Nobel laureates Milton Friedman, George Stigler and James M. Buchanan were all students of Knight at Chicago.

Hayek considered Knight to be one of the major figures in preserving and promoting classical liberal thought in the twentieth century.

Knight was one of the world's leading economists, having made significant contributions to many problems of both economic theory and social philosophy.

He argued that these situations, where decision making rules such as maximising expected utility can be applied, differ in a deep way from "uncertain" ones, in which not only the outcomes, but even the probability models that governed them, were unknown.

However, the Knightian concept of uncertainty has been recognized in a variety of works: John Maynard Keynes discussed it at length in his Treatise on Probability; [7] Armen Alchian relied on it for discussing market behavior in his seminal paper Uncertainty, Evolution and Economic Theory; Paul Davidson incorporated it as an essential element in the Post Keynesian school of economics he co-founded; and G.L.S.

As more trucks use the narrower and better road, congestion develops, until at a certain point it becomes equally profitable to use the broader but poorer highway.Knight was a co-founder and vice president of the Mont Pelerin Society of like-minded economists.