Frank Knight

Frank Hyneman Knight was born in McLean County, Illinois, and was educated at small denominational colleges in Tennessee ... Knight's interest in developing an American institutionalist economics was the primary motive behind his appointment as professor of economics at the University of Chicago in 1927, where he taught until his retirement in 1952. Along with his colleague, Jacob Viner, Knight is regarded as one of the formative influences on the Chicago School of Economics. Among Knight's students ... were Milton Friedman, George Stigler, Henry Simons, Aaron Director, and ... James Buchanan.

Robbins arranged to reprint the work of a number of economists ... He assigned Risk, Uncertainty and Profit, by the University of Chicago's Frank H. Knight ... Machlup showed the page proofs [of The Road to Serfdom] to Aaron Director, Milton Friedman's brother-in-law. Presumably it was Director who sent the page proofs to Frank Knight, the most influential thinker in the University of Chicago's economics department. Knight, in turn, seems to have urged the book on William Couch, editor of the University of Chicago Press, and the decision was made to publish it.

A Kuhnian story is more powerful if one can identify a unique revolutionary spark. For Machovec it was one book: Frank Knight's Risk, Uncertainty and Profit ([1921] 1971). He sees Knight as 'the leading expositor of the perfectly competitive model' (p. 265). But Knight’s role as 'leading expositor' has been controversial, most recently on the Austrian economics Internet discussion group, and I shall not try to resolve it here. Knight, the classic 'puzzler' (Hayek 1978), is often delightful (Knight 1956) but was on the wrong end of the capital controversy with Hayek.

A self-described libertarian socialist ... Buchanan was "converted" ... after six-weeks of price theory with Frank Knight. The libertarian values remained, but now Buchanan understood through Knight that the market (not government) was the organizational form most consistent with those values. Knight became for Buchanan his intellectual role model—challenge everything and anyone, nothing should be treated as sacred, and recognize that most ideas peddled about are nonsense ... From Knight, Buchanan got ... the idea that economics is not a science in the traditional meaning of that term.

Reason: Do you have a clear memory of how your political philosophy formed? Was it any specific teacher ...?
Friedman: ... I was exposed as an undergraduate at Rutgers to two very strong influences: Homer Jones, who was a student of Frank Knight's from Chicago, and Arthur Burns ... Thanks to Homer, I was offered a scholarship at the University of Chicago and I went [there] and studied with Frank Knight, Jacob Viner, Henry Schultz, and so on. The atmosphere in Chicago in 1932 was very lively and active and encouraging ... I got a very good grounding in economic theory and statistics as well.