Why Did the GHSE Attract American Students and Scholars?

In the 19th century, American society was becoming more industrialized and urbanized. There was also a growing interest in economic problems, as young American men were worried about the destructive outcomes associ­ated with the industrialization process, which motivated them to try to find ways ‘to avoid the ills that disfigured England’s factory and machine age and threatened the Anglo-American tradition of liberty’ (Dorfman 1955, 17).

American Political Economists and the Influence of the GHSE 87 fact, the destructive outcomes of industrialization observed in England led them to lose faith in the ability of classical economics to provide the appro­priate policies and reforms needed to successfully offset similar results in the US. That also means critics of classical economics were already present in the US prior to the arrival of significant numbers of Americans who went to Germany to advance their education and training under the theorists of the GHSE.

There were a number of factors that made Germany the exclusive destina­tion of choice for American students and academics seeking to further their education and training abroad. While the German reputation for providing great hospitality played a role in this phenomenon, the most important reason was the prominent status of German undergraduate and graduate programs when it came to providing an advanced level of education due, in large part, to the unparalleled international reputation of the theorists of the GHSE (Devine 1894, 87). At that time, it was accepted that Germany was the only country in which ‘systematic academic training in political economy had begun’ (Mason and Lamont 1982, 391). However, even before the GHSE achieved international prominence, Americans were paying close attention to the social and economic changes that were transpiring across the Atlantic by following European newspapers, journals, books, and periodicals.

Like many of their international peers, Americans were interested in getting a higher education in Germany instead of France or England due to the per­ception that ‘no other country’ was ‘so interesting to the political economist as Germany’ (Ely 1882, 519). At that time, the work of theorists of the GHSE represented the rise of ‘a new creative power’ in political economy (Ely 1883, 233). It was even claimed that the discipline of political economy obtained its ‘truly scientific basis’ from this new movement, which was initiated through the works of Wilhelm Georg Friedrich Roscher (1817-1894), Bruno Hilde­brand (1812-1878), and Karl Knies (1821-1898) (Seligman 1886A, 18). There was also a great deal of appreciation for ‘the amount of actual knowledge, historical and theoretical, imparted’ by Gustav von Schmoller (1838-1917), Lujo Brentano (1844-1931), Adolf Held (1844-1880), Adolf Gotthilf Wagner (1835-1917), Johannes Conrad (1839-1915), and many other theorists of the GHSE (Seligman 1886A, 19).

The contributions of the GHSE to the ‘positive knowledge of the economic institutions and customs of the different parts of the world’ was striking (Ely 1883, 234). Its theorists essentially introduced ‘a new spirit and purpose’ into political economy, and many American men were delighted with this funda­mental alteration to the spirit of the discipline (ibid.). The GHSE was clearly experiencing unprecedented success, as evidenced by the fact that ‘an ever increasing number of college graduates were going to Germany for advanced work’ (Dorfman 1955, 22). Living and studying in Germany demonstrated

‘the importance of linking book knowledge and practical experience’ for young American students and academics (Ely 1938, 187). In fact, unlike the classical economics of England, which had its influence ‘communicated by the importation and the republication of books,’ the influence of the GHSE was largely transmitted through personal networks and interactions (Devine 1894, 87).

Since American students and academics were interested in acquiring ad­vanced knowledge in the area of political economy, including the methods and techniques developed by the theorists of the GHSE, they were being ‘constantly drawn to Germany,’ where they could enroll in classes on his­torical and statistical investigation (Ely 1882, 519). They relied heavily on the work of Roscher in order to acquire ‘information about early phases of German economic thought’ (Small 2001, 5—6). His work was particularly influential in the development of American economics between 1865 and 1914 (Senn 1995, 60). During this period, three of his books were translated into English and widely used as textbooks at universities: Outline of Lectures on Political Science According to the Historical Method; Principles of Political Economy; and The Spanish Colonial System. In fact, Roscher was ‘admired’ by many ‘on account of his reverence for his predecessors’ (Seligman 1889, 545). His as­tonishing ‘historic learning enabled him to explain much that had been dark’ (Seligman 1889, 545).

In addition to Roscher, Schmoller, ‘the master historian and statistician,’ was highly revered by many German-trained American political econo­mists, though his influence ‘was at its peak’ between 1870 and 1910 (Seager 1893, 249). It was mainly those American students with an interest in ethi­cal economics and ‘historical and statistical researches’ that chose to attend Schmoller’s classes (ibid.: 241). These students had a particularly high opinion of his teachings, views, knowledge, and writing (Seager 1893). However, it has been claimed that his ‘importance and influence’ in the development of the GHSE could not be ‘appreciated by one who has never heard him lecture’ (ibid.: 251).

American Political Economists and the Influence of the GHSE 89 great task set for himself by a man of great gifts, and worthily accomplished’ (Taussig 1905, 501).

American students who were interested in socialism, money and banking, public finance, and practical political economy often chose to study in Wag­ner’s classes (Seager 1893, 241). To be more precise, his courses on money and banking mainly focused on ‘the history, nature and function of moneys, the history and statistics of the production of the precious metals,’ etc. (ibid.: 245). Meanwhile, his courses on practical political economy concentrated on ‘agriculture, manufacturing industry, trade and transportation, laying down general rules to guide the action of the state in its relation to these industries’ (ibid.: 244). During his lectures, Wagner would provide ‘a wealth of striking illustrations and interesting facts borrowed from the economic histories of all countries’ (ibid.: 243). Consequently, much like many of his contemporaries at the GHSE, Wagner’s classes were ‘crowded with students from all over the world. Russians, Poles, Bulgarians, Italians, English, Japanese and Americans flocked to hear him’ (Simkhovitch 1938, 51). Meanwhile, Conrad’s classes mainly focused on the economics and statistics of the modern agriculture sec­tor. His lectures and seminars also attracted and ‘stimulated a large number of distinguished students, many of whom were Americans’ (Ely 1938, 40). Students from the US also had high praise for Knies, because his classes on statistics and money at University of Heidelberg gave ‘the historical method a scientific standing’ (Clark 1886, 35). Americans also studied under many other prominent contributors of the GHSE. In fact, between 1870 and 1890, of the 76 American economists at 28 leading colleges and universities across the US, ‘53 studied in Germany’ and attended the classes and lectures of these prominent political economists that adhered to the GHSE (Parrish 1967, 5).