The Review of Austrian Economics, 14:1, 97–99, 2001.
2001 Kluwer Academic Publishers. Manufactured in The Netherlands.
(1999) The Evolution of Austrian Economics: From Menger
to Lachmann. Routledge: London and New York Routledge Studies in the History of
Economics 24, 208 pp., $90.00 cloth
The book, which emanates from the author’s Ph.D. thesis, is far from a simple historical
overview of Austrian thought as might be expected from a book published in the “Routledge
Studies in the History of Economics”. Gloria-Palermo analyzes the “Evolution of Austrian
Economics” with a mainly non-historic, analytical intention. Her project denounces the re-
search directiontakenby Austriansin the last decadeas being in sharpcontrast to the original
line of inquiry suggested by early Austrians such as Menger and Wieser. She proposes a
refocusing of this line of research, demonstrating a thorough and detailed knowledge of
Austrian economics and the ability to connect the details to an overall picture of the devel-
opment of Austrian ideas. The book starts out with an historical and analytical interpretation
of the development of Austrian thought and, in the ﬁnal chapters, provides suggestions to
reorient Austrian research by returning to a few key ideas developed by Carl Menger.
The book consists of four sections. In the ﬁrst section, the birth of Austrian economic
thought, based on Menger’s work, is elaborated upon. Two chapters demonstrate Menger’
analytical and methodological originality. The common view that Menger is associated with
the marginalists Jevons and Walras is forcefully refuted by the analysis of correspondence
between Menger and Walras.
Section twotreats the neglect anddecline of Menger’s lines ofthought. With the exception
of von Wieser, Menger’s originality is shown to be misunderstood by the ﬁrst generation of
Austrians. The discussionof B¨ohm-Bawerk’s workinchapter three, the Austrian occupation
with general equilibrium models due to positivistic inﬂuences in the fourth chapter, and
Austrian business cycle theory in the ﬁfth and last chapter of that section are used to
demonstrate the deviation from Menger’s ideas in the line of inquiry of his immediate
The ﬁrst chapterinthe third section—in which the main thesisof the author is presented—
deals withthe slowprocess ofresurrecting important aspectsof Mengerian thought.The next
two chapters, seven and eight respectively deal mainly with Mises, Rothbard and Kirzner.
Gloria-Palermo criticizes the non-scientiﬁc character of Rothbard’s writings as partly a
result of Mises’s praxeological approach. She identiﬁes this non-scientiﬁc approach, which
goes hand in hand with the arbitrary introduction of value judgements in the theory, as one
of the main reasons not only for the current acceptance problems of Austrian theory, but
also as an explanation for neglecting the important contributions of von Wieser due to his
divergent political views. The static characteristics of the entrepreneurial ﬁgure presented
by Kirzner, rightfully identiﬁed as a fall back to a pre-Schumpeterian notion of the role of
the entrepreneur in the economic process, are demonstrated. Kirzner’s efforts to reconcile