Nietzsche’s marginal children?

It’s not often that the work of Friedrich Nietzsche is connected to economics. I have only had the occasion to mention his name three times on this blog (here, here, and here), although Jack Amariglio and I do devote the better of a chapter of Postmodern Moments in Modern Economics, on institutionalist economics, to Nietzsche’s critique of value.

Corey Robin [ht: m] has made another important connection between Nietzsche and economics: the work of Austrian economists such as Friedrich Hayek and Ludwig von Mises. He makes his argument carefully, in the sense that he doesn’t try to establish a direct connection between Nietzsche and the Austrians. The relationship is, instead, one of “elective affinity,” which can be found (to quote from Robin’s own discussion of the article):

in the startling symmetry between Nietzschean and marginal theories of value; in the hostility to labor as the source or measure of value; in the insistence that morals be forged in a crucible of constraint; in the vision of an idle class of taste-makers creating new values and beliefs.

Robin’s argument is provocative, in the best sense of that word—it forces us to think through the relationship between economists’ treatments of value and the other ways value has been constructed and deconstructed in the modern world. In my view, there is in fact a strong affinity between Nietzsche’s “perspectivism” and the radical subjectivism one finds in Austrian treatments of value.

My only major critique of Robin’s argument (I have some minor ones but I’ll leave those aside for now) is that he doesn’t draw a sharp enough distinction between Austrian marginalists and mainstream neoclassical marginalists. That’s important because, while Austrian marginalists may be on the ascendance in recent years (connected, in turn, to the rise of the libertarian Right), they are still mostly outcasts within mainstream economics, which is dominated by neoclassical marginalism.

And the difference? Neoclassical marginalism is founded on the idea of utility-maximizing consumers (along with profit-maximizing producers), leading to equilibrium within and across markets and an efficient allocation of scarce resources for society as a whole. Austrian marginalists, on the other hand, reject the idea that anyone can have the knowledge to make such society-wide calculations. Instead of efficiency, the Austrians focus on the freedom of individuals (especially entrepreneurs) to make decisions based on their local plans and limited knowledges. To put it in a nutshell, while both groups celebrate capitalism, they do so for different reasons: efficiency versus freedom.

My point is simple: not all contemporary marginalism should be considered Nietzsche’s children. Perhaps the Austrians but certainly not the neoclassicals who dominate the discussion of economic theory and policy within mainstream economics and who remain wedded to the kinds of humanism, positivism, and scientism that Nietzsche himself would have found to be the expressions of a slave morality.