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Friedrich A. Lutz’ Epistemological and Methodological Messages During the German-Language Business Cycle Debate

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Grudev, L. Friedrich A. Lutz’ Epistemological and Methodological Messages During the German-Language Business Cycle Debate. Journal of Contextual Economics – Schmollers Jahrbuch, 139(1), 1-28. https://doi.org/10.3790/schm.139.1.1
Grudev, Lachezar "Friedrich A. Lutz’ Epistemological and Methodological Messages During the German-Language Business Cycle Debate" Journal of Contextual Economics – Schmollers Jahrbuch 139.1, , 1-28. https://doi.org/10.3790/schm.139.1.1
Grudev, Lachezar: Friedrich A. Lutz’ Epistemological and Methodological Messages During the German-Language Business Cycle Debate, in: Journal of Contextual Economics – Schmollers Jahrbuch, vol. 139, iss. 1, 1-28, [online] https://doi.org/10.3790/schm.139.1.1
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Friedrich A. Lutz’ Epistemological and Methodological Messages During the German-Language Business Cycle Debate

Grudev, Lachezar

Journal of Contextual Economics – Schmollers Jahrbuch, Vol. 139 (2019), Iss. 1 : pp. 1–28

4 Citations (CrossRef)

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Article Details

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Duncker & Humblot
DOI
https://doi.org/10.3790/schm.139.1.1
Language
English
Pages
27
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Author Details

Grudes, Lachezar, Institute for Economic Research, Chair of Economic Theory, University of Freiburg, Platz der Alten Synagoge, 79085 Freiburg, Germany.

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Abstract

Friedrich A. Lutz’ 1932 habilitation thesis is considered the last highlight in a German-language business cycle debate that took place during the interwar period. This debate, initiated by Adolf Löwe, concentrated on the necessary conditions in defining a dynamic theory that should explain the business cycle understood as a dynamic disequilibrium phenomenon in a deductive way. This article contributes to Lutz scholarship by focusing on Lutz’ criticism of Clément Juglar’s “unconditional” observations. This constituted the basis for the problematic concept of wave-like fluctuation subsequently adopted by the Historical School and Joseph Schumpeter. I establish a relationship between Lutz’ criticism and his statement that this perspective does not find support in economic history. Lutz asserted that each crisis represents a unique historical phenomenon caused by specific factors whose impact on the economy depends on its institutional framework. From this, I derive an epistemological claim, namely that the equilibrium tendencies within the market order should be the subject of inquiry, and a methodological call, namely the development of models showing hypothetically what factors can disturb these tendencies. The paper contextualizes Lutz’ criticism and messages into the formation of the Freiburg School’s research program.

Table of Contents

Section Title Page Action Price
Lachezar Grudev: Friedrich A. Lutz’ Epistemological and Methodological Messages During the German-Language Business Cycle Debate 1
Abstract 1
1. Introduction 1
2. Aspects of the German-Language Business Cycle Debate 3
2.1 Joseph Schumpeter’s Relevancefor German-Speaking Economists 3
2.2 Adolf Löwe – Friedrich A. HayekMethodological Discussions 5
3. Friedrich A. Lutz’ Contribution to the Debate 7
3.1 Friedrich A. Lutz and the Formationof the Freiburg School of Economics 7
3.2 Friedrich A. Lutz’ Response to the Debate 9
3.2.1 The Subject of Inquiry Itself is Problematicin Business Cycle Research 1
3.2.2 The Problematic Subject of Inquiry –the Basis for Problematic Theories 1
4. Friedrich A. Lutz’ Epistemologicaland Methodological Messages 1
4.1 The Epistemological Message – On the Subject of Inquiry 1
4.2 The Methodological Message 1
4.2.1 The Pure Theoretical Approach –The Construction of Models 1
4.2.2 The Statistical Approach –A Concrete Explanation of Historical Events 1
5. Did Friedrich A. Lutz Win the Day? 1
6. Conclusion 2
References 2

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