Ludwig Lachmann

Ludwig Lachmann
File:Ludwig lachman.jpg
Born	(1906-02-01)1 February 1906 Berlin, German Empire
Died	Johannesburg, South Africa
Nationality	German
School or tradition	Austrian School
Influences	Friedrich Hayek Carl Menger
Influenced	Bruce Caldwell

Ludwig Maurits Lachmann (German: [ˈlaχman]; 1906–1990) was a German economist who became a member of and important contributor to the Austrian School of economics.

Education and career

Lachmann earned his Ph.D. from the University of Berlin, where he was enrolled as a graduate student from 1924 to 1933. He first became interested in Austrian economics while spending the summer of 1926 at the University of Zurich. He graduated in 1930, and spent a few years to teach at the University. When Adolf Hitler rose to power in 1933, Lachmann moved to England. At the London School of Economics he was a student and later colleague of Friedrich Hayek, who held the prestigious Tooke Chair and looked for "allies in his battle against fashionable Keynesian theories". He deepened his interest in the Austrian School, and was one of the few who chose Hayek's side.

In 1948, Lachmann moved to Johannesburg, South Africa, where he accepted a professorship at the University of the Witwatersrand. He remained there until retiring in 1972. His student Peter Lewin described his influence in South Africa as "quiet, limited and subdued", quite in contrast to his New York years. He served as president of the Economic Society of South Africa from 1961 to 1963.

Austrian School revival, New York City, 1974-1987

Between 1974 and 1987, Lachmann traveled to New York City each year and collaborated on research with Israel Kirzner who intended to reinvigorate the Austrian school. One result of this collaboration was the 'Austrian Economics Seminar', organized by Lachmann as visiting professor at New York University each winter semester from 1975 to 1987. He was on residence there with his wife for four consecutive months, returning to South Africa in between for 12 consecutive years. A 1974 conference on Austrian Economics at Royalton College, in South Royalton, Vermont featured Lachmann, Kirzner, and Murray Rothbard, who challenged prevailing Keynesianism, attracted 50 participants and led to a 1976 book publication "The Foundations of Modern Austrian Economics".

On economics

Lachmann grew to believe that the Austrian School had deviated from Carl Menger's original vision of an entirely subjective economics. To Lachmann, Austrian Theory was an evolutionary, or "genetic-causal" approach, as opposed to the equilibrium and perfect-knowledge models used in mainstream neoclassical economics. He was a strong advocate of using hermeneutic methods in the study of economic phenomena. Lachmann's "fundamentalist Austrianism" was rare as few living Austrian economists departed from the mainstream. He underscored what he viewed as distinctive from that mainstream: economic subjectivism, imperfect knowledge, the heterogeneity of capital, the business cycle, methodological individualism, alternative cost and "market process". His brand of Austrianism now forms the basis for the "radical subjectivist" strand of Austrian Economics. His work influenced later, American developments of the Austrian School.

To commemorate Lachmann, his widow established a trust to fund the Ludwig M. Lachmann Research Fellowship at the Department of Philosophy, Logic and Scientific Method of the London School of Economics.

Contemporary social science research

Lachmann's ideas continue to influence contemporary social science research. Many social scientific disciplines explicitly or implicitly build on "radical subjectivist" Austrian Economics.

Books

• Uncertainty and liquidity preference. (1937).
• Capital and Its Structure, 1956, mises.org.
• The Legacy of Max Weber, 1971, mises.org.
• Macro-economic Thinking and the Market Economy, 1973, mises.org.
• From Mises to Shackle: an essay on Austrian economics and the Kaleidic society. In: Journal of Economic Literature 14 (1976), 54–62.
• Capital, Expectations and the Market Process, 1977, mises.org.
• The flow of legislation and the permanence of the legal order. (1979).
• The salvage of ideas. problems of the revival of Austrian economic thought. (1982).
• Austrian Economics: a hermeneutic approach. (1990).
• G.L.S. Shackle’s place in the history of subjectivist thought. (1990).
• D. Lavoie (editor): Expectations and the Meaning of Institutions: Essays in Economics by Ludwig Lachmann. Routledge, London/New York 1994.

See also

• Kaleidics

External links

• Critique on The History of Economic Thought Website, cepa.newschool.edu
• "The Kaleidic World of Ludwig Lachmann," Review of The Market as an Economic Process by Roger Garrison, Critical Review vol. 1, no. 3 (Summer), 1987, pp. 77–89.auburn.edu
• "The Lachmann Legacy: An Agenda for Macroeconomics," Roger Garrison, auburn.edu

Further reading

• (Biographical aspects)
• (on Lachmann's view of government)