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Economist Gustav Schmoller

Gustav Schmoller was an economist active in Germany in the lasthalf of the nineteenth century. The purpose of this research is to reconsider his ideas within the context of latetwentieth century society.

SCHMOLLER AND HIS IDEAS: RELATIONSHIP

Schmoller was a part of the historicist approach to economics generally, and a part of German economic historicism specifically (Ekelund, and Hebert, 1990). Historicists raised the issue, among others, "of whether economics could be studied apart from the political, historical, and social milieu . . ." (Ekelund, and Hebert, 1990, 246). Schmoller, however, went much further, as he eventually proposed that "received theory be completely discarded, owing to the unrealism of assumptions, to the degree of theoretical abstraction, and to the neglect of interrelated and relevant facts" (Ekelund, and Hebert, 1990, 249).

Schmoller's rejection of theoretical economics resulted in the acrimonious conflict with Carl Menger, which eventually led to the discrediting of the historicist movement (Heilbronner, 1987). This outcome was unfortunate, because, while it is

1 2patently absurd to reject out of hand theoretical economics, it is equally absurd to attempt to apply economic principles in a way which attempts to divorce it from its surrounding environments (Knight, 1956).

COMMUNAL INFLUENCES ON ECONOMIC ACTIVITY, ANDTHE ROLE OF ECONOMIC THEORY AND STRUCTURE

In a narrow sense, Schmoller's confrontation with Menger, which pitted the historicists against the Austrians, was an argument between the Austrian concentration "the subjective, atomistic nature of economics" (Ekelund, and Hebert, 1990, 321), which emphasized selfinterest, utility maximization, and complete knowledge as the grounds upon which economics must be built (Menger, 1871), and the historicists, who held that, in "every phase of economic development, a guiding and controlling part belongs to some one or other polit...

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Economist Gustav Schmoller. (1969, December 31). In LotsofEssays.com. Retrieved 09:02, March 28, 2024, from https://www.lotsofessays.com/viewpaper/1683912.html