The German economist Gustav Friedrich von Schmoller (1838-1917) broadened the study of economics by insisting that it be studied dynamically in the context of history and sociology.
Gustav Schmoller was born on June 24, 1838, in Württemberg-Baden. He was from a family of civil servants and continued in that tradition. His studies in civic administration at the University of Tübingen included public finance, statistics, economics, administration, history, and sociology. He served as professor of civic administration at the universities of Halle (1864-1872), Strassburg (1872-1882), and Berlin (1882-1913). He was also a member of academies in Berlin, Munich, St. Petersburg, Copenhagen, Vienna, and Rome.
In the early 1860s Schmoller defended the commercial treaty between France and the German Customs Union, negotiated with Prussian leadership. This defense curtailed his career in Württemberg but gained favor for him with Prussian authorities, and he was appointed official historian of Brandenburg and Prussia in 1887. He became a member of the Prussian state council in 1884 and representative of the University of Berlin in the Prussian upper house in 1889. He died at Bad Harzburg on June 27, 1917.
Schmoller was the founder and leader of the Association of German Academic Economists. He was also editor of several publications series, one of which was later known as Schmoller's Yearbook (from 1881). One of the first great organizers of research in the social sciences, he dominated for several decades the development of economics and of related social sciences. During this time hardly a chair of economics in German universities was filled without his approval.
In political activities Schmoller was a royalist, favored strong government, and had high regard for the Prussian civil service. He was a conservative social reformer who wanted to improve working-class conditions by means of better education, government regulations, cooperatives, and other reforms.
Schmoller's contribution to economics was to reject its study in a narrow analytical view and to place it in the context of the other social sciences. Opposing a theoretical approach, he preferred to include in economics relevant aspects of history, statistics, sociology, social psychology, social anthropology, geography, and even ethics and philosophy. He was eclectic in assembling these aspects into a panorama of the social sciences. He was challenged as superficial by theoretical economist Carl Menger of Vienna in an 1883 pamphlet, by historian Georg von Below in 1904, and by others. Modern critics view Schmoller's long dominance of German social scientists as unfortunate because its effect was to retard development of economic theory in Germany. Outside Germany his influence in economics was small, although he did influence American institutional economics.
For evaluations of Schmoller's place in economics and the social sciences see Charles Gide and Charles Rist, A History of Economic Doctrines from the Time of the Physiocrats to the Present Day (trans. 1915; 2d ed. 1948); Karl Menger, Problems of Economics and Sociology, edited with an introduction by Louis Schneider (1963); and Jurgen Herbst, The German Historical School in American Scholarship: A Study in the Transfer of Culture (1965).
Balabkins, Nicholas, Not by theory alone: the economics of Gustav von Schmoller and its legacy to America, Berlin: Duncker & Humblot, 1988.