Frank Knight

Date of Birth: November 7, 1885

Zodiac Sign: Scorpio

Date of Death: April 15, 1972

Biography

Frank Hyneman Knight was a pioneering American economist and one of the founding figures of the Chicago school of economics. Born on November 7, 1885, in McLean County, Illinois, Knight is best known for his work on the theory of risk, uncertainty, and profit. His seminal book, “Risk, Uncertainty, and Profit,” published in 1921, laid the groundwork for distinguishing between calculable risks and true uncertainty, concepts that have had a profound impact on economic theory and decision-making under uncertainty. Knight earned his Ph.D. from Cornell University in 1916 and went on to teach at the University of Iowa and later at the University of Chicago, where he became a central figure in the development of economic thought. He was a mentor to several Nobel laureates, including Milton Friedman and George Stigler. Knight was known for his skepticism of central planning and his strong advocacy for free markets, although he also recognized the limitations and complexities inherent in economic systems. Knight’s work extended beyond economics into social philosophy and ethics, where he explored the intersections between economic theory and moral considerations. He remained an active and influential voice in economic debates until his death on April 15, 1972.

5 Interesting Facts about Frank Knight

1. Frank Knight coined the term “Knightian uncertainty” to describe situations where the probability of outcomes cannot be calculated.

2. He was a founding member of the Mont Pelerin Society, an international neoliberal organization.

3. Knight’s critique of “perfect competition” and “monopoly” models influenced the development of modern microeconomics.

4. He was an outspoken critic of both socialism and laissez-faire capitalism, advocating instead for a balanced approach.

5. Knight’s teachings and writings significantly shaped the Chicago school of economics, influencing generations of economists.

5 Most Interesting Quotes from Frank Knight

1. “The essence of economic theory is the understanding that human decisions are made under conditions of uncertainty.”

2. “All science is static in the sense that it describes the unchanging aspects of things.”

3. “Profit is the reward for uncertainty-bearing.”

4. “The truth is that economics is a branch of that group of sciences which deal with human behavior.”

5. “To have a system in which economic activity is directed by a central authority is to have a society in which the individual is enslaved.”

Highest Net Worth Achieved

Frank Knight’s highest net worth is not well-documented, but as an academic and professor, his influence and intellectual capital far exceeded his monetary wealth.

Children

Frank Knight did not have any children. His intellectual legacy, however, lives on through his numerous students and the extensive body of work he left behind.