R?sler，Albert Sch?ffle，Hans von Scheel，Gustav Sch?nberg，and Adolf Wagner.Besides the general principle of anhistorical treatment of the science，the leading ideas which have been most strongly insisted on by this school are thefollowing.I .The necessity of accentuating the moral element in economic study.This consideration has been urged withspecial emphasis by Schmoller in his Grundiragen der Rechtes und der Moral (1875)and by Sch?ffle in his Dasgesellschaftliche System der menschlichen Wirthschaft (1861，3d ed.，1873).G.Kries (d.1858)appears also to havehandled the subject well in a review of J.S.Mill.According to the most advanced organs of the school，three principles oforganization are at work in practical economy；and，corresponding with these，there are three different systems or spheres ofactivity.The latter are (1)private economy；(2)the compulsory public economy；(3)the "caritative"sphere.In the first alonepersonal interest predominates；in the second the general interest of the society；in the third the benevolent impulses.Even inthe first，however，the action of private interests cannot be unlimited；not to speak here of the intervention of the publicpower，the excesses and abuses of the fundamental principle in this department must be checked and controlled by aneconomic morality，which can never be left out of account in theory any more than in practical applications.In the thirdregion above named，moral influences are of course supreme.II .The close relation which necessarily exists betweeneconomics and jurisprudence.This has been brought out by L.von Stein and H.R?sler，but is most systematicallyestablished by Wagnerwho is，without doubt，one of the most eminent of living German economistsespecially in his Grundlegung ，now forming part of the comprehensive Lehrbuch der politischen Oekonomie published by him and ProfessorNasse jointly.The doctrine of the jus nature ，on which the physiocrats，as we have seen，reared their economic structure，has lost its hold on belief，and the old a priori and absolute conceptions of personal freedom and property have given wayalong with it.It is seen that the economic position of the individual，instead of depending merely on so-called natural rightsor even on his natural powers，is conditioned by the contemporary juristic system，which is itself an historical product.Theabove-named conceptions，therefore，half economic half juristic，of freedom and property require a fresh examination.It isprincipally from this point of view that Wagner approaches economic studies.The point，as he says，on which all turns is theold question of the relation of the individual to the community.Whoever with the older juristic and political philosophy andnational economy places the individual in the centre comes necessarily to the untenable results which，in the economic field，the physiocratic and Smithian school of free competition has set up.Wagner on the contrary investigates，before anythingelse，the conditions of the economic life of the community，and，in subordination to this，determines the sphere of theeconomic freedom of the individual.III .A different conception of the functions of the State from that entertained by theschool of Smith.The latter school has in general followed the view of Rousseau and Kant that the sole office of the state isthe protection of the members of the community from violence and fraud.This doctrine，which was in harmony with those ofthe jus naturae and the social contract，was temporarily useful for the demolition of the old economic system with itscomplicated apparatus of fetters and restrictions.But it could not stand against a rational historical criticism，and still lessagainst the growing practical demands of modern civilization.In fact，the abolition of the impolitic and discredited system ofEuropean Governments，by bringing to the surface the evils arising from unlimited competition，irresistibly demonstrated thenecessity of public action according to new and more enlightened methods.The German historical school recognizes theState as not merely an institution for the maintenance of order，but as the organ of the nation for all ends which cannot beadequately effected by voluntary individual effort.Whenever social aims can be attained only or most advantageouslythrough its action，that action is justified.(5)The cases in which it can properly interfere must be determined separately ontheir own merits and in relation to the stage of national development.It ought certainly to promote intellectual and aestheticculture.It ought to enforce provisions for public health and regulations for the proper conduct of production and transport.
It ought to protect the weaker members of society，especially women，children，the aged，and the destitute，at least in theabsence of family maintenance and guardianship.It ought to secure the labourer against the worst consequences of personalinjury not due to his own negligence，to assist through legal recognition and supervision the efforts of the working classesfor joint no less than individual self-help，and to guarantee the safety of their earnings，when intrusted to its care.
A special influence which has worked on this more recent group is that of theoretic socialism；we shall see hereafter thatsocialism as a party organization has also affected their practical politics.With such writers as St.Simon，Fourier，andProudhon，Lassalle，Marx，Engels，Marlo，and Rodhertus，we do not deal in the present treatise；but we must recognizethem as having powerfully stimulated the younger German economists (in the more limited sense of this last word).Theyhave even modified the scientific conclusions of the latter，principally through criticism of the so-called orthodox system.
