The archive.

Production takes time—but does taking longer make it more productive? In this review of the second edition of Walter Eucken’s Kapitaltheoretische Untersuchungen, Emil Kauder tests capital theory against technological evidence, drawing on observations of American steelmaking to challenge any simple link between duration and efficiency. He also asks where a production period could actually begin: with the allocation of iron, leather, or a factory building? These concrete difficulties sharpen his objection to Eucken’s measurement procedure. Yet Kauder finds greater promise in Eucken’s treatment of interest, especially where price expectations and interdependent industrial investment loosen the original theoretical framework. The review distinguishes the problems Eucken exposes from the solutions Kauder finds convincing.

That production is time consuming does not necessarily imply that the theory of roundabout production is correct.

Can economics expose hidden value judgments without abandoning abstract theory? In this 1955 review of Gunnar Myrdal’s The Political Element in the Development of Economic Theory, Fritz Machlup accepts the demand that economists make the normative premises of policy recommendations explicit, but resists the claim that scientific analysis is therefore necessarily evaluative. His sharpest objection concerns Myrdal’s proposal to ground economics in people’s social attitudes: how can conflicting, changeable dispositions supply the foundation that supposedly objective welfare concepts could not? Reviewing the English translation, Machlup also distinguishes the original argument from Myrdal’s revised methodological position. The result offers a precise way to separate values required for policy, interests that guide research questions, and judgments made within economic analysis.

American trade policy of the 1950s contained a puzzle Haberler sets out to resolve: Washington condemned imperial preferences and discriminatory tariffs while applauding customs unions, even though a customs union discriminates against outsiders more sharply than a mere preference does. His resolution turns on economic effect rather than the degree of discrimination. A preferential regime keeps separate national tariffs and invites product-by-product bargaining and capture by protected interests; a complete customs union abolishes internal barriers wholesale, adopts a common external tariff, and is far likelier to create trade than to divert it. He judges genuine unions rare, Benelux being the modern instance, and insists Japan's viability depends on worldwide markets rather than an Asian bloc, holding throughout to multilateralism and the most-favoured-nation clause.

If tariff preferences are bad because they imply discrimination, then a customs union should be worse because it implies a higher degree of discrimination.

Where classical physics can specify its variables with precision, the sciences of complex order cannot, and Hayek builds an entire method around that limit. Accepting Popper's view that theories are deductive systems which forbid events and invite falsification, he rejects the further demand that science must always uncover new laws yielding exact predictions. Prediction, on his account, comes in degrees: to exclude a single outcome, narrow a range, or state a disjunction is still to predict. His central instrument is the explanation of the principle, which begins from familiar mechanisms and asks whether their combined operation could generate an observed pattern, evolution by natural selection being the paradigm. For biology, economics, and institutions, the honest goal is orientation and cultivation, not the control the physics template falsely promises.

The practical value of such knowledge consists indeed largely in that it protects us from striving for incompatible aims.

There is no such thing as 'the' interest rate, only a plurality of rates differing by term, market, risk, and realizability—and from that dismantling Mahr builds his central claim. Interest, he holds, has no determinate effect on how much people save but a decisive effect on the form savings take, and thus on the supply of funds for productive investment. Offered here in the German version of a 1955 Italian essay, the study separates risk premia from a narrowed notion of liquidity and faults Keynes for grounding interest wholly in the striving for liquidity. Since saving depends chiefly on income, the rate matters most by steering wealth toward productive credit or away into cash hoards, land, and durable Sachsparen; net interest, Mahr concludes, could never sink to zero of its own accord.

Aber es geht viel zu weit, die Zinserklärung zur Gänze auf dem Liquiditätsstreben zu basieren, wie dies Keynes tut.

English translation: “But it goes much too far to base the explanation of interest entirely on the striving for liquidity, as Keynes does.”

A barber’s basin can become a knight’s helmet—but what allows two people to live together while seeing different objects? In this essay, Alfred Schütz brings William James’s theory of multiple realities to Cervantes’s novel, shifting attention from Don Quixote’s errors to the conditions that sustain his world. Enchantment absorbs contradictory evidence; Sancho’s compromises make a shared life possible. Yet the Duke and Duchess’s staged confirmations expose the difference between genuine understanding and manipulative accommodation. For Schütz, the knight’s eventual disenchantment is not simply reason’s victory: it also destroys the vocation that made his life coherent. Through these encounters, readers can examine how ordinary certainty depends on interpretive commitments and trust—and why apparent agreement need not amount to a shared reality.

From a Vienna childhood under Carl Menger's tutelage to advisory rooms in wartime Washington, these memoirs follow a banker who cast himself as a forecaster of storms—the 'political meteorologist' of the title. Somary recounts learning marginal utility as it dissolved the labor theory of value, befriending Schumpeter and Otto Bauer, and building at the Anglo-Austrian Bank a career that let him attempt an Anglo-German naval détente before 1914. Independence, he insists, was the price and reward of foresight: his warnings against unrestricted submarine warfare, postwar inflation, the Great Depression, and Hitler repeatedly isolated him from opinion and power. The later chapters carry him through Swiss supply missions to the United States, a skeptical view of Keynes at Bretton Woods, and a lifelong reading of his age as the long aftermath of the French Revolution.

Beide Männer scheiterten in ihrem Vaterland. Jeder der beiden hatte nur im Ausland wirklichen Erfolg, und doch hatten sie eines gemeinsam: Außerhalb ihres Heimatlandes fühlten sie sich wie im Exil.

English translation: “Both men failed in their native country. Each of them enjoyed real success only abroad, and yet they had one thing in common: outside their homeland they felt as if in exile.”

Export success can leave domestic timber processors struggling to obtain affordable supplies. In this 1955 article, Hans Bayer examines that tension in Austria, connecting international demand with sawmills’ weak capitalization, delayed customer payments, and forestry’s slow production cycle. He argues that higher prices cannot reliably restore balance: they may instead drive users permanently toward substitute materials, damaging forest owners’ longer-term interests. Neither unrestricted markets nor permanent export restrictions, in his account, can reconcile remunerative forestry prices with domestic supply and export opportunities. His alternative combines negotiation among producers, processors, workers, and consumers with an export levy financing a timber-industry bank, backed by possible state intervention. The article offers a concrete view of how credit provision and negotiated coordination might stabilize a market whose physical supply cannot quickly respond to price.

Government planning and the disintegration of the world economy, Sennholz argues, are two faces of one process: the tariffs, exchange controls, and nationalizations that wreck the international division of labor also spawn the unification schemes meant to repair it. Writing from Mises's orbit with Earhart Foundation support, he marches through the postwar projects, Streit's federal union of democracies, Coudenhove-Kalergi's Pan-Europe, the socialist United States of Europe, the Council of Europe, the International Monetary Fund, the European Payments Union, and the Coal and Steel Community, and finds each fatally wedded to the interventionism it cannot survive. Capitalism and socialism, he insists, cannot coexist in one customs-free federation; the ECSC is a supranational monopoly over coal and steel. His alternative is unilateral free trade, sound gold-backed money, and a state confined to protecting life and property.

There is only one reason for an unsatisfactory operation of the market economy: it is government intervention.

What broke postwar Europe into protected national compartments—the free market, or the governments that overrode it? Reviewing Hans F. Sennholz's book of that title, Mises turns the reigning diagnosis on its head. Where pseudo-economists and statesmen blamed capitalism for poverty, unemployment, depression, and international disintegration, he answers that Europe's economic fragmentation is the work of state regulation and protectionism, not of laissez-faire. A government that fixes prices, wages, or output cannot leave foreign competition free to undermine its controls, so isolation follows from planning as a matter of course. Conventions, conferences, and American subsidies, he argues, cannot restore unity while domestic interventionism persists. Europe's survival depends not on new supranational architecture but on removing the national controls that make open exchange impossible.

The economic disintegration of Europe is not an outcome of the unhampered operation of the capitalist system.

Inequality, on Mises's reading, is not a defect for policy to correct but the very mechanism by which consumers steer production—rewarding entrepreneurs who serve them and stripping resources from those who fail. He distinguishes capitalist fortunes, built by supplying the masses with goods once beyond reach, from feudal wealth won by conquest, and argues that confiscating high incomes diverts capital from investment into consumption or state spending. Redistribution, he warns, has no principled stopping point once inequality is branded an evil: progressive taxation becomes a slope toward socialism. Invoking Henry Ford and the fate of the 1895 business structure, he presses the alternative to its edge—consumers or the state, market economy or socialism, with no third solution. The essay opens the collection's broader case against interventionism and the night-watchman state.

Inequality of wealth and incomes is the cause of the masses’ well-being, not the cause of anybody’s distress.

Postwar trade policy broke with the economic nationalism of the interwar years, and reciprocity became its governing principle—the ground on which Mahr, in 1955, builds a case that mutual liberalization, broad enough and paced with care, can raise national income without the feared wave of unemployment. He concedes the transition problem, that sheltered industries contract before resources migrate to exporting ones, but judges it commonly overstated. His decisive addition to foreign-trade multiplier analysis is the acceleration principle: expanding export industries call forth machinery, steel, and construction, a fresh investment demand that outweighs the replacement demand lost in shrinking sectors. Where prior protection ran very high, he allows devaluation over deflation; his caution is reversed against excessive speed, which would overstrain investment-goods capacity. The horizon is OEEC integration, with inner and outer circles of participation.

Therefore the removal of trade barriers, if carried out not too slowly and faint-heartedly, will bestow prosperity upon the industries which produce investment goods.