Friedrich August von Hayek · 1978
J. R. Hicks and Wilhelm Weber’s edited volume uses the centenary of Carl Menger’s Grundsätze to reassess both Menger’s 1871 book and the Austrian tradition that developed from it. The chapters treat Menger historically, comparatively, and theoretically: as a critic of classical value theory, as one of the marginal revolution’s principal figures alongside Jevons and Walras, as a defender of abstract theory against historicism, and as the starting point for later Austrian work on value, money, capital, and market process.
Hayek’s chapter, “The Place of Menger’s Grundsätze in the History of Economic Thought,” supplies the volume’s broad historical frame. He emphasizes that Menger did not appear after a long intellectual vacuum but at a moment when classical economics still dominated despite many partial advances.
When the Grundsätze appeared in 1871, it was only 95 years since the Wealth of Nations, only 54 since Ricardo’s Principles, and a mere 23 since the great restatement of classical economics by John Stuart Mill.
This chronology shapes the whole collection’s problem. The contributors are less interested in celebrating a sudden “discovery” of marginal utility than in explaining why Menger’s version mattered: it offered a general causal account of value, exchange, and higher-order goods where earlier insights into demand and price had remained scattered.
Though many of them contained much shrewd analysis of the factors that contributed to the determination of price in particular situations, they all lacked a general theory under which the particular instances could be subsumed.
Other chapters extend that problem into method and reception. Menger’s work is presented as a response not only to Ricardian cost theory but also to the German historical school’s suspicion of abstract economic law. The volume therefore treats the Methodenstreit as central rather than incidental: Austrian economics emerges as a defense of theory capable of explaining market coordination without reducing economics to either historical description or mechanical formalism.
There was further the growing influence of the historical school which tended to question the value of all attempts at a general theory of economic phenomena.
Across the volume, Menger’s subjectivism becomes the connecting thread. The chapters follow its implications for marginal valuation, imputation, opportunity cost, money as an emergent institution, and the later Austrian emphasis on time, knowledge, and market adjustment. The contributors also distinguish Menger from Jevons and Walras: the point is not simply that all three used marginal reasoning, but that Menger embedded valuation in a causal account of goods, wants, scarcity, and human action.
Their scientific work seems to me to have sprung entirely from their awareness of the inadequateness of the prevailing body of theory in explaining how the market order in fact operated.
The volume’s cumulative argument is that the Austrian school is best understood as a continuing research program rather than a closed doctrine. Hicks and Weber’s contributors show how Menger’s Grundsätze opened questions about subjective value, institutions, equilibrium, and process that later Austrians developed in different directions. Its scholarly force lies in making Menger central to modern economics while preserving what made his approach distinctive: causal explanation, individual valuation, and attention to the market order as an intelligible but evolving social process.
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