View source for Frank Knight

{{Short description|American economist (1885–1972)}}
{{other people}}
{{Infobox economist
| school_tradition = [[Chicago School of Economics]]
| image       = Frank H Knight.jpg
| image_size       =
| caption    =
|birth_name        = Frank Hyneman Knight
| birth_date       = {{Birth date|1885|11|7|df=y}}
| birth_place      = [[McLean County, Illinois]], U.S.
| death_date       = {{Death date and age|1972|4|15|1885|11|7|df=y}}
| death_place      = [[Chicago, Illinois]], U.S.
| nationality      =
| father           = Winton Knight
| mother           =  Julia Hyneman
|spouse = Ethel Verry Knight 
|relatives         = [[Melvin Moses Knight]] (brother) <br> Bruce Winton Knight (brother)
Horace Knight (son from 1st marriage)
Laura (daughter from 1st marriage)
Susan Gladys Knight (daughter from first marriage)
Alice Knight (daughter from first marriage)
| institution      = [[Cornell University]]<br>[[University of Chicago]]<br>[[University of Iowa]]
| field            = Risk theory<br>[[Profit (economics)|Profit theory]]<br>[[Value theory]]
| alma_mater       = [[Milligan College]]<br>[[University of Tennessee]]<br>[[Cornell University]]
| doctoral_advisor  = [[Allyn A. Young]]<br>[[Alvin S. Johnson]]
| academic_advisors =
| doctoral_students = [[Milton Friedman]]<br>[[George Stigler]]<br>[[Charles E. Lindblom]]<br>[[James M. Buchanan]]
| notable_students  =
| influences       = [[Clarence Edwin Ayres]]<br>[[John Bates Clark]]<br>[[Herbert J. Davenport]]<br>[[Max Weber]]
| contributions    = [[Knightian uncertainty]]
| awards           = [http://www.aeaweb.org/honors_awards/walker_medal.php Francis A. Walker Medal] (1957)
| signature        = <!-- file name only -->
| repec_prefix =   | repec_id =
}}
'''Frank Hyneman Knight''' (November 7, 1885 – April 15, 1972) was an American [[economist]] who spent most of his career at the [[University of Chicago]], where he became one of the founders of the [[Chicago School (economics)|Chicago School]].

Nobel laureates [[Milton Friedman]], [[George Stigler]] and [[James M. Buchanan]] were all students of Knight at Chicago. [[Ronald Coase]] said that Knight, without teaching him, was a major influence on his thinking.<ref>{{cite book|author=Ross B. Emmett|title=The Elgar Companion to The Chicago School of Economics|url=https://books.google.com/books?id=MaCciKWcDIAC&pg=PA238|year=2010|publisher=Elgar |page=238|isbn=978-1849806664}}</ref> [[Friedrich Hayek|F.A. Hayek]] considered Knight to be one of the major figures in preserving and promoting [[Classical liberalism|classical liberal]] thought in the twentieth century.<ref>{{cite journal|last1=Hayek|first1=Friedrich A.|title=The Transmission of the Ideals of Freedom|journal=Econ Journal Watch|date=2012|volume=9|issue=2|pages=163–169|url=https://econjwatch.org/articles/the-transmission-of-the-ideals-of-economic-freedom?ref=articles}}</ref><ref>{{cite book |last= Hayek |first= F.A. |author-link= F. A. Hayek |chapter= The Transmission of the Ideals of Economic Freedom |title= Studies in Philosophy, Politics and Economics |place= London |publisher= Routledge & Kegan Paul |year=1967 |url= https://archive.org/details/studiesinphiloso0000haye_o2x8/page/n5/mode/2up?view=theater |url-access= registration |page= [https://archive.org/details/studiesinphiloso0000haye_o2x8/page/198/mode/2up?view=theater 198] |via= [[Internet Archive]]}}</ref>

[[Paul Samuelson]] named Knight (along with [[Harry Gunnison Brown]], [[Allyn Abbott Young]], [[Henry Ludwell Moore]], [[Wesley Clair Mitchell]], [[Jacob Viner]], and [[Henry Schultz]]) as one of the several "American saints in [[economics]]" born after 1860.<ref>{{cite web |last1=Ryan |first1=Christopher Keith |title=Harry Gunnison Brown: economist |url=https://lib.dr.iastate.edu/cgi/viewcontent.cgi?article=13098&context=rtd |publisher=Iowa State University |date=1985 |access-date=7 January 2019}}</ref>

{{Chicago School (economics)}}

==Life and career==
Knight ([[Bachelor of Arts|BA]], Milligan College, 1911; [[Bachelor of Science|BS]] and [[Master of Arts|AM]], Tennessee, 1913; [[PhD]], Cornell, 1916) was born in 1885 in [[McLean County, Illinois]], the son of Julia Ann (Hyneman) and Winton Cyrus
Knight.<ref>{{Cite web |url=http://www.chicagobooth.edu/assests/stigler/37.pdf |title=Archived copy |access-date=2019-12-20 |archive-url=https://web.archive.org/web/20150923202722/http://www.chicagobooth.edu/assests/stigler/37.pdf |archive-date=2015-09-23 |url-status=dead }}</ref> After his early study at the [[University of Tennessee]], most of his academic career was spent at the [[University of Chicago]], where he was the Morton D. Hall Distinguished Service Professor of Social Science and Philosophy. Knight was one of the world's leading economists, having made significant contributions to many problems of both economic theory and social philosophy. He is best known for his ''Risk, Uncertainty and Profit'', a study of the role of the entrepreneur in economic life.<ref>{{Cite journal|last=Bylund|first=Per L.|date=2021|title=Introduction to the special issue on the Centenary of Frank H. Knight's Risk, Uncertainty, and Profit|journal=Journal of Institutional Economics|volume=17|issue=6|pages=877–881|language=en|doi=10.1017/S1744137421000564|issn=1744-1374|doi-access=free}}</ref> In 1950 he was president of the [[American Economic Association]] and in 1957 the recipient of its coveted Francis A. Walker Award, given "not more frequently than once every five years to the living (American) economist who in the judgment of the awarding body has during his career made the greatest contribution to economics." His ashes are interred in the crypt of [[First Unitarian Church of Chicago]].

Knight is best known as the author of the book ''Risk, Uncertainty and Profit'' (1921), based on his [[PhD dissertation]] at [[Cornell University]]. In that book, he carefully distinguished between economic risk and [[Knightian uncertainty|uncertainty]]. Situations with risk were those where the outcomes were unknown but governed by [[probability distribution]]s known at the outset. He argued that these situations, where decision making rules such as maximising expected utility can be applied, differ in a deep way from "uncertain" ones, in which not only the outcomes, but even the probability models that governed them, were unknown. Knight argued that uncertainty gave rise to [[economic profit]]s that [[perfect competition]] could not eliminate.

While most economists now acknowledge Knight's distinction between risk and uncertainty, the distinction has not resulted in much theoretical modelling or empirical work. However, the Knightian concept of uncertainty has been recognized in a variety of works: [[John Maynard Keynes]] discussed it at length in his Treatise on Probability;
<ref>{{cite book |last1=Keynes |first1=John Maynard |title=[[A Treatise on Probability]] |date=1921 |publisher=Macmillan |location=London}}</ref>
Armen Alchian relied on it for discussing market behavior in his seminal paper Uncertainty, Evolution and Economic Theory; Paul Davidson incorporated it as an essential element in the
[[Post-Keynesian economics|Post Keynesian]] school of economics he co-founded; and [[G.L.S. Shackle]] explored the methodological consequences of Knight's and Keynes's fundamental uncertainty in his Epistemics and Economics. A more model-oriented contribution is the "Markets from Networks" model developed by [[sociologist]] [[Harrison White]] from 2002.

Knight also famously debated [[A. C. Pigou]] about [[social cost]]s. He also contributed to the argument for [[toll road]]s. He said that rather than congestion justifying government tolling of roads, privately owned roads would set tolls to reduce congestion to its efficient level. In particular, he developed the argument that forms the basis of analysis of traffic equilibrium, which has since become known as [[Wardrop's Principle]]:

{{blockquote|Suppose that between two points there are two highways, one of which is broad enough to accommodate without crowding all the traffic which may care to use it, but is poorly graded and surfaced; while the other is a much better road, but narrow and quite limited in capacity. If a large number of trucks operate between the two termini and are free to choose either of the two routes, they will tend to distribute themselves between the roads in such proportions that the cost per unit of transportation, or effective returns per unit of investment, will be the same for every truck on both routes. As more trucks use the narrower and better road, congestion develops, until at a certain point it becomes equally profitable to use the broader but poorer highway.}}

Knight was a co-founder and vice president of the [[Mont Pelerin Society]] of like-minded economists.<ref>{{cite book|author=Alan Ebenstein|title=Friedrich Hayek: A Biography|url=https://books.google.com/books?id=IP_dBAAAQBAJ&pg=PA146|year=2014|page=146|publisher=St. Martin's Publishing |isbn=978-1466886766}}</ref>

Knight was raised Christian, but later became an atheist.<ref>Lanny Ebenstein (2007). Milton Friedman: A Biography. Palgrave Macmillan. p. 21. {{ISBN|978-0230603455}}. Frank Knight was the other leading member in the department when Friedman was a graduate student. Born in 1885, Knight hailed from a rural Christian background but early became an atheist.</ref>

He translated [[Max Weber]]'s ''[[General Economic History]]'' into English in 1927.<ref>{{Cite encyclopedia |year=2016 |title=The Max Weber Dictionary: Key Words and Central Concepts |publisher=Stanford University Press |url=https://books.google.com/books?id=_c3Mcnh8hCgC |edition=2nd |pages=96–97 |doi=10.1515/9781503600225 |isbn=978-1503600225 |oclc=956984918 |last2=Agevall |first2=Ola |last1=Swedberg |first1=Richard|url-access=subscription }}</ref>

==Notable works==
<!-- * "The Concept of Normal Price in Value and Distribution", 1917, ''QJE''.
* "Cassel's Theoretische Sozialökonomie", 1921, ''JPE''.-->
* {{cite book |title = Risk, Uncertainty, and Profit |url= https://archive.org/details/cu31924032612693/page/n9/mode/2up |via = [[Internet Archive]] |accessdate= 7 October 2023|year= 1921 |place = Boston and New York |publisher = Houghton, Mifflin Company}}<ref name=Boyd>{{cite encyclopedia |last=Boyd |first=Robert |editor-first=Ronald |editor-last=Hamowy |editor-link=Ronald Hamowy |encyclopedia=The Encyclopedia of Libertarianism |url= https://books.google.com/books?id=yxNgXs3TkJYC  |year=2008 |publisher= [[SAGE Publishing|Sage]]; [[Cato Institute]] |location= Thousand Oaks, CA |doi= 10.4135/9781412965811.n164 |isbn= 978-1412965804 |oclc=750831024| lccn = 2008009151 |pages=274–275 |chapter=Knight, Frank H. (1885–1972) |url-access=subscription }}</ref><!--* "Ethics and the Economic Interpretation", 1922, ''QJE'' (repr. in 1999, I)
* "The Ethics of Competition", 1923, ''QJE'' (repr. in 1999, I)
* "[https://books.google.com/books?id=FQ0zqzbhbMgC&pg=PA49 Business Management: Science or Art?]", 1923 ''Journal of Business''.
* "Some Fallacies in the Interpretation of Social Cost", 1924, ''QJE'' (repr. in 1999, I)
* "The Limitations of Scientific Method in Economics", 1924, in Tugwell, editor, ''Trend of Economics'' (repr. in 1999, I)
* "Fact and Metaphysics in Economic Psychology", 1925, ''AER'' (repr. in 1999, I)
* "A Note on Professor Clark's Illustration of Marginal Productivity", 1925, ''JPE''.
* "Economic Psychology and the Value Problem", 1925, ''QJE''.
* "Economics at its Best: Review of Pigou", 1926, ''AER''.
* "Historical and Theoretical Issues in the Problem of Modern Capitalism", 1928, ''Journal of Econ & Business History'' (repr. in 1956 & 1999, I)
* "A Suggestion for Simplifying the Statement of the General Theory of Price", 1928, ''JPE''.
* "Freedom as Fact and Criterion", 1929, ''Int J of Ethics''
* "Statics and Dynamics: Some queries regarding the mechanical analogy in economics", 1930, ''ZfN'' (repr. in 1956 & 1999, I)
* "Professor Fisher's Interest Theory: A case in point", 1931, ''JPE''.
* "Modern Economic Society Further Considered", 1932, ''JPE''.
* "The Newer Economics and the Control of Economic Activity", 1932, ''JPE'' (repr. in 1999, I)-->
* {{cite book |title= The Economic Organization |place= New Brunswick (US) and London (UK)|publisher= Transaction Publishers |url=https://archive.org/details/economicorganiza0000knig_k4c3/page/n3/mode/2up?view=theater |url-access= registration |year= 2013|isbn= 978-1412851787}}<ref name=Boyd/><!--* "Capitalistic Production, Time and the Rate of Return", 1933, in ''Essays in Honor of Gustav Cassel'' (repr. in 1999, I)
* "The Nature of Economic Science in Some Recent Discussion", 1934, ''AER''.
* "Social Science and the Political Trend", 1934, ''Univ of Toronto Quarterly''
* "Common-Sense of Political Economy: Wicksteed Reprinted", 1934, ''JPE'' (repr. in 1956)-->
* {{cite book |title= The Dilemma of Liberalism
|first= Frank H.|last=  Knight |place= Ann Arbor, MI |publisher= Photo-lithoprint reproduction of author's manuscript by Edwards Brothers |year= 1933 |url= https://catalog.hathitrust.org/Record/001349867|via= [[HathiTrust]]}}
* {{cite book |title= The Ethics of Competition and Other Essays |url= https://archive.org/details/ethicsofcompetit0000unse/page/n7/mode/2up?view=theater |url-access= registration |year= 1935 |place= London |publisher= George Allen and Unwin Ltd.}}<ref name=Boyd />
<!--* "The Ricardian Theory of Production and Distribution", 1935, ''Canadian JE'' (repr. in 1956 & 1999)
* "A Comment on Machlup", 1935, ''JPE''.
* "Professor Hayek and the Theory of Investment", 1935, ''EJ''.
* "The Theory of Investment Once More: Mr. Boulding and the Austrians", 1935, ''QJE''.
* "Some Issues in the Economics of Stationary States", 1936, ''AER''.
* "The Place of Marginal Economics in a Collectivist System", 1936, ''AER''.
* "The Quantity of Capital and the Rate of Interest", 1936, ''JPE'' (repr. in 1999, I)
* "Pragmatism and Social Action: Review of Dewey", 1936, ''Int J of Ethics''
* "Note on Dr. Lange's Interest Theory", 1937, ''RES''.
* "Unemployment: and Mr. Keynes's revolution in economic theory", 1937, ''Canadian JE'' (repr. in 1999, I)
* "On the Theory of Capital: In reply to Mr. Kaldor", 1938, ''Econometrica''.
* "Bertrand Russell on Power", 1939, ''Ethics''.
* "The Ethics of Liberalism", 1939, ''Economica''.
* "Socialism: The Nature of the Problem", 1940, ''Ethics'' (repr. in 1999, II)
* "'What is Truth' in Economics", 1940, ''JPE'' (repr. in 1956 & 1999, I)
* "The Significance and Basic Postulates of Economics: a rejoinder", 1941, ''JPE''
* "Religion and Ethics in Modern Civilization", 1941, ''J of Liberal Religion''
* "The Meaning of Democracy: its politico-economic structure and ideals", 1941, ''J of Negro Education''
* "Social Science", 1941, ''Ethics'' (repr. in 1956)
* "The Business Cycle, Interest and Money: A methodological approach", 1941, ''REStat'' (repr. in 1956 & 1999, II)
* "Professor Mises and the Theory of Capital", 1941, ''Economica''.
* "The Role of the Individual in the Economic World of the Future", 1941, ''JPE''.
* [https://www.jstor.org/stable/1824430 "Anthropology and Economics"], 1941, ''JPE''.
* "Science, Philosophy and Social Procedure", 1942, ''Ethics''
* "Fact and Value in Social Science", 1942, in Anshen, editor, ''Science and Man''
* "Some Notes on the Economic Interpretation of History", 1942, ''Studies in the History of Culture'' (repr. in 1999, II)
* "Social Causation", 1943, ''American Journal of Sociology'' (repr. in 1956)
* "Diminishing Returns Under Investment", 1944, ''JPE''.
* "Realism and Relevance in the Theory of Demand", 1944, ''JPE'' (repr. in 1999, II)
* "The Rights of Man and Natural Law", 1944, ''Ethics'' (repr. in 1999, II)
* "Human Nature and World Democracy", 1944, ''American J of Sociology''.
* "Economics, Political Science and Education", 1944, ''AER''-->
* {{cite book |title = The Economic Order and Religion |author1 = Knight. F. H.|author2= T.W. Merriam|year= 1945 |place = London |publisher= Kegan Paul, Trench, Trubner & Co., Ltd. |url=https://archive.org/details/economicorderrel0000knig/page/n3/mode/2up |url-access= registration |via = [[Internet Archive]]}}<ref name=Boyd/>
<!--* "Immutable Law in Economics: Its reality and limitations", 1946, ''AER''.
* "The Sickness of Liberal Society", 1946, ''Ethics'' (repr. in 1999, II)
* "Salvation by Science: The gospel according to Professor Lundberg", 1947, ''JPE'' (repr. in 1956)-->
* {{cite book |title= Freedom and Reform: Essays in economics and social philosophy  |year= 1947 |place= Port Washington, NY; London |publisher= Kennikat Press |isbn= 978-0804606202 |url= https://archive.org/details/freedomreformess0000knig_u4q9/page/n5/mode/2up?view=theater |url-access=registration |via= [[Internet Archive]]}} Indianapolis, IN: Liberty Press<ref name=Boyd/>
<!--* "Free Society: Its basic nature and problem", 1948, ''Philosophical Review'' (repr. in 1956)
* "The Role of Principles in Economics and Politics", 1951, ''AER'' (repr. in 1956 & 1999, II)
* "Institutionalism and Empiricism in Economics", 1952, ''AER''.-->
* {{cite book |title= On the History and Method of Economics: Selected essays |url=https://archive.org/details/onhistorymethodo0000knig |url-access= registration  |year= 1956  |place= Chicago |publisher= University of Chicago Press |isbn=978-0226446899}}<ref name=Boyd/>
* {{cite book |title = Intelligence and Democratic Action |year = 1960 | place = Cambridge, Massachusetts |publisher= Harvard University Press |url= https://archive.org/details/intelligencedemo0000knig/page/n7/mode/2up?view=theater|url-access= registration |via= [[Internet Archive]]}}<ref name=Boyd />
<!--* "Methodology in Economics", 1961, ''Southern EJ''
* "Abstract Economics as Absolute Ethics", 1966, ''Ethics''.
* "Laissez Faire: Pro and con", 1967, ''JPE'' (repr. in 1999, II)
* "The Case for Communism: From the Standpoint of an Ex-liberal." (published posthumously) in ''Research in the History of Economic Thought and Methodology'', edited by Warren J. Samuels, archival supplement 2 (1991): 57–108.
* ''Selected Essays by Frank H. Knight, Volume 1: "What is Truth" in Economics?'', (ed. by Ross B. Emmett), 1999, {{ISBN|978-0226446950}}
* ''Selected Essays by Frank H. Knight, Volume 2: Laissez Faire: Pro and Con'', (ed. by Ross B. Emmett), 1999, {{ISBN|978-0226446974}}
 -->

==Awards==
* 1957, Francis A. Walker Medal by the American Economic Association
* 1961, Golden Plate Award of the [[Academy of Achievement|American Academy of Achievement]]<ref>{{cite web|title= Golden Plate Awardees of the American Academy of Achievement |website=www.achievement.org|publisher=[[American Academy of Achievement]]|url= https://achievement.org/our-history/golden-plate-awards/#public-service}}</ref>

==References==
{{reflist}}

==Sources==
* Burgin, Angus (November 2009). "The Radical Conservatism of Frank H. Knight," ''Modern Intellectual History,'' 6:513–538.
* Emmett, Ross B. (1999). "Introduction", in ''Selected Essays by Frank H. Knight'', 2 vols. (ed. by Ross Emmett). {{ISBN?}}
* Emmett, Ross B. (2009). "Did the Chicago School Reject Frank Knight?", in ''Frank Knight and the Chicago School in American Economics'', {{ISBN|978-0415775007}}.
* {{cite web | last = Fonseca | first = Gonçalo L | title = Frank H. Knight, 1885–1972 | work = The History of Economic Thought Website | publisher = [[The New School for Social Research]] | url = http://cepa.newschool.edu/het/profiles/knight.htm | access-date = 2008-05-07 | url-status = dead | archive-url = https://web.archive.org/web/20080429204107/http://cepa.newschool.edu/het/profiles/knight.htm | archive-date = 2008-04-29 }}
* {{cite encyclopedia |title=Frank Hyneman Knight (1885–1972) |url=http://www.econlib.org/library/Enc/bios/knight.html |encyclopedia=[[The Concise Encyclopedia of Economics]] |edition=2nd |series=[[Library of Economics and Liberty]] |publisher=[[Liberty Fund]] |year=2008|isbn=978-0865976665 |editor-first=David R.|editor-last=Henderson |editor-link=David R. Henderson |pages=551–552 }}
* Kasper, Sherryl (2002). ''The Revival of Laissez-Faire in American Macroeconomic Theory: A Case Study of Its Pioneers''. ch. 2. {{ISBN?}}
* [[George Stigler|Stigler, G.]] (1985). "Frank Hyneman Knight", University of Chicago Press – Center for the Study of the Economy and the State, Working Papers Series, Working Paper No. 37.
* [[Harrison White|White, Harrison C.]] (2002). ''Markets from Networks: Socioeconomic Models of Production.'' Princeton: Princeton University Press. {{ISBN?}}
* Hands, D. Wade (2023). "Frank Knight and behavioral economics". ''The European Journal of the History of Economic Thought''. '''30''' (3): 341–368. {{doi|10.1080/09672567.2023.2197249}}. {{ISSN|0967-2567}}.

==External links==
{{wikiquote}}
{{wikisource|works=or}}
* [http://www.msu.edu/~emmettr/fhk/ The Frank H. Knight Page]
* {{Find a Grave}}
* [https://www.lib.uchicago.edu/e/scrc/findingaids/view.php?eadid=ICU.SPCL.KNIGHT Guide to the Frank Hyneman Knight Papers 1908–1979] at the [https://www.lib.uchicago.edu/scrc/ University of Chicago Special Collections Research Center]
* {{Internet Archive author |sname = Frank Hyneman Knight |sopt=t}}

{{Chiconomists}}
{{Presidents of the American Economic Association}}
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{{DEFAULTSORT:Knight, Frank}}
[[Category:1885 births]]
[[Category:1972 deaths]]
[[Category:American atheists]]
[[Category:Economists from Illinois]]
[[Category:Cornell University alumni]]
[[Category:American former Christians]]
[[Category:Historians of economic thought]]
[[Category:University of Chicago faculty]]
[[Category:University of Tennessee alumni]]
[[Category:Presidents of the American Economic Association]]
[[Category:20th-century American economists]]
[[Category:Chicago School economists]]
[[Category:Member of the Mont Pelerin Society]]
[[Category:Journal of Political Economy editors]]
[[Category:Max Weber scholars]]