Quarterly Journal of Austrian Economics
The Hayek and Mises Controversy: Bridging Differences
Volume 7, No. 1 (Spring 2004)
This paper has attempted to bridge unresolved differences remaining from the Hayek and Mises “controversy,” which materialized in the early 1990s. In achieving this, the paper sought to provide an explanation of how Salerno, Rothbard and Herbener (SRH) came to interpret Hayek and Mises as distinct rather than complementary thinkers regarding socialism. It was argued that the distinction made is ultimately based on a view of Hayek as a near-equilibrium or proximal-equilibrium theorist. This means that Hayek conceives the economy as operating sufficiently close to a final or a static state of equilibrium, where present (i.e., immediately past) prices contain all the information necessary to guide producers in making optimal resource allocation decisions—an interpretation of Hayek that is in sharp contrast to Mises’s view of the problem of socialism. It was also argued that while there is strong textual evidence to support the SRH interpretation of Hayek’s view of the market, it de-emphasizes Hayek’s later writings on the broader issues of social order and progress, which emphasize “discovery” and “learning.” The paper also points to the importance of focusing Austrian economics towards positive, rather than negative heuristics. In doing so, Austrians ought to take full advantage of both of Mises’s and Hayek’s many and excellent writings (and other Austrians). The focus on a too narrow aspect of these scholars’ thoughts, such as those of Hayek’s, holds the risk of resulting in unnecessary disagreements, among Austrians, as has been exemplified by the “Hayek and Mises Controversy.”
Cite This Article
Stalebrink, Odd J. "The Hayek and Mises Controversy: Bridging Differences." The Quarterly Journal of Austrian Economics 7, No. 1 (Spring 2004): 27–38.