Heterodox Economics Newsletter

Issue 276 February 22, 2021 web pdf Heterodox Economics Directory

A few months ago, I wrote an editorial related to John King’s new book on alternative Austrian economics and provided a very rough bird’s eyes view on heterodox traditions in Austria. In doing so, I also promised to write a little more about Kurt W. Rothschild, who is not only my personal archetype of a good economist, but who can also be considered to be a leading pioneer among post-WWII heterodox authors in Austria and beyond.

First of all, Kurt W. Rothschild, who lived from 1914 to 2010, was a congenial character, one of these fine combinations of modesty and brilliance. I had the honor of meeting Rothschild a few times, although I was only born shortly before he formally went into retirement (as a hint: both events happened in the 1980ies). I was always impressed by the intellectual versatility he embodied and his curiosity & interest for the attitudes and opinions of other people - including my own, although I had only just finished my Masters-degree. To underscore these observations, it could be added, that Kurt W. Rothschild was often asked whether he bears any relation to the famous bankers family of the same name. In such situation his characteristic move was to put on a playful smile (basically an offline precursor of the winking smiley) and respond ironically with a simple „regrettably not“.

In his economics, Kurt Rothschild was a decidedly pluralist researcher, who always tried to make use of those theoretical approaches and ideas that have the best fit to the problem at hand. This strategy was closely in line with his general conviction that „a plurality of paradigms in economics and in social sciences is […] a necessary and desirable phenomenon in a very complex and continually changing subject“ (see here or here). Needless to say, that this kind of pragmatic openness, that often aims for identifying the comparative advantages and complementarities between different approaches rather focusing on competing or contradicting hypotheses, led Rothschild to take a heterodox stance on important theoretical or applied questions. Nonetheless, he was well respected also among the broad majority of mainstream researchers in Austria and, hence, was able to take an intermediating position between different paradigmatic approaches, that seems largely out of reach today due the increasing closure of the economic mainstream with respect to alternative conceptual views.

Probably Rothschild’s intellectual upbringing, which combined early neoclassical and Austrian economics taught at the University of Vienna in the 1930s and Marxian analyses as practiced within the Austrian socialist movement at the same time with the Keynesian stimulus that came in form of the General Theory, was especially conducive to the kind of open-mindedness practiced by Rothschild throughout his career. Nonetheless, it should be emphasized that Rothschild managed to assess, master and constructively integrate these different approaches under partially dire circumstances as a Jewish refugee in Switzerland and the UK.

Eventually, his approach towards economics allowed him to tackle a huge diversity of topics, issues & questions. Throughout his career he challenged Oskar Lange and inspired Kenneth Arrow with his philosophical take on rationality, developed novel approaches towards analyzing wages, unemployment and distribution or tried to advance new ideas for better understanding oligopolistic competition, e.g. by reintroducing explicit considerations of strategy and powerin economics. He often made the implicit relations between economics and other disciplines explicit in his work and aimed to make economics more receptive for insights from philosophy (e.g. when discussing the role of military spending in particular or the relation between ethics and economics in general) as well as neighbouring social sciences (e.g. by advocating for research programs that aim to understand the emergence of individual preferences out of social setups and relationships).

While an editorial can surely do no justice to a giant like Rothschild (who, by the way, would most probably object to this characterization), I hope to have at least inspired you to do some further reading on the subject – and if it’s only a glimpse into his official post-humous bibliography, that you will find here.

All the best,

Jakob

PS: In this context I should also point out that the Call for Submissions for this year’s Rothschild-Prize is still running till the 26th of April (international submissions are highly welcome!).

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