Hayek

1930 - 1945 Intellectial construction and dilemma

1931
Friedrich von Hayek

Friedrich von Hayek (1899-1992) lectured at LSE from 1931-50 as the University of London's Tooke Professor of Economic Science and Statistics. Hayek had been influenced by Fabian socialism and the work of Sydney and Beatrice Webb when he was young, but his attention was soon absorbed by economic liberalism. He gained his first doctorate in Law at the age of 21 (Studying law allowed him to specialise in economics), and his second in Political Economy at 23.

His first lectures at the School caused a sensation and were published as Prices and Production (1931). He was a major figure in the Cambridge-London economics controversy with Keynes during the 1930s, and he was an important stimulus to LSE thought for nearly 20 years. Hayek found international fame with the publication of The Road To Serfdom (1944), an account of how democratic socialism can be subverted to totalitarianism. It provoked a huge response, receiving both praise and loathing. In 1944 Hayek was elected as a Fellow of the British Academy, his appointment proposed by Keynes. Dedicated to the preservation and recovery of liberalism against the threats posed to it by the increased role collectivism assigns to the state, it was also in 1944 that Hayek proposed the idea of an international society of liberal intellectuals to discuss the principles underlying free and liberal society. His idea came to life in 1947 with the foundation of the Mont Pèlerin Society on the shores of Lake Geneva. The scholars who gathered there came from all over the world, and the meeting debated topics including government interventionism, liberalism, free enterprise and the competitive order, and the problems and chances of a European Federation in post-war Europe. The Society still exists today, meeting around the globe as a forum for discussing and interpreting the principles of economic society. Hayek considered founding the Society one of his greatest achievements. Hayek slipped from vogue as Liberalism came to be seen as out of synchronization with modern industrial societies, but his work proved resilient. A renewed interest in Hayek's liberalism developed in the 1970s-80s, and his economics again came to the fore in the 1990s with the end of the Keynesian ascendancy and the realisation that Hayek's work offered insights into economic co-ordination yet to be exceeded. Economic liberalism rose to prominence in the USA and the UK of the 90s, inspiring the economic policy of the New Right. In 1950 Hayek left LSE for the University of Chicago as Professor of Social and Moral Science. He has been described as the twentieth century's leading philosopher of liberty, and in 1974 he and Gunnar Myrdal jointly received the Nobel Prize for Economic Sciences 'for their pioneering work in the theory of money and economic fluctuations and for their penetrating analysis of the interdependence of economic, social and institutional phenomena.' His publications include: The Pure Theory of Capital (1941), Individualism and Economic Order (1949), The Constitution of Liberty (1960), Studies in Philosophy, Politics and Economics (1967), and The Political Order of a Free People (1970).