The expression “Renaissance Man” is overused in our time. It is, however, an eminently applicable description of the German free market economist, Wilhelm Röpke.

Born 125 years ago today, in the northern German town of Schwarmstedt into a devoutly Protestant and classically liberal upper middle-class family, Röpke is remembered today as the intellectual force behind Ludwig Erhard’s liberalization of the German economy in 1948. Within ten years, this transformed a nation buried by a war of unparalleled destruction and 12 years of totalitarianism and economic dirigisme into Europe’s economic powerhouse.

But while a distinguished economic theorist who influenced economic policy during both the Weimar Republic and the postwar Federal Republic, Röpke was always more than an economist. When Röpke first came to the notice of another classical liberal economist, FA Hayek, it was because Röpke was “one of the few young German economists seriously interested in theoretical questions.” Yet as Hayek also observed in a tribute to mark Röpke’s sixtieth birthday, “Röpke realized at an early stage, perhaps earlier than most of his contemporaries, that an economist who is nothing but an economist cannot be a good economist.”

Like many fin-de-siècle middle-class Germans, Röpke received a superb education which covered subjects as different as classical languages, history, and the natural sciences. This, combined with a restless curiosity, forever inoculated Röpke against disciplinary narrowness. At university, he studied law and politics, before eventually opting for economics, receiving his doctorate in 1921. When appointed professor of economics at the University of Jena in 1924, Röpke became Germany’s youngest professor. 

Like other Germans of his age, however, Röpke had another formative experience. As a 19-year-old officer in the Kaiser’s army, Röpke fought in some of the fiercest battles on the Western front in 1918. From the mud and blood, he emerged wounded, decorated, and alive. Significantly, Röpke later remarked, the war left him wary of anything that “fostered the craving for domination and set its approval on collective immorality.”

These sentiments were reinforced by political developments in Weimar Germany. Röpke was perturbed by the country’s radical turn in the late-1920s and loudly denounced both Communists and National Socialists. He condemned the latter’s anti-Semitism and described the Nazis as an “anti-property, violent, revolutionary” party. When Hitler came to power in 1933, Röpke was forced into exile — initially in Turkey, where he served as professor of economics at the University of Istanbul, before taking a position at the Graduate Institute of International Studies in Geneva in 1937.

It was in Turkey that Röpke first turned to identifying the deeper roots of the West’s drift towards collectivism. Life in a Muslim country, he subsequently wrote, underscored to him the uniqueness of Western culture and the oversized role played by ideas in shaping it. This led Röpke to conclude that the steady embrace of economic collectivism and political centralization throughout Western countries was ultimately driven by ideas that had emerged from within the very same civilization that had given the world liberal constitutionalism, rule of law, and market economies. 

Herein lies Röpke’s most important legacy for supporters of free markets and limited government today. Röpke continued his research in areas like trade theory and business cycles. He also remained active in German and European policy debates. Nonetheless Röpke’s post-1940 writings increasingly reflected his desire to understand why so many people in Western societies put their faith in an all-encompassing state and why they embraced criminal ideologies like fascism and Marxism. Röpke concluded that unless we understand how ideas inimical to freedom had emerged in the West over time, free-market policy wins would forever be prone to subversion.

Policy victories matter. No one understood better than Röpke how abolishing price-controls and the establishment of monetary stability in 1948 had saved West Germany from economic catastrophe. Röpke’s bigger message, however, was that if free marketers didn’t identify and address the subterranean intellectual forces driving collectivist impulses, despotism would triumph.

We see this conviction at work in Röpke’s sharp critiques of the Keynesian economic revolution. According to Röpke, Keynes’s effective creation of macroeconomics and his disciples’ efforts to translate concepts like aggregate demand, aggregate employment, and aggregate capital-flows into mathematical formulae and econometrics reflected the influence of scientism — the idea that the only way to know truth is through science and the empirical method — upon intellectuals. In Röpke’s view, scientism encouraged tendencies to regard the economy “as the result of mechanical quanta subject to precise measurement and direction by an omnicompetent technical human intelligence.”

A root-and-branch defenestration of postwar Keynesian ideas and their promotion of top-down economic management policies thus involved, Röpke believed, explaining scientism’s flaws and how they had worked their way into numerous intellectual settings. That, however, implied discussion of how Western conceptions of the nature of reason had gone awry.

In books penned during and after World War II, Röpke pursued this and related questions. His conclusion was that not only had reason’s reduction to empirical inquiry by particular Enlightenment thinkers narrowed our grasp of the scope of human rationality; it had also resulted in intellectuals trying to understand everything through this lens and imagining that the same empirical reason can be employed to use state power to rearrange society and the economy from the top-down.

Röpke wasn’t the only mid-twentieth century classical liberal economist to think in these terms. As Bruce Caldwell and Hansjoerg Klausinger’s 2022 biography of Hayek illustrates, a similar outlook characterized Hayek’s thought from the late-1930s onwards. Röpke and Hayek didn’t always arrive at the same conclusions on these matters. The same operating principle, however, was at work in their thought: unless we trace, understand, and then correct some long-standing errors in the West’s intellectual trajectory, free markets will be difficult to sustain against perpetual collectivist pressures given intellectual credibility by methods and assumptions fostered by scientism.

Today it is harder to find present-day advocates of markets engaged in similar intellectual endeavors. In part, this reflects the practical imperative to resist intensifying efforts by progressives and now parts of the right to magnify interventionist policies in Western economies. But it also suggests diminished interest in free market circles in these type of political economy issues.

The good news is that Röpke’s life and work show how strategically advancing market liberal policies can go hand-in-hand with sustained attention to the type of questions that make or break civilizations which aspire to be free. Good policy work and systematic inquiry into intellectual foundations need not be mutually exclusive exercises. Röpke did not shrink from undertaking such an ambitious enterprise. Nor should we.