Herzl’s background

Herzl’s contribution and his place in the history of law and economics can only be understood in the light of his background and the intellectual context of his time. His work embodies much of the best of the German and Austrian approach to law and economics.

Herzl was born in Pesth, now part of Budapest, Hungary. His parents, Jacob and Jeannette Herzl, had moved there four years earlier. The family was well-to-do. Like most of the Jews of Budapest, Germany and the German language played significant roles in their lives. Herzl’s mother, particularly, was important in imbuing him with the German cultural heritage.

He had a good conventional early education. Although he was born in Budapest, his Hungarian background was overshadowed by his middle-class, orthodox and cosmopolitan education. When he was eighteen, the family moved to Vienna, where Herzl entered the university. He earned a Doctorate in Law from the Faculty of Law and Political Science (Facultat der Rechts - und Staatswissenschaften) of the University of Vienna in 1884. In common with the German universities of its time, an important function of the faculty of law was as a school for state officials. Vienna was then the capital of the Austro-Hungarian Empire, a multicultural conglomerate.

His courses often dealt with the real problems of governance. Many ele­ments of Herzl’s thought can be traced back to the cultural and intellectual milieu of the Austria of the time. Especially strong are the influences of the Habsburg monarchy and its administrative model. That Herzl had no qualms about a corporate body acting authoritatively for the good of all is shown in his discussion of the topic in the section ‘Negotiorum Gestio’ of The Jewish State.

Herzl’s background made him a humanist. His humanistic vision is dem­onstrated by the last sentence of his conclusion: ‘And whatever we attempt there to accomplish for our own welfare, will react powerfully and beneficially for the good of humanity’ (1946, p. 157). Mark E. Blum has documented the positive influence of Austrian humanism on another aspect of his work (Blum, 1996, p. 175). Austrian humanism looks for the implications of the subject matter on the human condition.

One trait of Herzl’s law and economics was based on the Austrian human­ist viewpoint about formal cause. This was his allowance for the realization of his model in the light of future uncertainties. As Blum puts it, ‘His plan is always one that has stages of development’ (ibid., p. 182). This, and his desire to avoid charges of utopianism, are the main reasons why Herzl treated many of the details of his plans with a rather lofty disdain.

From the time when he was expected to accept adult responsibilities as a Jew (Bar Mitzvah) he occupied himself increasingly with the Jewish ques­tion. Finally, he devoted his life to the cause of Zionism. His work in law and economics was predicated on his analysis of anti-Semitism. Both his legal and economic proposals had moral and ethical reasons.