To Hayek, the intellectual reconstruction of Austria was just as important as its political and economic reconstruction. He worked tirelessly in the postwar years in an attempt to rejuvenate Austria’s proud tradition in economics.
He was drawn to the plight of scholars and students in Austria, particularly in Vienna. He realized that it was essential for them to regain contact with the Western academic world after Austria’s long period of isolation. To that end, back in London, Hayek founded the Austrian Book Committee. As chair, he appealed to prominent Austrians and non-Austrians alike to collect books and funds to assist Austrian libraries in rebuilding their collections in the humanities and social sciences, particularly with items published in the West since 1938. With prominent figures such as Lord Beveridge among the sponsors, by December 1947 the committee had already collected some 2,500 books, and Hayek traveled to Vienna to arrange for the shipment. Although this shipment was received in Vienna with gratitude, the appalling inefficiency of the bureaucracy there eventually forced the committee to wind up its operations in July 1948.
In 1947 Hayek participated in the “International College”—an informal gathering of scholars and students founded in the small mountain village of Alpbach as a forum for philosophical, political, and economic ideas. Hayek inspired many of his Austrian friends to participate, including philosopher Karl Popper, physicist Ernst Schrödinger, and economists Haberler, Machlup, and Mises. (This charming and stimulating “summer school” prospers today as the world-famous European Forum Alpbach.)
Deeply concerned with the large number of eager students in Austria “who receive no adequate teaching but who might well some day continue the Viennese tradition if they were given an opportunity to acquaint themselves with the state of modern economics,” Hayek worked hard to organize a reunion of Austrian economists in the form of a summer school in Vienna and persuaded a number of his friends—including Haberler, Machlup, and Mises—to teach there. Using seed money from the Rockefeller Foundation and funding from a small group of Austrian industrialists, in July 1948 he launched the school, which later developed into the Meinl-Collegium. (Among the students there was Reinhard Kamitz, who became Austria’s minister of finance and was instrumental in the Austrian economic miracle of the 1950s and early 1960s.) ..
In 1950 Hayek accepted an appointment at the University of Chicago, which made traveling back to Europe expensive and time-consuming. Still, Hayek did not rest.
In his final attempt to revive Austria’s great academic tradition, Hayek became one of the driving minds behind the founding of the Austrian Institute in New York in 1954. He circulated a detailed assessment of the condition and needs of the University of Vienna, which he opened with a dramatic appeal: “One of the great centers of science and scholarship which during the last 3 or 4 generations has given the world perhaps as many original thinkers of the first rank as any other is in acute danger.” He continued: “There is still a spark glimmering, there is still left an atmosphere and a number of first class men that should make it possible to revive the old tradition. . . . The neutralization of Austria and the traditions of Vienna offer an exceptional opportunity . . . in the present ideological struggle of the world to revive the University of Vienna as a main intellectual fort at the boundaries of the West.” Although an American Committee for Vienna University supported the idea and moved things forward, strong local academic and partisan interference eventually frustrated Hayek’s efforts. To get around the bureaucratic hurdles and resistance, Hayek rephrased his original idea and presented a new proposal for a private research institution in Vienna to several U.S.-based foundations. His proposal outlined the tasks, structure, and academic mission of the institute in great detail, and in 1959 he finally met successfully with several leading Austrian politicians. Thanks to a major contribution by the Ford Foundation, the Institute for Advanced Studies was established in Vienna shortly thereafter; Hayek taught there in the spring of 1963.