Eugen von Böhm-Bawerk: Review of John Rae’s The Sociological Theory of Capital (1906)

Böhm-Bawerk’s short scholarly review welcomes Charles Whitney Mixter’s 1905 republication of John Rae’s 1834 work as the recovery of an original contribution to capital theory. Moving from intellectual appraisal through an account of neglect to an assessment of Mixter’s editorial intervention, the review argues that Rae’s theoretical importance had been obscured by both his book’s presentation and its subsequent scarcity.

The original title foregrounded criticism of free trade and Adam Smith, but Böhm-Bawerk locates the work’s substance elsewhere: those polemical concerns merely frame an independent theory of capital. Its distinction lies in pursuing capital’s foundations across several domains:

Mit einem bemerkenswerten Bedürfnis nach Vertiefung sucht Rae die Probleme des Kapitales bis in ihre letzten Wurzeln auf produktionstechnischem, psychologischem und soziologischem Gebiet zu verfolgen.

English translation: With a remarkable need for depth, Rae seeks to pursue the problems of capital down to their ultimate roots in the technical-productive, psychological, and sociological domains.

Böhm-Bawerk places Rae alongside von Thünen and identifies affinities with ideas later appearing in Jevons and in his own work. This establishes Rae’s historical relevance without claiming a direct line of influence. The emphasis falls instead on neglected discoveries subsequently reached by others under more favorable conditions of reception.

The explanation of Rae’s failure combines a possible mismatch between title and readership with a firmer criticism of his exposition:

Er nähert sich den Problemen auf einem höchst originellen Wege und präsentiert sie auch seinen Lesern unter einer sehr ungewöhnlichen, an das Bizarre streifenden Vorstellungs- und Ausdrucksweise.

English translation: He approaches the problems by a most original route and presents them to his readers as well in a very unusual mode of conception and expression, bordering on the bizarre.

Originality thus appears as both an intellectual strength and an obstacle to communication. Readers attracted by the title may have found little of what they expected, while those interested in capital theory had little reason to seek it there. Comparing the book’s later obscurity to Gossen’s, Böhm-Bawerk acknowledges that he himself had not seen it when preparing the first edition of his history of interest theories. He credits Mixter’s 1897 article with bringing Rae back to scholarly attention.

Mixter’s republication receives praise for restoring access while removing impediments to reception. Its new title makes the theoretical subject more visible; its rearrangement places the capital-theory sections together at the beginning and transfers the remaining material to an appendix. Böhm-Bawerk stresses fidelity to the text and notes that a “Readers Guide” allows the original sequence to be recovered. Editorial mediation becomes a means of making a neglected argument legible to contemporary readers.

The review closes by explicitly limiting its substantive appraisal:

Eine genauere Würdigung dessen, was Raes nunmehr wieder zugänglich gewordenes Werk inhaltlich für die Theorie des Kapitales bedeutet hat und was es etwa heute noch bedeutet, läßt sich nicht mit knappen, in den Rahmen einer kurzen Anzeige fallenden Worten bieten.

English translation: A more exact appreciation of what Rae's work, now become accessible again, has signified in its content for the theory of capital, and of what it perhaps still signifies today, cannot be offered in the brief words that fall within the compass of a short notice.

Böhm-Bawerk directs readers to his extended treatment of Rae in the 1900 second edition of his history of interest theories. The notice’s contribution is therefore a precise act of historical reassessment and recommendation: it identifies Rae’s conceptual reach, explains his delayed recognition, and endorses the editorial work that makes renewed engagement possible.