
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© 2019 Rainer Kattel editorial matter and selection;
individual chapters © individual contributors
The moral right of the authors has been asserted.
All rights reserved. Without limiting the rights under copyright reserved above,
no part of this publication may be reproduced, stored or introduced into
a retrieval system, or transmitted, in any form or by any means
(electronic, mechanical, photocopying, recording or otherwise),
without the prior written permission of both the copyright
owner and the above publisher of this book.
British Library Cataloguing-in-Publication Data
A catalogue record for this book is available from the British Library.
ISBN-13: 978-1-78308-903-1 (Hbk)
ISBN-10: 1-78308-903-2 (Hbk)
This title is also available as an e-book.
Contents

Introduction
Chapter 1
German Economics as Development Economics: From the Thirty Years’ War to World War II
Chapter 2
The Role of the State in Economic Growth
Chapter 3
A Brief Introduction to Veit Ludwig von Seckendorff (1626–1692)
Chapter 4
Exploring the Genesis of Economic Innovations: The Religious Gestalt-Switch and the Duty to Invent as Preconditions for Economic Growth (with Arno Daastøl)
Chapter 5
Johann Heinrich Gottlob von Justi (1717–1771): The Life and Times of an Economist Adventurer
Chapter 6
Jacob Bielfeld’s “On the Decline of States” (1760) and Its Relevance for Today
Chapter 7
Raw Materials in the History of Economic Policy; or, Why List (the Protectionist) and Cobden (the Free Trader) Both Agreed on Free Trade in Corn
Chapter 8
Compensation Mechanisms and Targeted Economic Growth: Lessons from the History of Economic Policy
Chapter 9
Karl Bücher and the Geographical Dimensions of Techno-Economic Change: Production-Based Economic Theory and the Stages of Economic Development
Chapter 10
Austrian Economics and the Other Canon: The Austrians between the Activistic-Idealistic and the Passivistic-Materialistic Traditions of Economics
Chapter 11
Nietzsche and the German Historical School of Economics (with Sophus A. Reinert)
Chapter 12
Creative Destruction in Economics: Nietzsche, Sombart, Schumpeter (with Hugo Reinert)
Chapter 13
Schumpeter in the Context of Two Canons of Economic Thought
Chapter 14
The Role of Technology in the Creation of Rich and Poor Nations: Underdevelopment in a Schumpeterian System
Chapter 15
Towards an Austro–German Theory of Uneven Economic Development? A Plea for Theorising by Inclusion
Chapter 16
The Qualitative Shift in European Integration: Towards Permanent Wage Pressures and a ‘Latin-Americanization’ of Europe? (with Rainer Kattel)
Chapter 17
Primitivization of the EU Periphery: The Loss of Relevant Knowledge
Chapter 18
Mechanisms of Financial Crises in Growth and Collapse: Hammurabi, Schumpeter, Perez, and Minsky
Chapter 19
Full Circle: Economics from Scholasticism through Innovation and Back into Mathematical Scholasticism: Reflections on a 1769 Price Essay: “Why Is It That Economics So Far Has Gained So Few Advantages from Physics and Mathematics?”
Chapter 20
Werner Sombart (1863–1941) and the Swan Song of German Economics

Index
Introduction
Erik S. Reinert
This volume attempts to present a period of around three hundred years of the German-language tradition in economic theory. The German tradition originated as part of a larger Continental tradition in economics, the origin of which can be seen as the massive impact of Italian economist Giovanni Botero’s 1588 bestselling On the Greatnesse of Cities 1 —soon incorporated into a larger work on the Reason of State —which appeared in about 45 editions in Italian, Latin, Spanish, French and German between 1588 and 1666. Reflecting the cosmopolitical nature of Jesuit activism, Botero’s connection to Germany and Mitteleuropa was strong. His first four publications appeared, respectively, in Krakow, Würzburg, Nürnberg and Frankfurt. 2 Before the Thirty Years’ War—which marks the starting point for the present volume—there were already four Latin editions of Botero’s Greatnesse of Cities published in Germany. 3
The broad and cross-disciplinary social science tradition started by Botero came to dominate economics in Germany more and longer than in other nations. We can find partial explanations for this in the fact that Germany—compared to countries like Holland, England or France—was a relative latecomer: eine verspätete Nation . Until the end of the nineteenth century, Germany also consisted of many states—several hundred states after the Thirty Years’ War (1648) and still around 30 three centuries later. We can speculate if the diversity and large number of small competing states with small populations may have encouraged researchers to be cross-disciplinary. To paraphrase Adam Smith, the small size of the partly regional markets for social sciences may have limited the division of labor. This may also have reinforced a cultural tendency to attempt to understand large and complex structures in a holistic way: the desire for a Ganzheitslehre . 4
German philosopher Johann Gottlieb Fichte (1762–1814) certainly thought German political diversity, rather than unity, would cause increased learning and emulation: 5

How fortunate we are in this regard that there are still so many distinct and separate German states! What is so often said to be to our disadvantage can perhaps work to our advantage in this important national matter. Perhaps imitation on the part of the majority, and the desire to get ahead of the others, will bring about something that the tranquil self-satisfaction of the individual states would not; for it is plain that the one state among all German states that makes a start with this will gain a definite lead in the respect, love, and gratitude of all; it will be the supreme benefactor and true founder of the nation. It will give the others courage, provide an instructive example, and become their model. 6
Until its swan song as a result of World War II, German economics followed Botero’s approach of blending economics, in its narrow sense, not only with what is now called sociology but also with anthropology, political science, demography, and facts and figures from any other field that seemed to be relevant for the questions at hand. Relevance, as opposed to available tools, was the starting point for any analysis in this tradition. Botero’s second major work, Relazioni Universali , 7 is organized more by geography and ethnicity than by nation-states proper. As one observer says, Botero “brought together an immense mass of geographical and anthropological information, which he tried to organize according to broad methodological categories (like ‘resources’, ‘government’, and ‘religion’).” 8 During the 200 years following the first 1591 Italian edition, Botero’s Relazioni Universali was published in an incredible 84 editions 9 —in Italian, German, Latin, English, Spanish and Polish. 10
The first six chapters of this book trace the German tradition as it was methodologically part of mainstream Continental European economics. Already early on, in the seventeenth century, English economics, so-called mercantilism, sta