Liberalism in Crisis and the Promise of a Reconstructed Liberalism

Journal of Contextual Economics – Schmollers Jahrbuch 139, no. 2–4, 2019

GMU Working Paper in Economics No. 20-13

37 Pages Posted: 19 Mar 2020 Last revised: 13 May 2020

See all articles by Peter J. Boettke

Peter J. Boettke

George Mason University - Department of Economics; Mercatus Center at George Mason University

Rosolino Candela

George Mason University - Mercatus Center

Date Written: May 5, 2020

Abstract

What explains the simultaneous critiques of economic theory and liberalism during the 1930s? Early neoclassical economists had a common understanding of the proper institutional context under-girding a liberal market order. From the marginal revolution emerged a growing emphasis on analyzing markets as equilibrium states rather than processes. Because the institutions that frame a liberal market order were taken as given, to the point of relative neglect, this resulted in the notion that markets operated in an institutional vacuum. The resulting association of liberalism with laissez faire, therefore, prompted a restatement of the role institutions play in the operation of a liberal market order.

Keywords: Walter Lippmann Colloquium; F.A. Hayek; Frank Knight; Ludwig Von Mises; Henry Simons

JEL Classification: B25; B31; P16

Suggested Citation

Boettke, Peter J. and Candela, Rosolino, Liberalism in Crisis and the Promise of a Reconstructed Liberalism (May 5, 2020). Journal of Contextual Economics – Schmollers Jahrbuch 139, no. 2–4, 2019, GMU Working Paper in Economics No. 20-13, Available at SSRN: https://ssrn.com/abstract=3539237 or http://dx.doi.org/10.2139/ssrn.3539237

Peter J. Boettke

George Mason University - Department of Economics ( email )

4400 University Drive
Fairfax, VA 22030
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Mercatus Center at George Mason University ( email )

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Arlington, VA 22201
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Rosolino Candela (Contact Author)

George Mason University - Mercatus Center ( email )

3434 Washington Blvd., 4th Floor
Arlington, VA 22201
United States

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