Fritz Machlup: Review of Die verschiedenen Vorstellungsinhalte des Begriffes Kapital (1935)

Fritz Machlup’s short book review evaluates Werner Brylewski’s study of the meanings attached to “capital.” Its central distinction is between cataloguing definitions and assessing their explanatory usefulness. Machlup acknowledges the diversity Brylewski documents, but argues that a history and classification of concepts cannot resolve theoretical confusion unless it examines what those concepts enable economists to explain.

The review begins by recalling Böhm-Bawerk’s diagnosis, fifty years earlier, of a “Babylonic confusion of tongues” in capital theory. Brylewski’s monograph responds to this continuing problem through historical investigation and the analysis of hundreds of definitions. Machlup describes its reach back to Aristotle, Columella, and Augustine, alongside its attention to the Latin word capitale. Yet he finds its engagement with modern economics deficient: Åkerman, Hayek, Keynes, Knight, and Strigl are among the writers it neglects. The deeper objection concerns the separation of definitions from their theoretical functions:

But he does not inquire for what explanatory purposes the definitions were employed.

For Machlup, discussing the material and methodological premises of a definition is insufficient without examining its use within particular theories. His account of Brylewski’s classification nevertheless makes clear what the book accomplishes. Definitions emphasize either capital’s origin—as a product, accumulated labor, stock, or saved productive power—its use—as workers’ subsistence, a productive instrument, or a means of making money—or its outward appearance, including money, property, material things, value, and purchasing power.

Machlup accepts these distinctions as accurate, then questions their analytical payoff. His concluding sentence supplies the criterion missing from the inventory:

There is no point in reflecting upon conceptions, their content, and their definition, if no attempt is made to prove their adequacy for special hypotheses, their usefulness for the description and interpretation of given phenomena.

The review thus moves from historical coverage to classification and finally to methodological judgment. Its relevance lies in the demand that conceptual analysis connect definitions to hypotheses and phenomena. Machlup offers no preferred definition of capital here; instead, he insists that the usefulness of any definition must be assessed through the explanatory work it performs.