Eugen Peter Schwiedland: Review of Jean Lescure’s Des crises générales et périodiques de surproduction, second edition (1911)

Eugen Peter Schwiedland’s 1911 German review examines the second edition of Lescure’s study, published in 1910. It follows the book from the history of crises through their causal explanation to proposed remedies, valuing its empirical grounding while distinguishing feasible reforms from questionable interventions.

The historical discussion treats crises between 1810 and 1909 as general phenomena of overproduction. Schwiedland draws attention to their fiscal consequences: prosperity encourages premature increases in public expenditure, while depression reduces tax receipts. Industrial development depends on savings successively committed to textiles, railways, and electrical industries. Mining and pig-iron output, alongside trade, transport, and monetary statistics, provide indicators of the general business situation. The connection between deteriorating conditions and capital withdrawal is central:

Sobald dieser sich ernsthaft verschlechtere, ziehen sich die Kapitalien der Sparer von der Anlage in Unternehmungen zurück; andererseits führen die Krisen zu energischen Versuchen, die Gestehungskosten zu vermindern.

English translation: As soon as this deteriorates seriously, the capital of savers withdraws from investment in enterprises; on the other hand, the crises lead to vigorous attempts to reduce the costs of production.

Crisis thus entails both interrupted investment and pressure to reduce production costs. The theoretical discussion links productive capacity outstripping demand to an unfavorable movement of costs relative to selling prices and interest. Schwiedland summarizes Lescure’s causal conclusion:

Somit liege die letzte Ursache der Krisen in der Verringerung des Unternehmergewinnes, wodurch das Kapital von weiteren Immobilisierungen in Unternehmungen abgehalten werde.

English translation: Thus the ultimate cause of crises lies in the diminution of entrepreneurial profit, by which capital is deterred from further immobilization in enterprises.

The explanation turns on declining entrepreneurial profit and the consequent reluctance to commit capital to enterprises. Overproduction is thereby connected to investment incentives, not merely to an excess quantity of goods.

The remedies range from improved production and consumption statistics to banking and industrial measures. Better information could restrain speculation; Schwiedland connects this proposal with Franz Klein’s earlier advocacy of regular official business reports. Banking proposals include foreign-security reserves, a gold-premium policy, and expanded note issuance. Industrial concentration might moderate fluctuations through coordinated pricing, but the American steel combination illustrates the uncertainty of this mechanism: reserves supported improvements and price reductions in 1904, whereas later price rigidity impeded adjustment.

Proposals for workers include cooperative unemployment funds, shorter working hours, and employer funds. State action could cover old-age insurance contributions during crises and compel reductions in working time. Schwiedland regards the final proposals as especially doubtful and considers a public statistical service more attainable. His favorable overall assessment rests chiefly on Lescure’s procedure: deriving theoretical claims from particular crises and examining competing explanations against historical experience. The review therefore endorses the study’s empirical method without extending that endorsement indiscriminately to its remedies.