Bauer, Otto (1881–1938)

Abstract

Born 5 September 1881, Vienna; died 4 July 1938, Paris. A member of a talented Jewish family and the only son of a textile manufacturer, Bauer became interested in Marxism and the ‘revisionist’ controversy while still in high school, and went on to study philosophy, law and political economy at the University of Vienna. He became the leader of the Austrian socialist party (SPÖ) and a prolific writer on economic and political questions. Bauer is best known for his study of nationalities and nationalism (1907), which remains the classic Marxist work on the subject, but he also wrote extensively on economics and his first major essay (1904), which brought him to the notice of Karl Kautsky, discussed the Marxist theory of economic crises. In his early writings he adopted a ‘disproportionality’ theory such as Hilferding expounded more fully in Finance Capital (1910); that is, a theory which sees the fundamental causes of crises in the ‘anarchy of capitalist production’, and particularly in the disproportion which regularly emerges between production in the two sectors of capital goods and consumer goods. However, in his last published book (1936) he propounded an underconsumption theory of crises which subsequently influenced the work of Sweezy. In the course of his analyses of economic crises Bauer introduced, or emphasized more strongly than other Marxist writers, such factors as the existing stock of capital, technical progress, and population growth.

This chapter was originally published in The New Palgrave: A Dictionary of Economics, 1st edition, 1987. Edited by John Eatwell, Murray Milgate and Peter Newman