Nietzsche, Hayek and the Marginalists…and Max Weber?

Corey Robin has just published a provocative and interesting essay in The Nation on the connection between the conservative doctrine of Nietzsche, the marginal revolution, and the Austrian school of economics. I won’t summarize the entire piece here – it is well worth taking the time to read – but merely provide some initial impressions.

Basically, Robin traces something of an “elective affinity” between Nietzsche and the 19th century economists who ushered in the marginal revolution. These figures, namely William Stanley Jevons, Carl Menger, and Leon Walras, initiated a movement in political economy that replaced the heretofore dominant labor theory of value (subscribed to by Smith, Ricardo, and Marx) with the theory of marginal utility and subjective value. According to the latter, economic value was not inscribed in an “objective” world of commodities and relations of production, but instead in the subjective value or worth that consumers were willing to place in those objects. In other words, the value of an object depended on the lengths that individuals were willing to go to acquire it (i.e. pay for it), rather than the amount of labor that went into producing it.

Despite their pronounced political differences – Nietzsche is best characterized as an aristocratic conservative, the marginalists as pro-market liberals – Robin claims that Nietzsche’s ideas make him a useful diagnostician for the rise of the idea of subjective value and, eventually, for contemporary neoliberalism (by way of Hayek).  Whereas Nietzsche set the stage by pointing to the limits of metaphysics for grounding the world and giving human life authoritative meaning, and thereby arguing for a transvaluation of the heretofore dominant values of Western civilization, the marginalists, and later “classical liberals” like Mises and Hayek, saw the free market as the only possible arbiter of value in society. Furthermore, both Nietzsche and the marginalists shared a hostility to trade unions and the burgeoning socialist movement of the 19th century, which Robin points to in arguing that implicit in the doctrine of the free market (and particularly in Hayek) is a critique of “mass society” and an aristocratic conception praising the wealthy as the avant-garde of taste and of social value.

Taken separately, Robin’s exegeses on Nietzsche and the marginalists and Hayek are excellent and insightful. But something of a disconnect remains in the link he tries to draw between them. For one, there is little evidence to suggest that Nietzsche was aware of the innovations of Menger, Jevons, or Walras, although we are told that he did critique unnamed contemporary economists for their fixation with the term “value” and, of course, understood enough about political economy to argue that the vitality of classical Athens depended on the sequestering of slave labor away from the public life of the polis. Neither is there an indication that the marginalists read Nietzsche, their contemporary (although I’m guessing Hayek almost certainly did).

Of course, Robin is not arguing that there is a direct line of influence between these thinkers. His claim is rather that Nietzsche’s insights best capture the cultural and social forces at work from which the marginalists would draw their economic conclusions. This may be perfectly true, but there is nevertheless a kind of “x degrees of separation” game being played here, in which the appeal is more to a fin de siecle European cultural Zeitgeist than of a causal connection between Nietzsche, the marginalists, Hayek, and postwar neoliberalism. My hunch is that Robin wants to claim that one can make that connection, but it does not come through here.

The term “elective affinity” of course invokes Weber and his thesis on the connection between the development of capitalism and the Protestant work ethic. Yet perhaps Weber looms here in more than just this way. If the connection between Nietzsche, the marginalists, and Hayek is not quite one of direct influence and yet can provide us with insights about postwar neoliberalism, then why not consider Weber himself, certainly one of the most “Nietzschean” thinkers of the 20th century? Despite being deeply influenced by Nietzsche in his philosophical and meta-theoretical reflections, Weber was far removed from the marginalists and the Austrian school, instead being educated in the German historical tradition of economic thought. To my knowledge, Weber never articulated the kind of anti-statist, anti-interventionist economic policies that have come to be associated with the Austrians today. If the economic legacy of Nietzsche can point in the opposite direction, by way of a thinker who read and knew Nietzsche far better than the ones Robin focuses on, then perhaps the story gets more complicated.

Finally, the idea that an individual’s worth or value depends on how he is held by others originates not with Nietzsche nor the marginalists, but much earlier with Hobbes:

“The Value, or Worth of a man, is as of all other things, his Price; that is to say, so much as would be given for the use of his Power: and therefore is not absolute; but a thing dependant on the need and judgement of another…And as in other things, so in men, not the seller, but the buyer determines the Price. For let a man (as most men do,) rate themselvesat the highest Value they can; yet their true Value is no more than it is esteemed by others.” (Leviathan, Ch. 10)

This should not be surprising, since Hobbes can certainly be thought of as a political theorist of the nascent bourgeois order (I subscribe to this view myself). But this complicates Robin’s narrative that Nietzsche and the marginalists separately developed their theories partially in response to the labor movement of the 19th century, since we see this strand of thought emerging some 200 years earlier. Perhaps Hobbes was a conservative and a reactionary in the same vein as Nietzsche and Hayek, and this recurring emphasis on the subjectivity of value is a symptom of the pathologies of conservative thought rather than having anything to do with the struggle between labor and capital? But this suggestion in turn raises a different question – how correct would we be in applying these labels to Hobbes, whose pro-monarchist views were underpinned by a fundamentally innovative political theory of authority that in the long run did more to undermine the basis for monarchy than preserve it, and who was writing over a century before the French Revolution, when the true distinction between radicalism and reaction emerged?


UPDATE: Also make sure to take a look at Robin’s post and the unfolding debate in the comments section at Crooked Timber.

7 thoughts on “Nietzsche, Hayek and the Marginalists…and Max Weber?

  1. Interesting post. Thanks for it!

    Perhaps Hobbes was a conservative and a reactionary in the same vein as Nietzsche and Hayek, and this recurring emphasis on the subjectivity of value is a symptom of the pathologies of conservative thought rather than having anything to do with the struggle between labor and capital?

    I don’t see how you segregate struggles between capital and labor and an overall view of political economy (in which value is understood one way over another). What I see in this argument is not so much the idea that value is perfectly subjective, but that economic value is the basis of all value, and that it is, in a sense, ‘automatic’: all values work like, and even stem from, market values. In this line of thinking, there is no ‘arbiter’ (or shouldn’t be, i.e. government) but the market itself. Freedom!

    I see this as a continuation of the old argument between Burke and Paine, the Enlightenment and reaction – arbitrary power vs some form of democracy. Reactionaries like Burke, and Nietzsche, and Hayek, et. al. are always, at bottom, passive and fearful. ‘Let the Market decide!’ means ‘I don’t want to make a positive judgement (only a negative one) and I don’t want you to either’.

  2. Thanks for sharing. To clarify, I was trying to hypothetically see how else to explain the similarity of Hobbes’s thoughts on value to the much later Austrian ones. I agree that there is an implicit strand in Hobbes’s theory that reflects the values of the nascent 17th century English bourgeoisie, as C.B. Macpherson argued a long time ago, although it is not reducible to saying that all value is ultimately economic in nature. But since Robin’s argument in part hinges on the idea that the marginalist conception of value was developed as a response to the labor movements of the 19th century, and since there was no comparable labor movement in Hobbes’s time, I question whether the origins of this thinking were literally a reaction to working class discontent, or date back much further and originate someplace else.

  3. Many thanks for this; extremely interesting. Over on CT I threw in the tongue-in-cheek thought that perhaps we can also identify an underlying influence of Thucydides, uniting Weber, Nietzsche and Wilhelm Roscher of the German Historical School. (The modern reception of Thucydides, I should note, is my current research focus and hence something of a King Charles’ Head). Reading this post, I start to wonder whether it is quite as silly an idea as I originally thought, particularly once one brings Hobbes – translator of Thucydides, and heavily influenced by him – into the picture. If there is any mileage in this, it isn’t so much in the field of values as in the clash between historical specificity and universal principles – key themes in the interpretation of T. (with Hobbes playing a significant role), but also the key issue in the arguments between the German historical economists and the Austrians. I’m going to have to think about this one…

  4. Pingback: Thucydides and the Marginal Revolution | Sphinx

  5. Pingback: Critics respond to “Nietzsche’s Marginal Children” | Corey Robin

  6. Pingback: Nietzsche, Hayek, and the Austrians: A Reply to My Critics | Corey Robin

  7. Pingback: Robin and the Austrians Revisited | Bleeding Heart Libertarians

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