The archive.

Why might an investor postpone an attractive project—and resume it after an election without judging its prospects any better? In this 1943 article, Shackle locates investment decisions in the individual’s changing imagination of possible futures. His concept of “potential surprise” distinguishes what a person can envisage without disbelief from what they regard as improbable, without assigning probabilities to every outcome. Attention centres on a compelling gain and loss, rather than an average return. Crucially, investors also anticipate changes in their own expectations: waiting preserves opportunities and postpones possible disappointment. This perspective gives liquidity a psychological as well as a financial rationale. Readers can trace how the timing of news, the pleasure of anticipation, and the effort of absorbing surprises may influence investment even when current project valuations offer no obvious reason for change.

A charm may shape conduct even when the observer denies it has any power, for what matters is not the physical object but the purpose someone imputes to it. On this footing Hayek defends the interpretive social sciences against the scientism he knew from within, having trained in Mach and logical positivism. The facts of economics, law, and linguistics are teleological concepts: we grasp an action by analogy with our own mind, fitting movement into patterns of purpose rather than reducing it to behavior. Social theory, he argues, is 'compositive,' assembling models of wholes like markets and states from intelligible individual conduct—and it stands logically prior to history, since no historian can bound a fact like a battle or a legal order by space and time alone.

In short, in the social sciences the things are what people think they are. Money is money, a word is a word, a cosmetic is a cosmetic, if and because somebody thinks they are.

Written in 1943 with postwar reconstruction already in view, this chapter poses a constitutional rather than merely tariff question: whether international cooperation should be built through universal institutions or through larger regional and continental federations. Haberler answers cautiously. Larger markets do permit mass production and a wider division of labour, but that gain belongs to nondiscriminatory liberalization, not to protected spheres, so he separates the complete customs union, which genuinely enlarges a market, from the incomplete preference, which merely diverts imports from cheaper outsiders to favoured insiders and hands them a windfall. Dismantling Pan-Europe, Pan-America, and Danubian schemes as geographically incoherent or coercive, he anticipates the later vocabulary of trade creation and diversion, and warns that partial blocs turn cooperation into exclusion.

To put the question the other way around: suppose that some machinery for international co-operation on a worldwide scale, like the League of Nations, is set up; should it be based on regional blocs or on independent states?

Knowing how to get across a city is not the same as knowing how to map it. In this essay, first published in 1943 and republished here in 1964, Alfred Schütz uses the native, stranger, and cartographer to distinguish practical understanding from scientific explanation. His central question is what happens when social scientists judge everyday action by standards of knowledge and consistency developed for theory. Ordinary actors rely on workable recipes; theoretical actors possess motives and information stipulated by their creators. Schütz defends such models without confusing them with living people. Readers can discover both why routine conduct need not be irrational and why a logically coherent explanation must still answer to the meanings an action has for those involved.

How can expectations enter a science of action when the future is uncertain and every observable fact admits rival readings? The answer here refuses two easy paths: against Keynes, Morgenstern, and Myrdal, Lachmann denies that expectations are ultimate data like tastes and resources; against Lundberg and Schumpeter, he denies they can be deduced from objective business situations. A price rise may signal reversion or inflation, so meaning arrives only through the actor's interpretation, and economics needs ideal types and historical understanding rather than deterministic law. From this he builds a theory of plan-guided action and tests it on Hicks's elasticity of expectations and on interest-rate formation, concluding that an Austro-Wicksellian crisis requires a particular expectational climate. The essay makes intelligibility, not determinateness, the proper aim of social science.

The Social World consists not of facts but of our interpretations of the facts.

Can competitive price theory be taught convincingly before students encounter monopoly and imperfect competition? In this 1943 review of the preliminary edition of George J. Stigler’s The Theory of Competitive Price, Fritz Machlup weighs that pedagogical choice while testing the precision of definitions, diagrams, and explanations. His detailed corrections coexist with admiration for Stigler’s concise exposition: a demanding textbook can clarify theory without making it easy. The review offers a concrete view of what Machlup expects from economic instruction—analytical distinctions that hold up under scrutiny, assumptions whose purpose students understand, and technical tools connected to actual problems. His closing disagreement with Schumpeter over the book’s level turns on students’ mathematical preparation, leading to an insistence that advanced theory belongs in the undergraduate curriculum.

What should a textbook in the new field of econometrics teach—and which difficulties should it refuse to evade? In this 1943 review of Harold T. Davis’s The Theory of Econometrics, Gerhard Tintner weighs classroom usefulness against original research. He praises the exposition of economic statics but locates Davis’s strongest contributions in dynamics, particularly the treatment of serial correlation and forecasting, problems he considers too often avoided in economic statistics. His judgement draws on teaching experience: students with some calculus can, he argues, work through the book’s problems and acquire a substantial grounding in the subject. This compact review offers a concrete view of Tintner’s standards for econometric education, joining mathematical theory to the complications of observed economic data.

A party’s history is not necessarily the history of its principles. This distinction frames Hayek’s 1944 review of Henry Slesser’s A History of the Liberal Party: he finds the early narrative dry and overcompressed, but values the later reflections of a Labour politician troubled by the loss of liberal individualism. Hayek’s selection of quotations brings Slesser’s uneasy sympathies into focus—admiration for radical reform alongside regret for peaceful commercial internationalism and concern about expanding state power. Particularly revealing is the attention to insurance legislation that empowered ministers while restricting parliamentary and judicial oversight. This brief review shows what Hayek finds worth preserving in an otherwise disappointing history: concrete questions about whether reforms pursued under liberal auspices can erode liberal safeguards.

Openness to new economic ideas need not mean surrender to intellectual fashion. In this brief 1944 review of Oscar R. Hobson’s Can We Afford It?, Hayek praises a financial journalist who states an argument fairly before explaining why it leaves him unconvinced. Hayek’s almost complete agreement with Hobson is explicit, but his judgement also rests on the craft of making difficult questions intelligible in a few paragraphs. The review offers a compact statement of what he values in public economic discussion: attention to immediate policy problems, sensitivity to the ideas behind them, and resistance to treating either yesterday’s paradoxes or today’s commonplaces as final wisdom.

Can a decentralized competitive order modeled on Switzerland answer the problems of a Europe transformed by war? In this 1944 review, Karl Pribram tests Wilhelm Röpke’s proposed “third way” against the historical conditions it must confront. He appreciates Röpke’s scholarship and his effort to reconcile competition, social cohesion, and political liberty, but questions a diagnosis that traces modern upheaval to earlier revolutions while giving insufficient attention to National Socialism. Pribram’s distinctive contribution is to separate the appeal of an institutional ideal from its practical reach: independent farmers, skilled artisans, and decentralized industry may offer an attractive model without providing a transferable remedy. This brief review sharpens the question of what economic reconstruction requires when war has altered the society a reform program presupposes.

The question may be raised whether Röpke's analysis will still be applicable to the conditions of post-war Europe.

A monthly devoted solely to economics, launched in wartime Algiers, earns Hayek’s encouragement in this brief 1944 review. Reading the first, third, and fourth issues of La Revue Economique et Sociale, he notes a revealing contrast: a journal apparently intended for reconstruction and Allied information exchange devotes much of its space to broader questions about the state, liberalism, monopoly, and capitalism. His praise concerns the courage and resources needed to sustain such a forum, rather than agreement with its contributors’ doctrines. The review offers a compact glimpse of Hayek as a supporter of economic discussion across borders, attentive both to intellectual scope and to the practical conditions of publication.

In this brief review of Émile Cailliet’s La tradition littéraire des idéologues, Hayek finds material for an economic history the book itself does not attempt: the transmission of Condillac’s subjective approach to value through the French idéologues and their circle. His praise comes with a pointed reservation. Does treating these thinkers as precursors of Comtean positivism obscure the moderation that distinguished them from their supposed successors? Hayek credits Cailliet’s philosophical contextualization while questioning a genealogy that gives provocative naturalistic statements more weight than intellectual restraint. The review offers a compact glimpse of Hayek as a reader of intellectual history, attentive both to neglected contributions to utility theory and to the distortions of interpreting thinkers chiefly through what followed them.