Twenty-five years after
Gerald P. O’Driscoll Jr.
Published online: 5 February 2013
Springer Science+Business Media New York 2013
Keywords Austrian economics
JEL classification B25
It never occurred to me after finishing The Economics of Time and Ignorance that I
would be sitting on a panel a quarter-century later discussing the book. Indeed, when
Mario contacted me to let me know of its reissuance 10 years after the initial
publication, it was a pleasant surprise. In preparing for this session, I reread Mario’s
Introduction to the second edition and it motivated me to reconsider the influences on
us—or at least me—in writing the book.
The influence of having both Israel Kirzner and Ludwig Lachmann as colleagues
has been well-told, including in Mario’s Introduction. I want to go back further, to
Hayek. Over the years, I have come to view Hayek’s essay, “Price Expectations,
Monetary Disturbances and Malinvestments,” to be of overriding importance. I refer
to it as the Copenhagen Lecture because it evolved from a 1933 lecture in Copenhagen
and because of its unwieldy title. So Hayek made the substance of the essay’sargument
in 1933 and saw the essay published in German (later in French) in 1935. It did not
appear in English until the end of the decade (Hayek 1939).
The original lecture’s delivery date coincides roughly with the publication of
Hayek’s edited volume, Collectivist Economic Planning. It predates the 1937 essay,
“Economics and Knowledge.” He footnotes the 1933 lecture in that essay (at least in
the version reprinted in Individualism and Economic Order).
Hayek’s 1937 essay is
credited with the first statement of the proposition that equilibrium means that
individuals have correct foresight and that equilibrium is plan coordination. But that
conception is central to the argument of the Copenhagen lecture. In the lecture, he
insists on the necessity of making assumptions about what expectations of the future
Rev Austrian Econ (2013) 26:39–43
It is apparent that the footnote was at least updated for the book because Hayek cites the English
publication of the Copenhagen lecture, which was later than the essay’s original publication.
I wish to thank David Harper for organizing the panel at the 2011 Southern Economic Association meetings.
G. P. O’Driscoll Jr. (*)
Cato Institute, 1000 Massachusetts Avenue NW, Washington, DC 20001, USA