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Economics of the Free Society
Economics of the Free Society first appeared in Austria in 1937. Since then, nine German editions have been published, along with French, Swedish, Italian, Finnish, and English editions. The book's purpose is to provide a coherent description of the whole of the economic process, and to analyze current burning questions from an economic perspective. Written for the intelligent layman, as well as the student of economics, Economics of the Free Society is more than just an exercise in economic analysis, it is a masterpiece of economic wisdom and wit.
290 pages, Paperback
First published January 1, 1937
6 people are currently reading
80 people want to read
About the author
Wilhelm Röpke
56 books24 followersWilhelm Röpke (October 10, 1899 – February 12, 1966) was Professor of Economics, first in Jena, then in Graz, Marburg, Istanbul, and finally Geneva, Switzerland, and one of the spiritual fathers of the social market economy, theorising and collaborating to organise the post-World War II economic re-awakening of the war-wrecked German economy, deploying a program sometimes referred to as the sociological neoliberalism (compared to ordoliberalism, a more sociologically inclined variant of German neoliberalism).[1]
With Alfred Müller-Armack and Alexander Rüstow (sociological neoliberalism) and Walter Eucken and Franz Böhm (ordoliberalism) he elucidated the ideas, which then were introduced formally by Germany's post-World War II Minister for Economics Ludwig Erhard, operating under Konrad Adenauer's Chancellorship.[1] Röpke and his colleagues' economic influence therefore is considered largely responsible for enabling Germany's post-World War II Economic "Miracle." Röpke was also an historian.
With Alfred Müller-Armack and Alexander Rüstow (sociological neoliberalism) and Walter Eucken and Franz Böhm (ordoliberalism) he elucidated the ideas, which then were introduced formally by Germany's post-World War II Minister for Economics Ludwig Erhard, operating under Konrad Adenauer's Chancellorship.[1] Röpke and his colleagues' economic influence therefore is considered largely responsible for enabling Germany's post-World War II Economic "Miracle." Röpke was also an historian.
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Displaying 1 - 3 of 3 reviews
January 18, 2020
10 May 2018
I read this book about 40 years ago (give or take 2-3 years) and generally liked it.
But I was not totally happy with it, since it compromised and was not well thought out on some important points. But most was good.
The main thing I remember about it was that the author pointed out one downside aspect for some people of the workings of division of labor (specialization) in a free society. He noted correctly the short term benefits of narrow-mindedness on one's particular profession or skill. Since, when people focus on one skill or aspect of making a product or service, they can certainly do a better job of it, because of that focus, just as Adam Smith pointed out in his classic 1776 Wealth of Nations.
Those who he competes with, who do not focus only on that skill, or whatever it takes to make a particular product or service generally do not get as good at it and produce far less total product. Adam Smith's pin factory example makes this concept come to life. But Röpke noted that though you may advance the world's knowledge, proficiency, productivity or happiness... only for a time. You could also get very wealthy, since you may actually provide the world with exactly what it wants... for a while.
But you can also cripple yourself, if you devote all your time and attention to that skill only. You may also endanger your future livelihood by being too narrow, lack wider perspective and degrade into a dullness because you are not keeping all your senses and faculties curious and aware and alive. So, when people (customers, bosses, co-workers, etc.) decide they want something different than what you have been providing them, unless you are able and willing to adapt, you are in a bad position. (This point and it's crucial and liberating alternatives are made very, very clearly in the wonderful book and on-line course: "Mindshift: Break Through Obstacles to Learning and Discover Your Hidden Potential" by Barbara Oakley.)
I believe that these issues are pretty obvious to anyone who thinks about them for a while. However, there is a long tradition of socialist writers who love to continue the myths about this issue.
Röpke totally misconstrued this obvious point, since, as I remember, he did NOT discuss the more realistic mode of operation of most people - saving capital to be able to take some time off from their specialty to smell the roses, develop new additional skills, think about the future, about art, about family, about poverty, injustice, etc. etc. In addition employers, managers, friends and family members are making it THEIR business to help employees, team members, friends, family, etc. to be aware of these things and keep this perspective. In other words, to be a more well-rounded, humane, potentially even "Renaissance" type individual - for their own long-term well being.
As I remember, Röpke even promoted government programs to keep people from being too narrow minded and focused only on their one career. However, here is Röpke's big contradiction: his idea is that the Free Society is in effect great, but we need MORE government to force us to make our lives better? This is not logical and it is not in tune with the facts of how people actually live and their desires for a better life and world. It also contradicts all we know about the ability (typically the inability) of government, "the monopoly on coercion in society", to do that task well. Anyone who looks at the actual performance of government retraining programs vs. private companies which do this know that the government agencies provide poor service or almost negative value.
I can't remember the good parts of the book, since I was so disappointed by this big error, but I am sure there are many good parts, since the book is well-liked by many and is still in print from a libertarian publisher.
2020-01-18 - More relatively minor style edits and additions.
2019-10-16 - Minor edits for clarification.
I read this book about 40 years ago (give or take 2-3 years) and generally liked it.
But I was not totally happy with it, since it compromised and was not well thought out on some important points. But most was good.
The main thing I remember about it was that the author pointed out one downside aspect for some people of the workings of division of labor (specialization) in a free society. He noted correctly the short term benefits of narrow-mindedness on one's particular profession or skill. Since, when people focus on one skill or aspect of making a product or service, they can certainly do a better job of it, because of that focus, just as Adam Smith pointed out in his classic 1776 Wealth of Nations.
Those who he competes with, who do not focus only on that skill, or whatever it takes to make a particular product or service generally do not get as good at it and produce far less total product. Adam Smith's pin factory example makes this concept come to life. But Röpke noted that though you may advance the world's knowledge, proficiency, productivity or happiness... only for a time. You could also get very wealthy, since you may actually provide the world with exactly what it wants... for a while.
But you can also cripple yourself, if you devote all your time and attention to that skill only. You may also endanger your future livelihood by being too narrow, lack wider perspective and degrade into a dullness because you are not keeping all your senses and faculties curious and aware and alive. So, when people (customers, bosses, co-workers, etc.) decide they want something different than what you have been providing them, unless you are able and willing to adapt, you are in a bad position. (This point and it's crucial and liberating alternatives are made very, very clearly in the wonderful book and on-line course: "Mindshift: Break Through Obstacles to Learning and Discover Your Hidden Potential" by Barbara Oakley.)
I believe that these issues are pretty obvious to anyone who thinks about them for a while. However, there is a long tradition of socialist writers who love to continue the myths about this issue.
Röpke totally misconstrued this obvious point, since, as I remember, he did NOT discuss the more realistic mode of operation of most people - saving capital to be able to take some time off from their specialty to smell the roses, develop new additional skills, think about the future, about art, about family, about poverty, injustice, etc. etc. In addition employers, managers, friends and family members are making it THEIR business to help employees, team members, friends, family, etc. to be aware of these things and keep this perspective. In other words, to be a more well-rounded, humane, potentially even "Renaissance" type individual - for their own long-term well being.
As I remember, Röpke even promoted government programs to keep people from being too narrow minded and focused only on their one career. However, here is Röpke's big contradiction: his idea is that the Free Society is in effect great, but we need MORE government to force us to make our lives better? This is not logical and it is not in tune with the facts of how people actually live and their desires for a better life and world. It also contradicts all we know about the ability (typically the inability) of government, "the monopoly on coercion in society", to do that task well. Anyone who looks at the actual performance of government retraining programs vs. private companies which do this know that the government agencies provide poor service or almost negative value.
I can't remember the good parts of the book, since I was so disappointed by this big error, but I am sure there are many good parts, since the book is well-liked by many and is still in print from a libertarian publisher.
2020-01-18 - More relatively minor style edits and additions.
2019-10-16 - Minor edits for clarification.
July 20, 2020
One of the fascinating aspects of Wilhelm Ropke, a somewhat unjustly obscure economist in the present world, is that he explored the economic basis of the free society and spent a great deal of time and effort discussing and defending a just economic and political order that demonstrated ordered freedom that nevertheless included concern for the well-being of society as a whole and what conditions were necessary to secure that well-being. This is not as common a phenomenon as one would hope. It is easy to pay lip service to such matters but hard to get to the brass tacks of actually setting up and defending a just social order. This book is admittedly pretty heavy on economic principles and that is not going to be everyone's taste, but to those who are able to wade through this book (and who will appreciate the book's entertaining endnotes at the end of each chapter), there is a lot here to inform as well as to appreciate. The author shows a winsome sense of humor even as he writes about serious and not always very entertaining subjects, and that is to be appreciated because economics is important even though it is by no means always fun.
This book is a bit more than 250 pages long and it is divided into nine somewhat lengthy chapters. The book begins with a preface and a translator's preface and this book was (somewhat unusually for the author) promoted after it was published by the Von Mises Institute. After that the author discusses the problem of free economics in ordered anarchy and the issue of choice and limitation (1). After that comes a discussion of the basic data of economics including moral foundations, costs, and possible systems of economic equilibrium (2). After that the author discusses the structure of the division of labor including its dangers and limits and our dependence on it (3). This is followed by a discussion of the history of money and credit, including inflation and deflation (4) as well a look at the world of goods and the flow of production (5). A chapter is devoted to markets and prices, including their interdependence (6) as well as a discussion of the distribution of income between rich and poor (7). The last two chapters cover disturbances of economic equilibrium including the impact of Keynesianism (8) as well as the structure of the economy as it relates to the current crisis (9), before the book closes with an index of persons and subjects.
It is perhaps to be regretted that the subject of economics is tedious enough that few relish it, thus leaving their economic worldviews to be informed by a mixture of prejudice and garbled and self-serving interpretations of the popular writings of those few economists that people are likely to be familiar with on a second-hand basis. It is our good fortune, at least, that we have available to us a host of excellent economists who have struggled with the relationship between morals, economics, and politics, as these are issues that are difficult to wrestle with and keep separated from each other. It may be easy to see that there is a class of people whose relative independence and sturdiness is a benefit to society at large and whom a great many people may claim to wish to protect and encourage but whose lives are made difficult by the political and economic policies pursued by governments nonetheless. In order for freedom to endure, the well-being of the general public has to be maintained, and political and economic power must be kept from being overly centralized in the hands of a few people or institutions where it becomes the subject of immense conflict, as is the case in our own world. As is often the case with Ropke, his sound writing about the problems of the first half of the 20th century give us plenty of food for thought and reflection today.
This book is a bit more than 250 pages long and it is divided into nine somewhat lengthy chapters. The book begins with a preface and a translator's preface and this book was (somewhat unusually for the author) promoted after it was published by the Von Mises Institute. After that the author discusses the problem of free economics in ordered anarchy and the issue of choice and limitation (1). After that comes a discussion of the basic data of economics including moral foundations, costs, and possible systems of economic equilibrium (2). After that the author discusses the structure of the division of labor including its dangers and limits and our dependence on it (3). This is followed by a discussion of the history of money and credit, including inflation and deflation (4) as well a look at the world of goods and the flow of production (5). A chapter is devoted to markets and prices, including their interdependence (6) as well as a discussion of the distribution of income between rich and poor (7). The last two chapters cover disturbances of economic equilibrium including the impact of Keynesianism (8) as well as the structure of the economy as it relates to the current crisis (9), before the book closes with an index of persons and subjects.
It is perhaps to be regretted that the subject of economics is tedious enough that few relish it, thus leaving their economic worldviews to be informed by a mixture of prejudice and garbled and self-serving interpretations of the popular writings of those few economists that people are likely to be familiar with on a second-hand basis. It is our good fortune, at least, that we have available to us a host of excellent economists who have struggled with the relationship between morals, economics, and politics, as these are issues that are difficult to wrestle with and keep separated from each other. It may be easy to see that there is a class of people whose relative independence and sturdiness is a benefit to society at large and whom a great many people may claim to wish to protect and encourage but whose lives are made difficult by the political and economic policies pursued by governments nonetheless. In order for freedom to endure, the well-being of the general public has to be maintained, and political and economic power must be kept from being overly centralized in the hands of a few people or institutions where it becomes the subject of immense conflict, as is the case in our own world. As is often the case with Ropke, his sound writing about the problems of the first half of the 20th century give us plenty of food for thought and reflection today.
July 7, 2023
I wish this was the book with wich I first encounter with the field of Economics. It's hard to get more info per page. It wasn't written with the modern textbook formalistic style, but with an authoritative yet more free style. I recommend everyone interested in understanding the economic realm of society to read this book or, as a second choice, Universal Economics.
Versión en español: LA TEORÍA DE LA ECONOMÍA (5.ª edición)
Versión en español: LA TEORÍA DE LA ECONOMÍA (5.ª edición)
Displaying 1 - 3 of 3 reviews