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284 Economics
disciplinary research, and the eventual integration of the sciences of man is
discussed.
Part III examines developments from the point of view of the major basic
problems in economics. As already indicated, this involved a certain number of
arbitrary choices or attitudes on controversial questions that are often diversely
regarded by the different schools; the only alternative to such commitment
would have been to report monotonously on the various views, without helping
any clear picture to emerge. However, in the many discussions (initially presid-
ed over by the late Professor Oskar Lange) that preceded the actual writing of
this study, the views of other schools were always taken into account, and the
weak points of all of them (including the school to which the authors belong)
weighed against their strong points as impartially as possible. The reader will
judge how far impartiality has in fact been achieved.
While assuming full responsibility for the shortcomings, the authors would
like to express their gratitude to many scholars in Poland and other countries
for their criticism and comments and, in particular, to Professor Fritz J. de Jong
for his painstaking and extremely useful review of the first draft.
I. THE DEVELOPMENT OF ECONOMICS AND ITS PLACE AMONG THE SCIENCES OF MAN
A. Schools and trends in economics. Overcoming the crisis in economics
I. Social developments during the first decades of the twentieth century revealed
the divorce between academic economic theory and reality. Faced with grave
and urgent economic and social problems, economic theory had nothing realistic
to offer, could suggest no effective ways for improving the lot of millions of
people.
Three categories of these urgent problems will be considered here. In 1929-
1933, the worst economic crisis for centuries eloquently showed how far West
European economic theory was out of date and inadequate. General unemployment
although various forms of production capacity remained unused, and a
failure to satisfy the most elementary human needs shattered confidence in
economists, who continued to maintain that a world crisis was theoretically impossible,
or recommended ridiculously inadequate measures which sometimes
(e.g. new reductions in real wages) could even have aggravated the situation.
A further weakness of economic theory was underlined by the appearance of
a centralized economy in the Soviet Union, prepared to create and tackle new
and difficult tasks. Elsewhere, those practically involved called in vain for help
from the theoreticians, who either did not believe a rational socialist economy
possible (Brutzkus, Weber, von Mises, Hayek), or else considered that the
extraordinary simplicity of a rational socialist economy would render economic
theory of any kind superfluous (N. Bukharin).
Finally, after the second world war, a new, urgent question arose. By:then,
economic thinking had somewhat regained confidence, thanks to the full employment
theory and policy, and because managing a centralized economy had