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History of Political Economy 35.2 (2003) 346-348
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Friedrich Hayek: A Biography. By Alan Ebenstein. New York: Palgrave, 2001. xiii; 403 pp. $29.95.
“The purpose of this work is to trace the intellectual life of Friedrich Hayek. Hayek was the greatest philosopher of liberty during the twentieth century” (xi).
This book has its virtues, not the least of which is its readability. But it is not a book for economists, nor for those who the author persists in calling “economic historians,” that is, historians of economics. From our point of view Hayek is not well served by his disciples who neglect his contributions to economics in favor of his later writings in social philosophy.
Friedrich August von Hayek was born in Vienna on 8 May 1899. He served with the field artillery of the Austro-Hungarian army on the Italian front before studying law and economics at the University of Vienna (1918–21). After completing his doctoral dissertation while working for a government agency set up to deal with the financial clauses of the peace treaty, he spent just over a year in the United States in 1923–24. With an introduction from Ludwig von Mises to Professor Jeremiah W. Jenks he worked as Jenks's research assistant for six months and registered as a doctoral student at New York University, also attending lectures at Columbia, especially those of Wesley Mitchell. On his return from America Hayek became an active participant in Mises's famous seminar; when Mises set up the Austrian Institute for Business Cycle Research in 1927 he appointed Hayek as its first director. By 1929 Hayek had obtained his Privatdozentur and began lecturing at the University of Vienna. Ebenstein tries, with some success, to evoke the atmosphere of Vienna and its famous university, and he provides many details of Hayek's childhood and early adult life, taken from unpublished autobiographical notes and those published in Hayek on Hayek (1994) as well as the interviews Hayek gave to members of the Oral History Program at UCLA.
As Ebenstein reports (chapter 6), Hayek's work in economics came to the attention of Lionel Robbins, newly appointed professor of economics at the London School of Economics (LSE), through his article attacking the underconsumptionist theories of William Trufant Foster and Waddill Catchings, and Hayek was subsequently invited to give four public lectures at LSE. The lectures in the last week of January 1931 were unexpectedly successful in spite of their halting delivery, and to Hayek's great surprise led to an invitation from the director of LSE, William Beveridge, to teach at LSE, first as a visiting professor for the 1931–32 academic year. Hayek and Robbins swiftly became and remained, until Hayek left London [End Page 346] and his wife and children for America in December 1949, close friends. Ebenstein's description of LSE in Hayek's time is not very convincing, since he dwells to a considerable extent on characters, such as Edwin Cannan, Graham Wallas, and Clement Attlee, who had retired or resigned well before Hayek's arrival; he is better on the younger economists who studied or taught at LSE in the 1930s, although his own ideological stance leads him to include Arthur Seldon as one of the “most prominent economists to come forward at LSE during the 1930s” along with Hayek, Robbins, John Hicks, Ronald Coase, Nicholas Kaldor, Abba Lerner, and Arnold Plant (63). In these years Hayek worked and published on several areas in economics, becoming a major participant in the active and important debates on the causes of unemployment, business cycles, the possibilities of socialist planning, the theory of capital, and economic methodology. The deficiencies of the book for an economist reader really begin when Ebenstein tries to discuss Hayek's economic theories. Money and business fluctuations, capital, the international gold standard, “socialist calculation,” and “economics, knowledge, and information” receive a chapter apiece (chapters 9 to 13), but the first of these, on what many economists regard as Hayek's contribution to economics, is less than four pages in length, and the other four are...