Transatlantic Roads to Mont Pèlerin: “Old Chicago” and Freiburg in a World of Disintegrating Orders

Abstract

This article depicts the parallel evolution of the political economies of the “Old Chicago” and Freiburg schools. Both communities within the “laissez-faire within rules” research program and the long-standing “thinking in orders” tradition emerged during the 1930s and culminated in the 1940s, crystallizing around the personalities of Henry C. Simons and Walter Eucken. We show how, in an age of disintegration of national and international orders of economy and society, the political economists at Chicago and Freiburg underwent a double transition: from students of equilibrium to students of order, and from students of various positive orders to defenders of a specific normative order. The vision of the normative order on both sides of the Atlantic was the competitive order and its rules-based framework. Along with shared angst amid disintegrating orders, personal transatlantic connections between the two communities are identified, starting in Berlin during the 1920s. We highlight the role of Friedrich A. Lutz, who, from the mid-1930s to Eucken's death and beyond, served as a lifeline between the isolated Freiburg school and Anglo-Saxon economists. Lutz's activities are embedded in a narrative of transatlantic conversations around Friedrich A. Hayek and the early meetings of the Mont Pèlerin Society.

When Liberty Presupposes Order: F. A. Hayek’s Contextual Ordoliberalism

“…Especially in the late 1930s, these transformations generated what can be called a "transatlantic neoliberal archipelago" of scholars who were "thinking in orders." Their emphasis on the role of rules and institutions can be subsumed under the motto "laissez-faire within rules," even though the understanding of rules and institutions varied (Kolev and Köhler 2022;Dekker forthcoming).…”

“…768-772) read as perfectly complementary contributions to the same research program. In 1947, Hayek was as close to Chicago and Freiburg as he would ever get-despite his forthcoming tenures at Chicago and Freiburg ( Van Horn 2009;Kolev and Köhler 2022).…”

“…Second, the earlier positive analysis of various types of order, as practiced for example in the Socialist Calculation Debates, was complemented from the late 1930s onwards with a normative defense of those specific orders that should prevent the implosion of orders, and which could enable a humane life in the new, less fragile frameworks (Dekker 2016). Especially in the late 1930s, these transformations generated what can be called a “transatlantic neoliberal archipelago” of scholars who were “thinking in orders.” Their emphasis on the role of rules and institutions can be subsumed under the motto “laissez-faire within rules,” even though the understanding of rules and institutions varied (Kolev and Köhler 2022; Dekker forthcoming).…”

“…The papers of Hayek, Eucken, and Director (the latter stepping in for the recently deceased Chicagoan Henry Simons; see Kolev and Köhler 2022, pp. 768–772) read as perfectly complementary contributions to the same research program.…”

Toward a theory of multifunctional liberalism: Systems‐theoretical reflections on the nature of statehood

“…In this sense, proponents and opponents of neoliberalism alike argued for decades over a target or problem description that, in systems‐theoretical terms, is the basic condition of a functionally differentiated society: the fundamental autonomy or ‘autopoiesis’ of both politics and economy. Accordingly, where the parties in the traditional dispute demand or seek to avert political intervention in the economy (Kolev & Köhler, 2022), a liberalism informed by systems theory would emphasize that politics cannot intervene in the economy, and that a state can only do so if it does not confuse itself with politics or society, but rather conceives of itself as only one (though sometimes particularly powerful) organization among others.…”