Friedrich A. Hayek, “Bemerkungen zur vorstehenden Erwiderung Prof. Emil Lederers” (1930)

Hayek’s reply to Emil Lederer is a compressed defense of his earlier charge that Lederer’s crisis theory belongs near the underconsumptionist argument of Foster and Catchings. Its main thesis is that, whatever Lederer now disavows, his published theory explains crises as the result of saving-led accumulation outstripping consumer purchasing power, and his policy remarks therefore incline toward the same “Konsumfinanzierung” Hayek had criticized.

die gleichen Einwände, die ich gegen die Ansichten Fosters und Catchings' angeführt habe, ebenso auch gegen die Konjunkturtheorie und die konjunkturpolitischen Vorschläge Lederers gelten.

English translation: the same objections which I have raised against the views of Foster and Catchings apply equally to Lederer's business-cycle theory and his proposals for cyclical policy.

The article’s structure is evidentiary and critical. Hayek first answers Lederer’s accusation of superficial reading by reproducing passages from Lederer’s writings. He then argues that these passages contain the decisive proposition: general crisis is explained by a gap between output and spendable income.

Auseinanderklaffen zwischen Produktionsentwicklung und Einkommensentwicklung

English translation: a divergence between the development of production and the development of incomes

For Hayek, this is not a harmless formulation of disproportionality but an erroneous monetary-consumption theory of crisis. Lederer’s claim that accumulation can proceed “too fast” means, in Hayek’s reading, that the value-relation between consumption goods and capital goods must be kept constant if crisis is to be avoided.

Die Akkumulation muß also unter diesen Umständen ‚zu schnell‘ vor sich gehen

English translation: Accumulation must therefore, under these circumstances, proceed 'too quickly'.

Hayek identifies this as the “Grundirrtum”: the idea that a rising share of saving necessarily makes the consumer-goods market unable to realize profits. Lederer’s own hypothetical case—people satisfying only subsistence needs and saving the rest—confirms for Hayek that the argument is not merely about a physical absence of consumption, but about a supposedly inadequate monetary demand for consumption goods.

Allgemeine, dauernde Einschränkung des Konsums würde den oben gekennzeichneten Effekt haben

English translation: A general, lasting restriction of consumption would have the effect characterized above.

Against this, Hayek restates the Austrian-capital-theoretic point of his earlier article. Crisis does not follow because consumers spend too little; it follows when the structure of production has been drawn into paths no longer justified by the actual relation between demands for capital goods and consumption goods. The crucial inversion is passage-driven and sharp: an over-supply of production goods arises

nicht weil die Nachfrage nach Konsumgütern zu klein, sondern im Gegenteil, weil sie zu groß und dringend ist

English translation: not because the demand for consumer goods is too small, but on the contrary because it is too great and too urgent

This is the conceptual center of the piece. Hayek denies that a minimum volume of consumer purchasing power is required to “buy back” output at profitable prices. Any money stream can sustain a structure if relative demands correspond to the production structure. The crisis problem is not aggregate insufficiency but a mismatch between the supply of intermediate/capital goods and the demand pattern that would make them profitable.

Hayek then turns from theory to policy. He explains why he had attributed only “Sympathien” to Lederer rather than full agreement with Foster and Catchings: Lederer hesitated before their inflationary conclusions. Yet Hayek cites Lederer’s own discussions of consumer credit, public works, and employment policy to show that the practical impulse remains the same. Lederer had written that in hardened crises

nur Forcierung des Konsums, selbst um den Preis von Gewinnlosigkeit, ja von Verlusten, die Krise überwinden kann

English translation: only a forcing of consumption—even at the price of an absence of profits, indeed of losses—can overcome the crisis

Hayek reads such sentences as evidence that Lederer’s anti-crisis policy tends toward credit-created purchasing power. He also objects that Lederer confuses Hayek’s rejection of credit-financed emergency works with a rejection of all cycle policy. Hayek’s position is preventive rather than curative: once a distorted boom has produced malinvestments, “Wunderkuren” cannot remove the damage. Stabilization must occur by restraining the upswing.

nur von einer Bremsung des Aufstieges erwartet

English translation: expected only from a braking of the upswing

The final conceptual move is Hayek’s definition of genuine disproportionality. It is not that the capital stock becomes too large in relation to current consumption as such; capital may be many times greater in value than current consumer-goods output. Disproportionality exists only when

das Verhältnis des Kapitalgüterangebotes zum Konsumgüterangebot größer ist als das Verhältnis von Kapitalgüternachfrage zur Konsumgüternachfrage

English translation: the ratio of the supply of capital goods to the supply of consumer goods is greater than the ratio of the demand for capital goods to the demand for consumer goods

The relevance of the piece lies in this early and pointed formulation of Hayek’s anti-underconsumptionism. It shows him resisting the view that crises are cured by increasing consumption, and insisting instead on relative-demand coordination across the temporal structure of production. Its closing irony is that Lederer takes the collapse of production-goods industries as proof of deficient consumer purchasing power; Hayek treats this as precisely the misunderstanding his capital theory was meant to expose.