Carl Menger
Carl Menger von Wolfensgrün[2] (/ˈmɛŋɡər/; German: [ˈmɛŋɐ]; 28 February 1840[3] – 26 February 1921) was an Austrian economist and the founder of the Austrian School of economics. Menger contributed to the development of the theories of marginalism and marginal utility,[4] which rejected cost-of-production theory of value, such as developed by the classical economists such as Adam Smith and David Ricardo. As a departure from such, he would go on to call his resultant perspective, the subjective theory of value.[5]
This article is about the economist. For his son, the mathematician, see Karl Menger.
Carl Menger von Wolfensgrün
28 February 1840
Austrian
Economics
Biography[edit]
Family and education[edit]
Carl Menger von Wolfensgrün[2] was born in the city of Neu-Sandez in Galicia, Austrian Empire, which is now Nowy Sącz in Poland. He was the son of a wealthy family of minor nobility; his father, Anton Menger, was a lawyer. His mother, Caroline Gerżabek, was the daughter of a wealthy Bohemian merchant. He had two brothers, Anton and Max, both prominent as lawyers. His son, Karl Menger, was a mathematician who taught for many years at Illinois Institute of Technology.[6]
After attending gymnasium he studied law at the Universities of Prague and Vienna and later received a doctorate in jurisprudence from the Jagiellonian University in Kraków. In the 1860s Menger left school and enjoyed a stint as a journalist reporting and analyzing market news, first at the Lemberger Zeitung in Lemberg, Austrian Galicia (now Lviv, Ukraine) and later at the Wiener Zeitung in Vienna.[7]
Career[edit]
During the course of his newspaper work, he noticed a discrepancy between what the classical economics he was taught in school said about price determination and what real world market participants believed. In 1867 Menger began a study of political economy which culminated in 1871 with the publication of his Principles of Economics (Grundsätze der Volkswirtschaftslehre), thus becoming the father of the Austrian School of economic thought.[8] It was in this work that he challenged classical cost-based theories of value with his theory of marginality – that price is determined at the margin.
In 1872 Menger was enrolled into the law faculty at the University of Vienna and spent the next several years teaching finance and political economy both in seminars and lectures to a growing number of students. In 1873, he received the university's chair of economic theory at the very young age of 33.
In 1876 Menger began tutoring Archduke Rudolf von Habsburg, the Crown Prince of Austria in political economy and statistics. For two years, Menger accompanied the prince during his travels, first through continental Europe and then later through the British Isles.[9] He is also thought to have assisted the crown prince in the composition of a pamphlet, published anonymously in 1878, which was highly critical of the higher Austrian aristocracy. His association with the prince would last until Rudolf's suicide in 1889.
In 1878 Rudolf's father, Emperor Franz Joseph, appointed Menger to the chair of political economy at Vienna. The title of Hofrat was conferred on him, and he was appointed to the Austrian Herrenhaus in 1900.