Skip to main content Accessibility help

We use cookies to distinguish you from other users and to provide you with a better experience on our websites. Close this message to accept cookies or find out how to manage your cookie settings.

Close cookie message
×
Hostname: page-component-cd9895bd7-dk4vv Total loading time: 0 Render date: 2024-12-22T15:31:04.476Z Has data issue: false hasContentIssue false
Series:   Elements in Austrian Economics

Understanding Ludwig Lachmann's Economics

Published online by Cambridge University Press:  25 December 2023

Virgil Henry Storr  and
Solomon M. Stein
Virgil Henry Storr
Affiliation:
George Mason University, Virginia
Solomon M. Stein
Affiliation:
George Mason University, Virginia

Summary

Ludwig Lachmann is a central but underappreciated figure within the Austrian school of economics. Although his understanding of institutions, his appreciation of the heterogeneity of capital, his emphasis on subjectivity, and his focus on the dynamism and uncertainty of the real world have become dominant positions amongst Austrian economists, he is still viewed as something of an outsider. As such, the contributions of Lachmann's economics are arguably misunderstood. This Element attempts to tease out and discuss the critical contributions of Lachmann's economics. Arguably, one way in which to understand Lachmann's economics is by seeing it as unified in considering, in various ways, a single conceptual 'problem' – the apparent tension between the dynamic nature of social reality and the intelligible nature of the social world. Approaching Lachmann with this theme in mind allows us to put things together more coherently than other exegetical strategies.
Get access

Keywords

Ludwig LachmannplaninstitutionsAustrian economicsF.A. Hayek
Type
Element
Information
Series: Elements in Austrian Economics
Online ISBN: 9781009083539
Publisher: Cambridge University Press
Print publication: 01 February 2024

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Baetjer, H. (1998). Software as Capital: An Economic Perspective on Software Engineering. Los Alamos, NM: IEEE Computer Society.Google Scholar
Baetjer, H. (2000). “Capital as Embodied Knowledge: Some Implications for the Theory of Economic Growth,” Review of Austrian Economics, 13(1): 147–174.CrossRefGoogle Scholar
Boettke, P. (2014) “Entrepreneurship, and the Entrepreneurial Market Process: Israel M. Kirzner and the Two Levels of Analysis in Spontaneous Order Studies,” Review of Austrian Economics, 27(3): 233–247.Google Scholar
Boettke, P. (2020). The Struggle for a Better World. Arlington, VA: Mercatus Center at George Mason University.Google Scholar
Boettke, P., Coyne, C., and Leeson, P. (2008). “Institutional Stickiness and the New Development Economics,” American Journal of Economics and Sociology, 67(2): 331–358.Google Scholar
Boettke, P. J. and Piano, E. (2018). “Capital, Calculation, and Coordination,” Research in the History of Economic Thought and Methodology, 37B: 9–24.Google Scholar
Chamlee-Wright, E. (1997). The Cultural Foundations of Economic Development: Urban Female Entrepreneurship in Ghana. London: Routledge.Google Scholar
Chamlee-Wright, E. (2011). “Operationalizing the Interpretive Turn: Deploying Qualitative Methods toward an Economics of Meaning,” Review of Austrian Economics, 24: 157–170.Google Scholar
Dekker, E. 2016. The Viennese Students of Civilization: The Meaning and Context of Austrian Economics Reconsidered. Cambridge: Cambridge University Press.Google Scholar
Eicholz, H. (2017.) “Ludwig M. Lachmann: Last Member of the German Historical School,” Journal of Contextual Economics – Schmollers Jahrbuch, 137(3): 227–260.Google Scholar
Fleetwood, S. (1995). Hayek’s Political Economy: The Socio-economics of Order. London: Routledge.Google Scholar
Fritz, R. and Novak, R. (2022). “Order beyond Equilibrium: Ludwig Lachmann’s Bridging of Seemingly Irreconcilable Traditions,” History of Political Economy, 54(4): 719–744.Google Scholar
Geertz, C. (1973). The Interpretation of Cultures. New York: Basic Books.Google Scholar
Gloria, S. (2019). “From Methodological Individualism to Complexity: The Case of Ludwig Lachmann,” Review of Political Economy, 31(2): 216–232.Google Scholar
Harris, C., Cai, M., Murtazashvili, I., and Murtazashvili, J. (2020). The Origins and Consequences of Property Rights: Austrian, Public Choice, and Institutional Economics Perspectives. Cambridge: Cambridge University Press.Google Scholar
Hayek, F. A. (1941). The Pure Theory of Capital. Chicago, IL: University of Chicago Press.Google Scholar
Hayek, F. A. (1948). Individualism and Economic Order. Chicago, IL: University of Chicago Press.Google Scholar
Hayek, F. A. (1955). The Counter-Revolution of Science. London: Free Press of Glencoe.Google Scholar
Horwitz, S. (2004). “Monetary Calculation and the Unintended Extended Order: The Misesian Microfoundations of the Hayekian Great Society,” Review of Austrian Economics, 17: 307–321.CrossRefGoogle Scholar
John, A. and Storr, V. H. (2013). “Ethnicity and Self-Employment in Trinidad and Tobago: An Empirical Assessment,” International Journal of Entrepreneurship and Small Business, 18(2): 173–193.Google Scholar
John, A. and Storr, V. H. (2018). “Kirznerian and Schumpeterian Entrepreneurship in Trinidad and Tobago,” Journal of Enterprising Communities: People and Places in the Global Economy, 12(5): 582–610.Google Scholar
Kirzner, I. (1967). “Methodological Individualism, Market Equilibrium, and Market Process,” Il Politico, 32(December): 787–799.Google Scholar
Kirzner, I. (1992). The Meaning of Market Process: Essays in the Development of Modern Austrian Economics. New York: Routledge.Google Scholar
Kirzner, I. (2000). The Driving Force of the Market. New York: Routledge.Google Scholar
Kirzner, I. (2018). “The Limits of the Market: The Real and the Imagined,” in Boettke, P. and Sautet, F. (eds.), The Collected Works of Israel M. Kirzner: Reflections on Ethics, Freedom, Welfare Economics, Policy, and the Legacy of Austrian Economics. Indianapolis, IN: Liberty Fund: 384–394.Google Scholar
Koppl, R. (2002). Big Players and the Economic Theory of Expectations. New York: Palgrave Macmillan.CrossRefGoogle Scholar
Lachmann, L. (1971). The Legacy of Max Weber. Berkeley, CA: The Glendessary Press.Google Scholar
Lachmann, L. (1977). Capital, Expectations, and the Market Process: Essays on the Theory of the Market Economy, Grinder, W. (ed.). Kansas City, MO: Sheed Andrews and McMeel.Google Scholar
Lachmann, L. (1978a [1956]). Capital and Its Structure. Menlo Park, CA: The Institute for Humane Studies.Google Scholar
Lachmann, L. (1978b) “An Austrian Stocktaking: Some Unanswered Questions and Tentative Answers,” in Spadaro, L. (ed.), New Directions in Austrian Economics. Kansas City, MO: Sheed Andrews and McMeel: 1–18.Google Scholar
Lachmann, L. (1994). Expectations and the Meaning of Institutions, Lavoie, D. (ed.). New York: Routledge.Google Scholar
Lachmann, L. (2020 [1986]). The Market as an Economic Process. Arlington, VA: Mercatus Center at George Mason University.Google Scholar
Lavoie, D. (1991). “The Progress of Subjectivism,” in de Marchi, N. and Blaug, M. (eds.), Appraising Economic Theories: Studies in the Methodology of Research Programs. Aldershot: Edward Elgar: 470–491.Google Scholar
Lavoie, D. (2011). “The Interpretive Dimension of Economics: Science, Hermeneutics, and Praxeology,” Review of Austrian Economics, 24: 91–128.Google Scholar
Lavoie, D. (2016 [1985]). Rivalry and Central Planning. Arlington, VA: Mercatus Center at George Mason University.Google Scholar
Lavoie, D. and Chamlee-Wright, E. (2000). Culture and Enterprise: The Development, Representation, and Morality of Business. New York: Routledge.Google Scholar
Lewin, P. (1994) “Knowledge, Expectations, and Capital: The Economics of Ludwig M. Lachmann,” Advances in Austrian Economics, 1: 233–256.Google Scholar
Lewin, P. (2018). “Ludwig Lachmann: Enigmatic and Controversial Austrian Economist,” Liberty Matters, July. https://oll.libertyfund.org/page/liberty-matters-peter-lewin-ludwig-lachmann-austrian-economics. Accessed January 1, 2023.Google Scholar
Lewin, P. and Baetjer, H. (2015). “The Capital-Using Economy,” in Boettke, P. and Coyne, C. (eds.), The Oxford Handbook of Austrian Economics. Oxford: Oxford University Press: 145–163.Google Scholar
Lewis, P. (2008). “Solving the ‘Lachman Problem’: Orientation, Individualism, and the Causal Explanation of Socioeconomic Order,” American Journal of Economics and Sociology, 67(5): 827–857.Google Scholar
Lewis, P. (2011). “Far from a Nihilistic Crowd: The Theoretical Contribution of Radical Subjectivist Austrian Economics,” Review of Austrian Economics, 24: 185–198.Google Scholar
Lewis, P. and Runde, J. (2007). “Subjectivism, Social Structure and the Possibility of Socio-economic Order: The Case of Ludwig Lachmann,” Journal of Economic Behavior and Organization, 62(2): 167–186.Google Scholar
Loasby, B. J. (1998). “Ludwig M. Lachmann: Subjectivism in Economics and the Economy,” in Koppl, R. and Mongiovi, G. (eds.), Subjectivism and Economic Analysis: Essays in Memory of Ludwig M. Lachmann. New York: Routledge.Google Scholar
Martin, N. P. and Storr, V. H. (2008) “On Perverse Emergent Orders,” Studies in Emergent Order, 1: 73–91.Google Scholar
Mises, L. (1949). Human Action. San Franscico: Fox & Wilkes.Google Scholar
Palagashvili, L., Piano, E., and Skarbek, D. (2017). The Decline and Rise of Institutions: A Modern Survey of the Austrian Contribution to the Economic Analysis of Institutions. Cambridge: Cambridge University Press.Google Scholar
Prychitko, D. L. (1994) “Ludwig Lachmann and the Intrepretive Turn in Economics: A Critical Inquiry into the Hermeneutics of the Plan,” Advances in Austrian Economics, 1: 303–319.Google Scholar
Storr, V. H. (2019). “Ludwig Lachmann’s Peculiar Status within Austrian Economics,” The Review of Austrian Economics, 32(1): 53–75.Google Scholar
Storr, V. H. (2004). Enterprising Slaves and Master Pirates: Understanding Economic Life in the Bahamas. New York: Peter Lang.Google Scholar
Storr, V. H. (2012). Understanding the Culture of Markets. New York: Routledge.Google Scholar
Storr, V. H., Haeffele, S., and Grube, L. (2014). Community Revival in the Wake of Disaster: Lessons in Local Entrepreneurship. New York: Palgrave Macmillan.Google Scholar
Storr, V. H. and John, A. (2011) “The Determinants of Entrepreneurial Alertness and the Characteristics of Successful Entrepreneurs,” Annual Proceedings of the Wealth and Well-Being of Nations, 3: 87–108.Google Scholar
Storr, V. H. and John, A. (2020). Cultural Considerations within Austrian Economics. Cambridge: Cambridge University Press.Google Scholar
Stringham, E. P. (2015). Private Governance: Creating Order in Economic and Social Life. Oxford: Oxford University Press.Google Scholar
Thomsen, E. F. (1992). Prices and Knowledge: A Market Process Perspective. New York: Routledge.Google Scholar
Vaughn, K. (1994). Austrian Economics in America: The Migration of a Tradition. New York: Cambridge University Press.Google Scholar
Wagner, R. E. (2016). Politics as a Peculiar Business: Insights from a Theory of Entangled Political Economy. Cheltenham: Edward Elgar.Google Scholar
Wagner, R. E. (2020). “Entangled Political Economy: Mixing Something Old with Something New,” GMU Working Papers in Economics, 20–33.Google Scholar
Weber, M. (1949). “‘Objectivity’ in Social Science and Social Policy,” in Shils, E. A. and Finch, H. A. (eds.), Max Weber on the Methodology of the Social Sciences. Glencoe, IL: Free Press: 49–112.Google Scholar

Save element to Kindle

To save this element to your Kindle, first ensure [email protected] is added to your Approved Personal Document E-mail List under your Personal Document Settings on the Manage Your Content and Devices page of your Amazon account. Then enter the ‘name’ part of your Kindle email address below. Find out more about saving to your Kindle.

Note you can select to save to either the @free.kindle.com or @kindle.com variations. ‘@free.kindle.com’ emails are free but can only be saved to your device when it is connected to wi-fi. ‘@kindle.com’ emails can be delivered even when you are not connected to wi-fi, but note that service fees apply.

Find out more about the Kindle Personal Document Service.

Understanding Ludwig Lachmann's Economics
Available formats
×

Save element to Dropbox

To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Dropbox.

Understanding Ludwig Lachmann's Economics
Available formats
×

Save element to Google Drive

To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Google Drive.

Understanding Ludwig Lachmann's Economics
Available formats
×