Hans Bayer, Wirtschaftsordnung und Persönlichkeit (1948)

Hans Bayer’s journal article examines economic organization as a condition for the development of human personality. An editorial introduction identifies it as the second article in a discussion begun with the individual’s relationship to society. Its three sections move from alternative ways of implementing an economic order, through the rejection of universal policy “recipes,” to a synthesis of economic planning and personal development. Bayer’s central claim is that planning must secure the material conditions of individual flourishing without treating centralized administration or comprehensive nationalization as ends in themselves.

His first conceptual move separates an organizing principle from its institutional implementation:

Das Ordnungsprinzip der Planwirtschaft ist dadurch charakterisiert, daß eben, wie schon der Name sagt, ein Wirtschaftsplan besteht, nicht aber durch die Art der Durchführung dieses Planes.

English translation: The organizing principle of a planned economy is characterized by the existence of an economic plan, as the name itself indicates, but not by the manner in which that plan is implemented.

A coercive administrative economy that eliminates market mechanisms is therefore only one possible form of planning. This distinction opens the space for Bayer’s argument: the necessity of a plan does not establish the necessity of any particular bureaucratic apparatus. Institutions must instead be assessed by their contribution to the economy’s substantive purpose.

Bayer develops this position through criticism of neoliberalism, particularly Hayek’s defense of competitive economic organization. In Bayer’s account, free exchange generates increasing concentrations of economic power and does not guarantee an income distribution adequate to the economy’s proper goal. Yet his objection is not simply that large enterprises should be dissolved. Cartels and corporate combinations may have produced productivity gains unavailable without them. Preserving competition by dismantling such organizations could consequently undermine production. The problem is how economic power is used, not merely whether large organizations exist.

Röpke’s proposed “third way” receives a related criticism. His principle of adjustment intervention asks the state to assist economic change rather than resist it—for example, by facilitating the abandonment of unprofitable wine production. But Bayer argues that Röpke’s further demands, including decentralizing large cities, providing workers’ homes, and supporting smaller enterprises, cannot be achieved through adjustment intervention alone. The contradiction lies between a restricted account of legitimate state action and structural ambitions requiring more extensive intervention.

Against these approaches, Bayer makes the economic goal, concrete circumstances, and economy of means the governing criteria of planning. A smaller administrative apparatus is preferable whenever it achieves the same result. Freedom is thus an operational requirement within planning, not simply its opposite:

Überall dort also, wo der einzelne oder Vereinigungen dasselbe oder Besseres erreichen als große staatliche Einrichtungen, ist dem einzelnen oder den kleineren Verbänden soviel Freiheit zu belassen, als es die Durchführung des Planes erlaubt.

English translation: Thus, wherever the individual or associations achieve the same or better results than large state institutions, the individual or the smaller associations should be left as much freedom as implementation of the plan permits.

This freedom remains conditional on the plan’s execution, but it establishes a presumption against unnecessary centralization. Planning should mobilize individual and associative capacities rather than automatically replace them with state agencies.

The second section rejects authoritative blueprints. Bayer reads the papal encyclicals Rerum Novarum and Quadragesimo anno as establishing moral boundaries rather than detailed economic instructions. They reject liberalism, prevailing concentrations of economic power, and complete nationalization; economic theory and policy must determine workable arrangements within those boundaries. Socialism likewise supplies no finished institutional recipe. Bayer links renewed attention to institutional design to the recognition that economic and social development follows social regularities rather than natural laws.

Oskar Lange’s competitive socialism supplies an important example of this flexibility:

Darnach sollte Privateigentum an Produktionsmitteln den vollen Schutz und die volle Förderung des sozialistischen Staates erfahren, soweit es eine sozial nützliche Funktion ausübt.

English translation: According to this view, private ownership of the means of production should receive the full protection and full support of the socialist state insofar as it performs a socially useful function.

The qualification is decisive: ownership is judged by its social function. Socialization should extend only far enough to prevent productive resources from becoming instruments of monopoly power against the public. Bayer accordingly envisages socialized, free, and cooperative sectors. Cooperatives are especially important because their self-government can avert the excessive bureaucracy that he regards as a major danger to successful planning.

The concluding section identifies the purpose organizing these institutional choices:

Wir gingen in unseren Untersuchungen von dem aus dem wirtschaftlichen Grundatbestand erkennbaren Wirtschaftsziel aus und nahmen als dessen Konkretisierung die Forderung an, daß die Wirtschaft die materiellen Grundlagen für die Entfaltung der menschlichen Persönlichkeit zu gewährleisten habe.

English translation: In our investigations, we proceeded from the economic goal discernible from the fundamental economic situation and took as its concrete expression the requirement that the economy must guarantee the material foundations for the unfolding of human personality.

Economic organization must make possible the development of each person’s capacities and the fulfillment of their tasks. Bayer nevertheless distinguishes enabling conditions from their realization: even excellent institutions cannot ensure personal development without the individual’s inward commitment to cultivating intellectual and physical abilities. His closing appeal to Goetz Briefs reinforces the need to create objective opportunities for a changed disposition to become effective. The article’s relevance lies in this conjunction of material provision and personal agency. It advocates planning while resisting its identification with total state ownership, and evaluates competition, property, and cooperative self-government by their contribution to human development.