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My thanks to Avi for providing such a great survey of the Boulding - Knight
relationship regarding capital theory. And to Pete for the personal story of
asking Boulding about it.
I don't have a great deal to add, but there are a few things.
1) As Avi's contribution makes clear, Boulding was not quite correct in telling
Pete that Knight published his response to Boulding's work before Boulding
even published an article. Both of Boulding's articles appear before Knight's
"The Theory of Investment Once More: Mr. Boulding and the Austrians." But
he may have been right that Knight's criticism launched his career!
2) But the story begins even earlier. The first correspondence in the Knight
papers between the two is a letter from FHK to KB on 5 December 1933.
Knight outlines what he would like to see done with Keynes' ideas on capital
theory, and asks Boulding if he would like to tackle that as his research topic.
Seven days later, on 12 December, Knight sent Boulding his newly-released
essay "Capitalistic Production, Time and the Rate of Return" (In _Economic
Essays in Honour of Gustav Cassel_. London: George Allen & Unwin, 1933,
pp. 327-42), along with some additional notes regarding capital theory. This
article launched Knight's attack on Austrian capital theory. Ten days later, in
another letter (22 December), Knight asks Boulding if he would be interested
in tackling a topic in capital theory. There is no additional correspondence
between the two preserved in the Knight papers from this time period. I
presume, then, that Boulding came to work with Knight already prepared to
discuss capital theory.
3) There is a preliminary draft of the "The Theory of Investment Once More"
piece in the Knight papers (Box 1 Folder 8-9). It is not significantly different
from the published version. Like some of the other capital controversy
pieces, this one was written quickly and is not laboured over (many of
Knight's later writings have as many as nine drafts, with several redirections
and offshoots).
4) Avi's reference list does not include "Versus Boulding" (February 1936,
Knight Papers, Box 39 Folder 16, 3 pp.). This is an unpublished sketch of
Knight's disagreement with Boulding, written as a rejoinder to Boulding's
"Professor Knight's Capital Theory: A Note in Reply."
I have found no other material related to the Knight-Boulding disagreement. It
doesn't seem to have soured their relationship, although they do not
correspond again until much later in life. And they disagreed again in the
1950s -- this time on institutionalism (see "A New Look at Institutionalism,"
by Kenneth E. Boulding, in AER 47 (May Supplement): 1-12. and Knight's
discussion of it in "Institutional Economics," AER 47 (May Supplement): 18-
21. Both of these are reprinted, I believe, in Institutional Economics, edited by
Warren J. Samuels (Aldershot, U.K.: Edward Elgar, 1988).
My own Boulding story: In January 1987 I attended the AEA meetings in
NYC. I was standing at the registration booth, when I noticed Boulding
standing talking to (of all people) Robert Lucas. Just then, the woman staffing
the registration booth asked me: "Who's that distinguished-looking gentleman
over there with the beautiful long hair?" I proudly told her it was Boulding, a
renown economist. With that, she leaned over the counter, yelling and waving
to attract Boulding's attention! Once she got it (and everyone else's!), she
immediately proceeded to ask him: "Can you help me? I have to decide
whether to lock in my mortgage or not, and wonder if interest rates are going
to go up or down?" Everyone in the room started laughing, and Boulding
looked a bit surprised. Bob Lucas, of course, volunteered to field the
question!
Ross
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