Emil Kauder as an Austrian Dehomogenizer
Rothbard’s two-volume An Austrian Perspective on the History of Economic Thought contains a lengthy reference list, but a close look at the books reveals that Rothbard continually cited certain authors and borrowed his theses from them. One of them was Emil Kauder. Kauder appears to be quite an important figure: a member of the third generation of Austrian economists in Vienna and a prolific scholar whose publications appeared in many academic outlets.
Yet, Kauder himself received little attention, if any, from the economics profession or even the Austrian circle. Only until recently has there been an attempt to recognize Kauder’s importance to the Austrian school.1
Austrians might know Kauder as someone who tried to overturn the Weberian thesis or as someone who initiated Adam Smith revisionism, as Rothbard cited him extensively by on these topics. That said, very few are aware that dehomoginization of Austrian thought was also a part of Kauder’s broader revisionism. Arguably, it is possible to trace the Austrian dehomogenization thesis—initiated by Joseph Salerno and splitting Austrian economics into two parallel streams after Menger (Wieser-Mayer-Hayek versus Böhm-Bawerk–Mises–Rothbard)—back to the 1950s, particularly to Kauder’s work.2
Kauder’s career did not feature many highlights: he was not very active in Vienna; after immigrating to the United States, he could not enter the academic world and he was severed from the Viennese network.3 Only after some correspondence with Oskar Morgenstern, who encouraged him to write on the history of economic thought, did Kauder start to publish again, particularly on the history of marginal utility theory.
At this time, Kauder’s Austrian revisionism arose, although he may have had thoughts on this topic before reentering the academic world: in a letter to Morgenstern, he referred to Morgenstern, Ludwig von Mises, Fritz Machlup, Dennis Strigl, and Schams as “the most diverse representatives of our common area of knowledge.”4
Kauder was arguably the first Austrian to attempt to separate the Wieser-Mayer strand from the Böhm-Bawerk-Mises strand, as in his discussion of utility theory, he targeted his critique to Friedrich von Wieser and Hans Mayer. In Kauder’s eyes, Wieser was never a dedicated Mengerian. There is no doubt that for Kauder, the Walrasian influence on Wieser was clear:
Wieser chose his own way of justifying theoretical knowledge, but finally the essences play a decisive role in his way of thinking. Wieser, the third pioneer of the Viennese school, differs from his colleagues. Besides Austrian tradition, contemporary intellectual movements shaped his understanding of society.5
Nevertheless, despite his dissatisfaction with Wieser, Kauder still applauded him for deducing correct economic theorems, especially marginal utility. Matters were different with Wieser’s student, Mayer, who from Kauder’s viewpoint had pushed the psychological method way too far, culminating in the meaningless concept of “total utility”:
Mayer may have been stimulated by these earlier thoughts. It is very likely that he also was familiar with Gestalt psychology, but his construction is apparently the product of his own thinking. Total welfare, in the sense of Mayer, can embrace the whole life, a day, or any period. It is not a st
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