Eugen von Böhm-Bawerk’s Review of Georg Sulzer (1895)

Eugen von Böhm-Bawerk’s 1895 review of Georg Sulzer’s Die wirtschaftlichen Grundgesetze in der Gegenwartsphase ihrer Entwicklung, published in the Zeitschrift für Volkswirtschaft, Sozialpolitik und Verwaltung, evaluates a systematic reconstruction of economics through marginal utility and intertemporal valuation. Admiration for Sulzer’s intellectual discipline frames criticism of his terminology and explanation of capital and interest.

Wir haben es hier zweifellos mit einem nicht gewöhnlichen Werke eines nicht gewöhnlichen Verfassers zu thun.

English translation: We have here to do, without doubt, with an uncommon work by an uncommon author.

This opening establishes the review’s generous but discriminating stance. Sulzer approaches economics through social reform, treating knowledge of the economic organism as a prerequisite for improving it. Böhm-Bawerk recognizes a mature thinker whose apparently first economic publication displays considerable analytical ambition. He identifies its theoretical affiliations explicitly:

Die wichtigsten theoretischen Grundlagen hat der Verfasser mit den jetzt häufig so genannten „Oesterreichischen Oekonomisten“ gemein.

English translation: The most important theoretical foundations the author has in common with those now frequently so called "Austrian economists".

Specifically, Sulzer accepts marginal utility and the proposition, associated with Böhm-Bawerk’s capital theory, that present goods ordinarily possess greater marginal utility and value than equivalent future goods. These principles supply the starting point for a deductive system, without guaranteeing agreement with their earlier exponents.

Für dieses sind charakteristisch seine grosse methodische Strenge und die Einheitlichkeit und Geschlossenheit des Aufbaues.

English translation: Characteristic of it are its great methodological rigour and the unity and coherence of its construction.

Böhm-Bawerk connects this coherence to an isolating, genetic method: Sulzer specifies simple economic situations before introducing successive complications. The exposition moves from consumption in an isolated economy through production to exchange and the conditions of a modern exchange economy. Its precise statement of assumptions invites comparison with Thünen.

The system’s unifying idea is economic equilibrium, understood through the equalization of marginal utility across alternative uses of scarce means. Equilibrium connects competing and complementary goods, present and future satisfactions, and the allocation of time among consumption, production, and learning. Production costs and exchange prices receive corresponding treatments, while wages, interest, differential rent, capital formation, entrepreneurial profit, advertising, and crises enter the same framework. Equilibrium denotes a tendency encountering persistent obstacles, not a claim that actual economies continuously achieve balance.

The reviewer finds this unification illuminating but occasionally forced. Familiar phenomena become difficult to recognize beneath abstract classifications: intensive cultivation and greater exertion at work, for example, appear under the spatial extension of useful services. Böhm-Bawerk treats these difficulties partly as costs of systematic ambition. His sharper objection concerns conceptual proliferation. Sulzer introduces elaborate terms for utility increments and losses while avoiding established categories such as value and capital. Two equilibrium-utility concepts appear to denote the same magnitude as marginal utility, distinguishing procedures for estimating it rather than different economic quantities.

Capital theory exposes a more substantial divergence. Shared terminology can obscure disagreement about explanatory mechanisms. Böhm-Bawerk’s subsistence fund includes unfinished intermediate products and capital goods, making savings an important constituent. Sulzer restricts the fund to goods serving present and near-future needs and contrasts it with savings. In explaining interest, Sulzer appears to emphasize psychological reasons for discounting future satisfactions; Böhm-Bawerk insists that technical conditions can independently favor present goods. He particularly objects that Sulzer’s account of falling interest rates neglects the declining additional productive return from further lengthening the production period.

The review leaves the precise extent of disagreement partly unresolved. Sulzer largely dispenses with citations and scholarly controversy in addressing educated nonspecialists, making his departures from predecessors difficult to trace. His clear exposition helps readers, but sustained abstraction remains demanding, and concrete examples sometimes arrive too late.

Böhm-Bawerk’s concluding judgment balances recurring disagreement against lasting intellectual stimulation and respect for Sulzer’s pursuit of truth. He acknowledges that his own proximity to the subject may intensify his sensitivity to defects and suspicion of innovations. The review thus combines recognition with theoretical boundary-setting: a coherent equilibrium synthesis deserves serious attention, but common marginalist premises do not settle disputes over concepts, capital, or the causes of interest.