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Kirzner is a fantastic teacher and scholar. Fred Sautet and I are editing his collected works at the moment for Liberty Fund and the volumes should be starting to come out within the year --- 10 volumes in all.

Israel also represents within the Austrian tradition that lineage that goes from Vienna to LSE to NYU and includes not only Mises and Hayek, but also thinkers such as Schutz, Kaufman, Machlup, Morgenstern, Habeler (Vienna), Robbins, Shackle, Lachmann, Smith, Thirlby, Weisman (LSE). The program at NYU that he established not only had as faculty O'Driscoll, Rizzo, White and myself, but also had visitors such as Langlois, Caldwell, Maki, Boehm, Garrison, Harper, but also students such as Lavoie, Fink, Selgin, Ikeda, Klein, Boudreaux, Koppl, etc. And this NYU phase was all do to the heroic efforts of Israel Kirzner. As have these summer conferences.

He is just a man of great intellectual and personal integrity, and deep commitment to the teachings of his professor -- Ludwig von Mises --- and to the highest standards of scholarship and college level teaching.

I am so happy that his lectures will be available on-line for students to listen to now that never got the chance to see him in person. I hope FEE will make his talks through the years available in either video of mp3. And even with that, I fear it doesn't capture the essence of the man as an intellectual force. To me that is best captured in the more intimate setting of the research workshop, where the paper being presented is filled with his red pen mark-ups, and his keen intellect is focused on the argument being presented before him, and his penetrating criticisms are matched only by his wit and charm in presenting those criticisms. Those 8 years I spent at NYU attending those seminars with him were simply amazing. For that, I am afraid, you just have to be there to experience. The miracle of the internet cannot capture that.

I stopped listening at minute 15th when Kirzner asserted that revolutionary significance of Human Action has not been noticed until early 1970s when some "younger economists" discovered it.

This is simply flat out lie. In 1962 Rothbard's Man, Economy and State appeared that transformed Austrian School and exerted tremendous influence on generations of younger Austrian scholars, comparable with impact that Human Action itself had. Kirzner's portrayal of modern history of Austrian Schools is of Orwellian kind - nothing specially interesting did not happen in 1962 or 1963, Man, Economy and State and America's Great Depression were not signs of great Austrian revival at all. Rothbard did not exist at all (I don't know, maybe Rothbard shows up somewhere in the remaining part of the lecture, but beginning is not particularly encouraging, it seems like comrade Rothbard was removed from old official pictures).

Certainly, Kirzner is, along with Rothbard, one of two most important Mises's students from New York period. It is disappointing that he tries so shamelessly to exclude Rothbard from Austrian revival.


You really should listen to the entire lecture.

BTW, Kirzner published Market Theory and the Price System in 1963 and Essay on Capital in 1966. He doesn't claim them to be critical successes either. Lets look at sales, course adoptions, citations, reviews, etc. Any conceivable measure of influence in the profession to "test" Kirzner's empirical claim.

He is not making a judgment on quality, he is making a statement about facts concerning influence at a particular time in history. Listen to the claims being made and offer the appropriate criticism. As Kirzner often says of his own Market Theory and the Price System --- the biggest "failure" in academic publishing history. He didn't think it sold 100 copies, and it was supposed to be a textbook. At the same time, he will tell you (or you can read about it) that his work on coordination in that book laid the ground work for his later developments of the Austrian theory of the market process.

He is not excluding Rothbard from the Austrian revival (listen around 1:00 mark), he is explaining the reality of being an Austrian economists in a PhD granting educational institution in the 1960s and early 1970s.

And as a matter of empirical fact, Rothbard's Man, Economy and State had a significant influence among the small number of younger economists that Israel Kirzner is talking about --- Mario Rizzo and Jerry O'Driscoll; Roger Garrison; Larry Moss; Karen Vauhgn; Walter Block; Joe Salerno; Walter Grinder; Don Lavoie; Rich Fink; Jack High; Richard Ebeling, etc. all read Man, Economy and State and met Murray in his apartment to discuss ideas. Some of these individuals rose to be very close to Murray at various times between 1960-1980.

Of course, this doesn't address the influence that Murray had beyond economics through his book, including Man, Economy and State, on thinkers such as Ralph Raico, Ron Hamowy, and Leonard Liggio --- who in turn were very important thinkers and teachers at university and through their involvement with IHS and other groups during this period.

Israel Kirzner is talking about specific points about the economics profession. Remember the theme of his talk --- which is a puzzle --- had can the Austrian reputation fall so fast (in the 1930s and 1940s) when in his mind the major break through in economic science are about to made in 1940s in the writings of Mises and Hayek. Listen to his careful comments on Hayek's "The Meaning of Competition" and how Mises pointed this essay to him.

Professional influence is one thing, professional contribution is another. You can say someone didn't have influence, without saying that they didn't make a contribution. As Kirzner says later in the lecture, Rothbard was a major contributor/expositor of the Misesian system as he saw it. We all can agree with that.

Pete, as you say, Kirzner is amazing (particularly when you consider he is close to 80). His sense of humour in lectures is great, as well as his obvious intellectual power.

Like the kid with his hands over his ears singing "la, la, la, I can't hear you!", Nikolaj demonstrates his unwillingness to even consider a different view of the world. If it were some other Austrian, that would be one thing, but to dismiss Kirzner (Kirzner!) as a liar and a sinner against the plumb line *without even listening to the whole talk* is the sign of someone utterly uninterested in learning and only interested in spreading dogma.

Interesting that Kirzner explained that Frank Knight invented the concept of perfect competition as understood from all the textbooks: Infinite number of buyers and sellers, homogeneous commodities, etc. He gave the name to the concept.

But also, I think that this concept was really invented by Edgeworth when he demonstrated that the only possible equilibrium for a exchange economy with a infinite number of consumers (of the two types with he played in his boxes) is the walrasian/competitive allocation. Before him the first mathematical economists used the concept of price taking, but never provided a decent justification for it. Anyway, the more I read about perfect competition, more evident it seems that the concept was invented purely for formal/mathematical model building.

Dear Pete,
I finished listening Kirzner's talk. It was amazing, no doubt, I never denied his intellectual brilliancy and significance for Austrian School. As I said, I consider him one of the two most important Mises's pupils in USA.

Unfortunately, overall impression concerning the point I initially emphasized has been reinforced by the remaining of his talk. Moreover, it seems that things are even worse than I thought.

On the one hand I think Kirzner is perfectly right in emphasizing that difference between Mises and Hayek were overblown by some contemporary Misesians. I wrote something similar in a comment on one of the threads here at AE.

But, grave probem with Kirzner's interpretation of the newer history of Austrian School is that he assumes, without much evidence, that both Mises and Hayek underwent some far-reaching evolution of thought in 1940s. His interpretation of socialist calculation debate is strikingly similar to mainstream accounts of it, with one significant difference. Namely, mainstream canonical explanation goes as follows: first, Mises presented challenge to socialism claiming it was literally impossible since without prices there would not be a calculation whatsoever. Than market socialists proved that socialist government can combine state ownership with artificially set prices, in a manner of Walrassian auctioneer. Than Hayek "retreated on second line of defense", claiming that socialim was only "impractical" because of its inability to simultaneously solve enormous amount of differential equations and centralize knowledge in the hands of the clique of rulers. And than socialists after the second world war responded that powerful computers can solve all the problems with knowledge.

Kirzner agrees that something went wrong with Mises/Hayek argument in 1930, and only difference is that Kirzner doesn't seem to believe Mises remained stubborn in his stone age dogma (as mainstream accounts claim), but that he in Human action evolved along the Hayekian lines of accepting entrepreneurship, knowledge considerations and market process theory as big transformative analytical paradigms. In his view Hayek's retreat on the second line of defense (entrepreneurship, knowledge, practical considerations) was right and final word, and Mises followed him.

It is than obvious why Kirzner could not see anything important for the history of Austrian School in appearance of Man, Economy and State or America's Great Depression. Rothbard was "unreconstructed" Stone-age Misesian, who was not blessed by Kirznerian discovery that both Bohm Baverk and early Mises and Hayek were dead wrong. Conveniently, he places revival of Austrian School in "early 1970", just in time when his "Competition and Entrepreneurship" had appeared.

So, I think I can understand why Kirzner described Austrian economics "virtually dead" until the early 1970s. His early books you referred to were squarely in Misesian-Hayekian old paradigm based on Bohm Baverk's theory. That was praxeology with concept of purposefulness as connected with action and choice, not with discovery and alertness as Kirzner subsequently had reinterpreted it. In that regard, both Rothbard's masterpiece and Kirzner's old works belonged to Stone Age, to unreconstructed Austrianism. Kirzner reinterpreted Hayek by completely striping his theory of all praxeological elements, capital theory and all other "objectivist" Bohm Baverkian relicts. And than reinterpreted Mises in the same way, as consistent with his, Kirznerian Hayek! No surprise then that Machlup could not "understand" Human Action in the same way as Kirzner did, and that even Mises's himself maybe was not fully aware of the real meaning of his own book from 1949 (as Kirzner speculates in one of his works).

But, the most significant problem is that truth is the other way around in this regard. Both Mises and Hayek, contrary to what Kirzner asserts, in most part remained faithful to their Bohm Baverkian roots. Mises completely, Hayek not completely, but to significant extent. In every event Hayek remained Misesian in the most important thing, socialist calculation argument. In the very same book Kirzner cites as evidence of Hayek's "conversion" toward Kirznerian "new Austrianism" we find the paper "Competitive" solution..." in which Hayek refutes market socialism by implementing basically old Misesian stone-age argument that even market socialist cannot CALCULATE (not centralizing knowledge). And that paper was initially published in 1940! Mises's position in Human action is only systematization and lapidary exposition of Hayek's argument from that same paper! So, far from "revising" anything, Mises and Hayek did not tell in their 1949 books anything new about calculation debate that has not been repeated by them a 100 times during 1930s.

So, after listening whole talk I would say that Kirzner probably did not want to exclude Rothbard from Austrian revival for some personal or sectarian reason, but for theoretical ones. He, namely, wanted to exclude from the revival anybody (including early Kirzner himself!) who didn't accept mature Kirznerian radical subjectivist (mis)interpretation of Mises and Hayek.

In that connection Pete, I think that you are not right in ascribing to Kirzner your "success in the profession" type of argument (with "citation counts" and similar stuff) as criterion of Austrian revival. At the contrary, his own explanation for fast decline of Austrian economics in professional terms after 1940 was that acceptance of Austrian theory in the mainstream circles was very superficial, and that success of Mises and Hayek was possibly caused by their theory being very poorly and superficially absorbed. By the same token, one could plausibly expect that any significant acceptance of Austrian theory in the today's mainstream, could be only result of misunderstanding, or of compromising Austrian theoretical tenets to better fit the mainstream paradigm, or both.

I was at that lecture Nikolaj and I heard a totally different argument than what you've presented here.

Could Pete or Steve clarify something for me? At one point (around 1:05) Kirzner said that were Hayek alive today he would agree that his (Hayek's) understanding of competition was actually Kirzner's "entrepeneurial" one. I've never read Kirzner, but my impression is that Hayek ended up formulating a theory of competition that went further than just individual entrepreneurial acts and involved feed-back loops from consumers, etc...

Thank you in advance and sorry for the anonymity.

I have to second Pete's "amazing" comment in regards to Prof. Kirzner at the NYU colloquium. I attended for three years and I often went just to hear Prof. Kirzner ask questions.

A true scholar.

Steve (and others),

While I wouldn't say that the Kirzner interpretation of the revival of Austrian Economics is wrong, I do feel - but I don't want to claim strong opinions here: it's just a subjective opinion and I'm open to criticism - that professor Salerno gives a more detailed (and therefore accurate) story about the history of Austrian economics. Even if one doesn't agree with professor Salerno's opinion on the dehomoginizing Mises-Hayek debate, I had the feeling that professor Salerno gave some very convincing arguments in favor of his story of the revival.

I do however want to emphasize that I think professor Kirzner lecture focuses on different things than salerno's one. (Salerno's one was more historical: 'what happened', while Kirzner was more, in my opinion, more 'what were the intellectual debates going on'.) I see absolutly _no_ real reason why the 2 stories are not compatible, which is sometimes claimed.

The biggest difference, I think, is a matter of interpretation. The story told by professor Salerno is one which places the revival with Rothbard-Kirzner in the 1960's, while professor Kirzner focusses on the '74 meeting/nobelprice. I think the major difference is what we call a 'revival'. If one defines a revival as 'there are scholars working within the tradition and publishing good stuf' (even if there are only a few), then I would say one has to follow Salerno's view. If one defines 'revival' as 'Austrian Economics is known (and theories that come from Austrian economists are known) with a larger audience then the average soccerteam', then I would say that one ought to choose more of a Kirznerian approach.

This is my interpretation. If I'm right; it would mean that there is more a semantical difference then anything else.

Feel free to criticize it; but that was my interpretation, after attenting the two lectures.

The lecture I attended was at Mises U 2009 and can be listened too here:


I think the difference is that Kirzner was focusing on the relationship between AE and the economics profession rather than work internal to AE by itself, which sounds like Salerno's perspective. If I'm right, then sure, they are asking two different questions and getting two different answers, unsurprisingly. One isn't necessarily right and the other wrong. It's a matter of, as you say, how one is using "revival."

Lode Cossaer,

I think that you are wrong in assuming that the reason why Kirzner places Austrian revival in early 1970s is that he identifies revival with affirmation of AE in economic profession and the public.

Kirzner's main idea is that Hayek and Mises were defeated during 1930s, and defeated for a good reason ("they didn't know what hit them", as Kirzner repeated 5 time during lecture). All that they did during 1920s and 1930s was basically a mistake, or faulty theory refuted by socialists. And suddenly in 1949 in Human Action and Individualism and Economic Order, Mises and Hayek "reinvented" or radically reinterpreted Austrian economics, abandoning much of what they thought and written for decades. And nobody, including themselves was able to understand that for a long time. Mises, for example, was unaware of real meaning of Human Action when he praised early Kirzner's work, based on praxeological, Bohm Baverkian, "misunderstanding" of Human Action. Machlup was also under illusion that Human Action did not develop some radically new theory. Young Kirzner and Rothbard also wrote their books in 1960s completely unaware of that circumstance. And it was only after Kirzner's "Competition and Entrepreneusrhip" came out that "real" meaning of what Mises and Hayek did in 1949 became obvious.

Listen Kirzner's talk carefully. What he basically says is that Austrian revival is identical to spreading of his revisionist re-interpretation of Mises and Hayek from 1970s, as a prevailing way of understanding of Austrian economics. And that has nothing to do with "professional" criteria of revival.

Steve and Nikolaj,

Thank you both for your perspective on this issue. The point Horwitz made that they are asking different questions, appears to be correct.

I would, however, say that I don't think the perspective Nikolaj gave is right. I was at the seminar and talked to Kirzner. At no point what so ever I had the feeling that he thought that the Austrians were defeated 'for a good reason'.

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