Menger’s essay is formally a review of the second, enlarged edition of Gustav Schönberg’s collective Handbuch der politischen Oekonomie, but it functions as a compact methodological intervention in the Methodenstreit. He begins by acknowledging the handbook’s importance for German readers and the real merits of its collaborative design: specialists treat agriculture, finance, administration, trade, population, money, credit, transport, and social policy with empirical learning and practical competence. Yet the very breadth of the work also exposes, for Menger, the unresolved disorder of German economics as a science.
Die Behandlung, welche gerade einzelne Hauptprobleme der politischen Oekonomie bei Schönberg finden, ist allerdings eine anfechtbare.
English translation: The treatment which precisely certain principal problems of political economy receive in Schönberg is, however, open to challenge.
The review is therefore both appreciative and diagnostic. Menger praises the historical, legislative, and descriptive strength of many contributions, especially where the authors command concrete institutions and policy questions. But he repeatedly objects that major theoretical problems are handled without a clear hierarchy of concepts. Schönberg’s essays on economic stages, industry, and the labor question show wide knowledge, yet their foundations remain vulnerable; Neumann’s treatments of basic concepts and price become for Menger examples of over-definition, juridical digression, and insufficient analytical discipline.
Auch die im Handbuche festgehaltene Anschauung vom Wesen der Wirthschaft überhaupt, und der Volkswirthschaft insbesondere, scheint mir eine mangelhafte zu sein.
English translation: The conception of the essence of the economy in general, and of the national economy in particular, as maintained in the Handbook, likewise seems to me to be deficient.
The central issue is the meaning of economic “laws.” Menger argues that the historical school rightly emphasizes empirical regularities, mass phenomena, and historically variable forms, but mistakes this partial truth for the whole of theory. Economic science must indeed study observed prices, institutions, customs, and statistical patterns; however, it must also investigate the rational relations implied in economizing action. Real economies are mixtures of calculation, error, coercion, altruism, law, and habit. Exact theory does not pretend to reproduce this mixture photographically; it isolates the inner logic of economizing so that deviations in reality can be understood rather than merely recorded.
Das Wesen der „Gesetze“ der Volkswirthschaft scheint mir Schönberg nur nach einer Seite hin richtig zu kennzeichnen.
English translation: Schönberg, it seems to me, characterises the essence of the "laws" of the national economy correctly only from one side.
This distinction leads Menger to a broader classification of the economic sciences. He insists that disciplines are divided not only by their object—economy, state, law, society—but also by the formal character of the knowledge they seek. Historical knowledge, theoretical knowledge, and practical knowledge answer different questions. Political economy remains confused when economic history, statistics, pure theory, and policy are fused into a single “science of the national economy” and then defended as though their mixture were methodological depth.
Nun erweist sich eine solche Universalwissenschaft von der Volkswirthschaft nicht nur vom methodologischen Standpunkte als ein schwerer Missgriff, sondern, bei näherer Betrachtung, zugleich als eine Unmöglichkeit.
English translation: Now such a universal science of the national economy proves to be, not only from the methodological standpoint, a grave blunder, but, on closer examination, at the same time an impossibility.
Menger’s criticism is not anti-historical. On the contrary, the review repeatedly values empirical research, institutional detail, and administrative experience. His target is the claim that such inquiry can replace exact theory, or that policy can be organized without independent theoretical principles. Economic history and statistics are indispensable, but they are not identical with theoretical economics; economic policy presupposes theory, but it is not theory. The handbook’s categories of “general” and “special” economics do not solve the problem, because both theory and practice have general and special branches of their own.
The essay’s constructive position is methodological pluralism with firm boundaries. Empirical theory discovers regularities in observed economic life; exact theory reconstructs the necessary relations of economizing under simplified assumptions. Each has legitimacy, and each becomes misleading when it claims the whole field.
Die Wahrheit liegt offenbar in der Mitte, in der Anerkennung der Eigenart und Bedeutung beider Richtungen theoretischer Forschung.
English translation: The truth evidently lies in the middle, in the recognition of the distinctive character and importance of both directions of theoretical research.
Thus Menger turns a book review into a program for reforming political economy. Schönberg’s Handbuch exemplifies the strengths of German scholarship—historical breadth, practical seriousness, and institutional knowledge—but also its weaknesses: eclectic arrangement, theoretical hesitation, and suspicion of abstraction. Menger’s final implication is that the future of economics depends on restoring the autonomy of exact theory while preserving disciplined empirical inquiry.
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