Joseph Alois Schumpeter, “Rudolph Auspitz” (1906)

This short obituary is a scholarly and political memorial, not a systematic treatise. Schumpeter’s scope is compact: he presents Rudolph Auspitz as a figure whose importance lay in the unusual combination of parliamentary influence, industrial experience, ethical liberalism, and first-rate mathematical economics. The central thesis is that Auspitz deserves remembrance both as a public man who subordinated private and class advantage to public welfare, and as a theorist whose joint work with Richard Lieben was among the strongest achievements of mathematical economics.

RUDOLPH AUSPITZ, who died at Vienna on March the 8th, was a very interesting personality, both in politics and in science.

Schumpeter first sketches Auspitz’s formation: technical schooling in Vienna, scientific study in Berlin and Paris, and later practical engagement as founder of a Moravian sugar manufactory. This background matters for the argument because it explains the two sides of Auspitz’s authority: he knew business from within, but approached economic theory with mathematical and scientific discipline. His parliamentary career in the Moravian Landtag and the Reichsrat is treated not as incidental biography but as evidence of applied economic judgment. Schumpeter emphasizes his influence especially in taxation, including sugar taxation and the 1896 reform of direct taxation.

The obituary’s moral center is Auspitz’s independence from self-interest. As a sugar producer he might have profited politically from protectionism, yet Schumpeter stresses that he remained a consistent free trader. The point is not merely doctrinal liberalism, but a liberalism disciplined by public spirit and social sympathy.

It is, generally, a characteristic point, which deserves to be noted, that during his whole political life he was not only completely free from any personal aspiration, but also from class interest.

This claim organizes the political portrait. Auspitz supported progressive income taxation, opposed indirect taxation, and refused membership in the sugar cartel. Schumpeter’s most vivid example is the private disposal of cartel-derived surplus: because market prices were effectively shaped by the trust, Auspitz could not avoid extraordinary profit, but he redirected it to a pension fund for clerks in the sugar industry. The anecdote is presented as especially revealing because it was not publicized during his life.

The second half of the notice turns from politics to theory. Schumpeter locates Auspitz within the mathematical school and treats the 1889 Untersuchungen über die Theorie des Preises, written with Richard Lieben, as the major intellectual monument. He notes that German reception was limited because historical and practical schools dominated economic discussion, while foreign readers, especially in England, were more receptive.

It is undoubtedly one of the ablest works of the mathematical school of Economists.

Schumpeter’s conceptual account is brief but precise. Auspitz and Lieben used a distinctive coordinate system, examined the assumptions required for geometrical representation, and applied it to price theory. They accepted the modern theory of value and belonged broadly with the Austrian economists, while differing from Menger’s formulation. Schumpeter presents Auspitz’s position as close to Marshall and Edgeworth: marginal value theory completes and corrects Ricardo rather than abolishing him.

He held that the modern theory of value is a completion and partial correction, but not a destruction, of Ricardo’s views.

From this follows the work’s core analytical move: production and consumption are treated symmetrically. Price is determined at the margin on both sides—by the utility of the last unit bought and the cost of the last unit produced. This gives the theory its graphical and welfare-theoretic power, leading to consumer’s rent, producer’s rent, and the “gain of the community.”

From this standpoint follows the fundamental parallelism between production and consumption, the symmetry between supply and demand.

Schumpeter closes by distinguishing, cautiously, the collaborators’ contributions: Auspitz is associated chiefly with analytical treatment, Lieben with the system of curves. The final judgment is both memorial and corrective: Auspitz’s book had not yet received the attention it deserved. The obituary therefore functions as an act of intellectual recovery, placing Auspitz among those economists whose mathematical formalism served not abstraction for its own sake, but a clearer account of value, price, welfare, and public policy.