Books

Boston & New York: Houghton Mifflin Company, 1920. First edition of Knight's classic treatise, published the same year as the first but without the publication year to the title page. Octavo, original cloth, printer's device to the title page. In very good condition, with marginalia to the text. First editions are exceptionally rare. In economics, "Knightian uncertainty" is risk that is immeasurable, impossible to calculate. Knightian uncertainty is named after University of Chicago economist Frank Knight (1885-1972), who distinguished risk and uncertainty in his work "Risk, Uncertainty, and Profit": "Uncertainty must be taken in a sense radically distinct from the familiar notion of Risk, from which it has never been properly separated.... The essential fact is that 'risk' means in some cases a quantity susceptible of measurement, while at other times it is something distinctly not of this character; and there are far-reaching and crucial differences in the bearings…

Risk, Uncertainty and Profit, written by Frank H. Knight, is a landmark in economic literature that introduces the distinction between risk, which can be measured and quantified, and uncertainty, which cannot.