Wolfgang Kasper, 1939-2023
Classical liberalism’s stout freedom fighter
Wolfgang Kasper has died at the age of 84 after suffering a stroke on 13 August. Wolfgang was a stalwart of the classical liberal tradition in Australia and had an influence on economics and public policy in Australia, New Zealand and around the world.
His Wikipedia entry only hints at his intellectual contributions and influence. Wolfgang would have been amused by the edit history, which includes a correction that ‘He is an Australian economist not an Austrian economist.’ He was, of course, both, perhaps the finest exponent of the Austrian tradition in Australia.
As a young economist, Wolfgang played a role in the Bürgenstock conference in 1969 that laid the intellectual groundwork for dismantling the Bretton Woods system of fixed exchange rates. By the time the Bretton Woods system collapsed in the early 1970s, the technical feasibility and desirability of floating exchange rates had been well established, largely as a result of their efforts. Remarkably, the conference papers, including Wolfgang’s contribution, are still in print.
I got Wolfgang to write about Bürgenstock for the CIS journal Policy when I was editor (see The emergence of free exchange rate regimes - a personal account). Wolfgang shared with me his autobiographical recollections of the conference, as well as some of the super-8 home movie he shot there.
Bürgenstock showed how a small group of liberal economists could come together, formulate and disseminate ideas and influence public policy for the better. It was a model of intellectual and policy entrepreneurship that Wolfgang would bring with him to Australia, to great effect.
Wolfgang arrived in Australia in the 1970s to find a closed and insular economy that was underperforming its potential. As a classical liberal and internationalist, Wolfie was having none of it. He became a key figure in a vanguard of reform-minded liberal economists who made the case for opening and liberalising the Australian economy. One of their most important contributions was the 1980 publication, Australia at the Crossroads – Our Choices to the Year 2000, along with John Freebairn, Douglas Hocking and Robert O’Neill. The Crossroads group anticipated the economic reforms that would transform the Australian economy in the 1980s and 1990s.
Kasper was an important voice throughout the reform era, urging Australian policymakers to continue pushing the frontier of economic liberalisation. He highlighted the under-appreciated role of international factor mobility, particularly of capital and labour, and was influential in arguing for the benefits of foreign investment and immigration.
His 1984 volume for the Centre for Independent Studies, Capital Xenophobia: Controls of Foreign Investment in Australia, made the case for liberalising Australia’s regulation of FDI. Within four years, the Coalition had abolition of the Foreign Investment Review Board as part of its policy platform. When I wrote a follow-up for CIS in 2009, I could not improve on Wolfgang’s original title and so called it Capital Xenophobia II. Wolfgang generously wrote the foreword to my monograph.
Wolfgang wrote numerous other reports on the topic, including ‘How to Maximise the Benefits of Direct Foreign Investment’ for the 1992 Economic Planning and Advisory Council volume, The Regulation of Capital Inflow. His 1998 paper for CIS Open for Business? Australian Interests and the OECD’s Multilateral Agreement on Investment anticipated and sought to counter the trade union and ‘civil society’ attack on international capital mobility that would ultimately de-rail the OECD multilateral investment agreement.
Perhaps Wolfgang’s most important work was Institutional Economics: Property, Competition, Policies, now in its second edition, with co-authors the late Manfred E. Streit and Peter J. Boettke. It is the best overview to Wolfgang’s distinctive way of thinking. I have an autographed copy of the first edition, but have still not caught up with the second. This newsletter takes its name from the tradition Wolfgang represents so well in that first volume.
Wolfgang also had an abiding interest in emerging Asia and China and was an influential economic policy advisor in Malaysia both before and after moving to Australia. Institutional Economics was translated into Chinese and published in China. Well before it was fashionable, Wolfgang was promoting the importance of economic engagement with the region and he traveled extensively throughout Asia. His travels were facilitated by his fluency in several languages.
Wolfgang was always generous towards me and could be relied upon to provide a robust critique of any manuscript sent his way. I think I last saw him, along with the lovely Regine, over dinner in Sydney in 2014, a couple of months before I left CIS. We disagreed strongly on some aspects of immigration policy, but it was a respectful disagreement.
He could be dogmatic, didactic and even cranky at times, but always out of passion and conviction rather than closed mindedness. If the arc of history bends toward liberty, Wolfie was always there to lend his stout frame and inquiring mind to the bending. In the light of his worldview, it is hardly surprising that it took a foreign import to help show Australians that their future was a policy choice and that we could choose better.