7. Amateur Publications

See Are (1963).

Pareto to Emilia Peruzzi, 3rd and 16th December 1875, see Pareto (1984a, pp. 554, 556). Readers are reminded that Pareto had first-hand knowledge of the subject from his previous experience as an employee of the Romane and from his current position as director of the San Giovanni ironworks (see Chap. 3 above).

See Pareto (1876a, pp. 92–94).

Ibid., pp. 94–96.

See Pareto (1876b, p. 104).

See Pareto (1876a, p. 96).

Ibid.

See Pareto (1876b, p. 104).

This free-trade society had been created in 1874 at Florence, on suggestion by the well-known free-trade economist Francesco Ferrara, and it had, as its journal, L’economista. Pareto was one of the first members of the Adam Smith Society, see Pareto (1984b, pp. 406–407, 428). On the intellectual biography of Francesco Ferrara (1810–1900), see Faucci (1995).

On these events in general, see Berselli (1997, pp. 759–827). It is of interest to note that Pareto reproached Minghetti for having radically modified his positive attitude to ownership and private management of railways, as expressed on the occasion of the railways debate of 1864, and for having justified this with the argument, which Pareto considered weak, that the monopolistic nature of the railways would discourage their being entrusted to private operators, see Pareto (1876c, p. 9). Pareto, on the other hand, justified Peruzzi’s switch to the opposition during the last Minghetti government as a praiseworthy liberal reaction to the statesman from Bologna’s conversion to state control, ibid., pp. 16–17.

See Pareto (1876c, pp. 46–48).

Ibid., p. 47.

Ibid., pp. 48–49.

Pareto (1876c, pp. 19–20).

Ibid., p. 18.

Ibid., p. 20.

Ibid., p. 22.

Ibid., p. 21.

See Pareto (1885).

See Pareto (1876e, pp. 54–55).

See Pareto (1876f, p. 64).

See Pareto (1876e, p. 58).

See Pareto (1876e, p. 59).

See Pareto (1876g, p. 86).

See Pareto (1876f, p. 62).

See Pareto (1876g, p. 85).

Ibid., pp. 88–89.

Ibid., p. 87.

Ibid., p. 86 and see Pareto (1876h, p. 54) too.

See Pareto (1878, pp. 55–57).

See Pareto (1886, p. 207).

See Pareto (1887a, pp. 231–232).

Pareto to Francesco Papafava, 9th December 1888, See Pareto (1981, p. 603).

Ibid.

On Alfredo Baccarini from Romagna (1826–1890), engineer, patriot, member of Parliament, minister and exponent of the Cairoli (i.e. anti-Depretis) grouping of the Historical Left, see Varni (1983) and Plazzi and Varni (1993). Having clarified that the objective of all liberals should be to achieve the maximum possible growth in national income in order to facilitate the widest possible diffusion of “relative private prosperity”, see Baccarini (1907, p. 115), Baccarini made the distinction between absolute poverty, defined as a person’s involuntary inability to satisfy his or her primary needs, and relative poverty, defined as a person’s inability to satisfy his or her non-essential needs. Absolute and relative poverty must be countered respectively by the family and by single individuals with the help of society which, in this regard, ibid. pp. 86, 115, must set “the minimum limit for the proceeds of toil and the maximum limit for the proceeds of speculation”. The former limit constitutes an acknowledgement “that when mankind works he should at least have the right to eat” which is defined precisely, ibid. p. 118, as the minimum salary that the state could impose on public works contractors to pay their piecework labourers, to be determined, “in full awareness of the facts and with reliable criteria”, on the basis of an analysis of the cost of labour which invariably contributes to the fixing of bid prices in tenders. The maximum level of proceeds from speculation, on the other hand, refers to speculative profits deriving from arbitrage on government (i.e. risk-free) bonds which, ibid. pp.119–120, if it cannot be outlawed, can nevertheless be encumbered with a heavy tax burden.

See Pareto (1886, pp. 202, 205).

Ibid., p. 196.

Ibid., p. 197. According to Pareto, in any case, “it is better for a country to have a smaller number of citizens living comfortably than a larger number [who are] destitute”, ibid., p. 203.

Pareto was referring, even if implicitly, to the third chapter of the second part of J. E. Cairnes, Some fundamental principles of political economy newly explained (Alcuni principii fondamentali di economia politica nuovamente esposti), translated from the English by Sidney Sonnino and Carlo Fontanelli, Florence, Barbera 1877.

See Pareto (1886, pp. 201, 202). In this case, the strikes would only accelerate the increase in salaries, which would take place in any case.

Ibid., p. 206.

Pareto to Francesco Papafava, 4th December 1888, see Pareto (1981, p. 598).

Ibid.

Pareto, still general manager of the ironworks, did not thus consider that the average output of work increased more than proportionally to the reduction in hours, in absolute terms.

Ibid.

Ibid.

Ibid. and Pareto to Francesco Papafava, 10th December 1888, ibid., p. 610.

Ibid. p. 608.

See George (1879) particularly book VIII.

Pareto to Francesco Papafava, 10th December 1888, see Pareto (1981, p. 610).

Ibid. pp. 608, 610.

Ibid.

Pareto to Francesco Papafava, 4th and 10th December 1888, ibid., pp. 599, 610.

Pareto to Francesco Papafava, 9th December 1888, ibid., p. 604.

This refers to Pareto’s collaboration with the American anarchist periodical “Liberty” (on the history and content of this publication see McElroy (2003) which he interrupted only through lack of time, Pareto to Francesco Papafava, 8th April 1889, see Pareto (1981, p. 633).

Pareto to Francesco Papafava, 26th January 1889, ibid., p. 629.

Ibid.

See Pareto (1888a, p. 16).

See Pareto (1890a, p. 660).

See Pareto (1891a, p. 416).

See Pareto (1878, p. 53). This view was explicitly reiterated by Pareto many years later, see Pareto (1885, p. 305).

See Pareto (1888b, p. 277).

Pareto to Emilia Peruzzi, 7th May 1873, see Pareto (1984a), p. 203.

In consequence, referring to the harshness of Ferrara’s treatment of the Italian chair socialists in his famous article “The German school of economics in Italy (Il germanesimo economico in Italia).”, Nuova Antologia, 1874: 983–1018, Pareto observed that “when you have a few little sins on your conscience as he does you could be a little less exacting towards your opponents”.

A few years later Pareto observed that whereas in England, as a result of the country’s free institutions, the aristocracy had been compelled to accept Cobden’s Anti-Corn Law League, the Italian bourgeoisie would never tolerate the establishment of a league against the tax on flour, see Pareto (1888c, p. 28).

See Pareto (1878, p. 54).

Ibid., pp. 46–50, 56, 58.

Ibid., p. 55.

See Pareto (1885, p. 315).

Ibid., p. 314.

Ibid., p. 306.

Ibid., p. 313.

Ibid., p. 491.

Ibid., p. 489.

Ibid., pp. 490–491.

Ibid., p. 491.

See Pareto (1887b, p. 2). On this question see Marongiu (1996, pp. 272–310). Pareto to Francesco Papafava, 10th December 1888, see Pareto (1981, p. 610) asserted that taxes on consumption, which he thought had “reached the absolute limit” in Italy, were in part shifted from “the poor”, that is, working people, to “the rich”, in terms of an increase in cash salaries which amounted however to a burden for poor people because it came down to a sum being advanced to the state and then needing to be recovered from the employer; in other words indirect taxes “oblige [the poor] to act as tax collector from the rich on behalf of the government”.

See Pareto (1890b, 417–418).

Based on data he gathered himself, Pareto, ibid., pp. 420, 424–425 established that the total earnings of the Florentine family amounted to 2380 lire of which 1953 lire was spent on food and clothing, an estimated 182 lire was paid to the state and 72 lire to the municipality in indirect taxes, 89 lire to protected producers and 165 lire to the state, 10 lire to the provincial authorities and 47 to the municipal authorities in direct taxes.

On the basis of data on earnings published by the English philanthropist Miranda Hill and data on taxation supplied to Pareto by William Carr Crofts, secretary of the British free-trade association Liberty and Property League, Pareto, ibid., p. 425, stated that the annual expenditure of the English family was 1915 francs and estimated that 24 francs were paid in imperial taxes (government indirect taxes) and 60 francs in local taxes (local direct taxes).

See Pareto (1890c, pp. 77–78).

Ibid., p. 79.

See Pareto (1890c, pp. 11–13).

Pareto to Francesco Papafava, 6th December 1891, see Pareto (1989, p. 113).

See Pareto (1890d, p. 324).

Ibid., pp. 325–326.

See Pantaleoni (1890, pp. 139–176). Using the method conceived by the French statistician Alfred De Foville, Pantaleoni estimated probable national private wealth for each year over the period from the 1872 fiscal year to the 1888–1889 fiscal year, increasing the values representing inheritances or donations by a quarter (to allow for tax evasion) and multiplying the figure thus obtained by the number of years, fixed at 36, the average duration of a generation. Pantaleoni, among his various reflections, pointed out that if the interval in question were divided into three periods of five years, the increase in wealth per capita between the last five-year period (corresponding to the second half of the 1880s) and the preceding one is less than the corresponding increase between the second five-year period and the first, ibid., pp.156–158. On the basis of an Italian population which was four fifths that of France, the Italian-French ratio regarding private wealth, foreign trade and post office savings deposits is still less than the demographic difference, suggesting that “we are significantly poorer than our cousins”, ibid., p. 171. On the biography of Maffeo Pantaleoni (1857–1924), economist, politician and important friend of Pareto, see Michelini (1998) and Bellanca and Giocoli (1998).

See Pareto (1890f, pp. 329–330).

Ibid., p. 328.

See Pareto (1890g, p. 335).

See Pareto (1891b, p. 380).

See Pareto (1891c, 3, pp. 410, 412).

Letter to Francesco Papafava, 10th December 1888, see Pareto (1981, p. 595). Readers will recall that Pareto, in keeping with his Malthusian beliefs, had no children.

See Pareto (1886, p. 194, 212).

See Pareto (1888b, p. 285).

As demonstrated by the rapid recovery of populations in the wake of wars or epidemics as well as by Darwin’s studies which, in Pareto’s view, left no room for doubt regarding the tendency shown by human beings, in what was certainly a “necessary condition” for their survival, to grow more numerous “than warranted by available resources”, a tendency which emerged “as soon as conditions were favourable”, ibid., p. 288.

Pareto to Francesco Papafava, 3rd December 1888, see Pareto (1981, p. 595).

Ibid.

Ibid., p. 596.

Ibid., p. 610.

Ibid., p. 611.

See Pareto (1891b, p. 392).

Pareto to Francesco Papafava, 17th January 1891, see Pareto (1989, pp. 122–124).

Held at the end of 1875, this convention addressed issues concerning the negotiations for the renewal of the commercial treaty with France, which the Florence-based society feared were influenced, on the Italian side, by protectionist aims. Regarding these complex negotiations, which culminated only on the 3rd of November 1881 with the renewal, on a somewhat protectionist basis, and for ten years reduceable to six, of the Italian-French commercial treaty originally stipulated on the 17th of January 1863, see Pecorari (1989).

See Pareto (1875, pp.38–39).

This duty was calculated as a certain amount in lire per unit imported.

This disparity would obviously penalise the national production of finished goods which customs protection was intended to promote.

This duty was calculated as a percentage applied to the price of imported goods.

Ibid., pp. 39–40.

Ibid., p. 41.

See Pareto (1887a, pp. 218, 224).

See Pareto (1887a, p. 237).

See Pareto (1887b, p. 15) and Pareto (1887c, p. 239).

The treaty was not extended again, with the result that from the 1st of March 1888 Italian-French trade was subjected to standard customs duties, augmented by special rates (referred to as differential rights) which Italy abolished from the 1st of January 1890 and France from the 1st of February 1892; see Calderoni (1961, pp. 64–65, 69). Pareto assigned the responsibility for this breakdown in relations to both Italian and French protectionists; see Pareto (1889a, p. 174). For the French view on this trade war, see Milza (1978); for the Italian view see Del Vecchio (1979, pp. 231–449). For the prolonged after-effects this affair had on Italo-French economic relations, see Gille (1967).

Ibid., pp. 96–97.

Ibid.

Ibid., p. 103.

Ibid., pp. 105–106.

Ibid., p. 106.

Ibid.

See Pareto (1889a, p. 161).

See Pareto (1887b p. 1).

Pareto to Emilia Peruzzi, 17th November 1887, see Pareto (1984b, p. 362).

See Pareto (1887b, pp. 2–3).

Ibid., pp. 4–5.

See Pareto (1889a, p. 161).

Ibid.

Ibid., pp. 171–172.

Ibid., p. 170.

Ibid., pp. 165–166, 168, 176.

See Pareto (1890h) and Pareto (1890i, 347).

See Pareto (1890h, p. 332).

See Pareto (1891c, pp. 410, 412).

Ibid., pp. 410–411 and see Pareto (1891d, p. 311).

See Pareto (1890b, p. 427).

Ibid., pp. 426–427.

Ibid., p. 427.

For the most recent research monographs on fiscal and monetary aspects of Italian economic policy at the time, see Marongiu (1995), Marongiu (1996) and Fratianni-Spinelli (p. 121–219).

Ibid., pp. 170–178. In this case, fiat money refers to the abolition of the requirement for issuing banks to convert their notes into precious metals, which had been introduced on the 1st of May 1866, nominally in order to meet expenditure requirements for the third war of independence, and which were paid to the Italian state by the Banca Nazionale nel Regno d’Italia (the most important of the issuing banks).

Ibid., pp. 170–175.

To reduce the competitiveness of imported goods, which had increased with the revaluation of the lira.

Pareto to Antonio Allievi, 18th November and 4th December 1880 BPS-la.

The minister identified this damage as being, respectively: fluctuations in the value of paper money; the resulting higher base rate in Italy in comparison to other countries; increased costs in regard to state expenditure; increased interest payable in gold to foreign holders of Italian public debt; the braking effect on the growth of tax proceeds and the uncertainty attaching to the various items in the state balance sheet; see Pareto (1880, pp. 63–65).

Ibid., p. 62.

According to Pareto, ibid., pp. 63–65, even gold, which would take up the role of paper money in payments were the fiat money abolished, did not have a perfectly stable value, although it certainly showed less variability than did paper money. The higher Italian base rate was, most of all, the result of the structural problem of the lower availability of capital. The fiat money, by facilitating the increase of credit and hence of commercial transactions, also increased the tax base. Variability in the value of paper money was lower and so generated less uncertainty for the public finances than did variability in prices for goods.

Ibid., pp. 67, 69 and see Pareto (1881, 77).

Instead, the issue was placed in Paris and in London.

See Pareto (1880, pp. 67–68).

Ibid., p. 68.

Ibid., pp. 68–69.

Ibid., p. 72.

Ibid.

See Pareto (1881, p. 75).

See Pareto (1880, p. 72).

Ibid., p. 73 and see Pareto (1881, p. 78).

See Pareto (1880 p. 73). Magliani’s bill was approved on the 7th of April 1881. Following the successful issue of state bonds, the fiat money was abolished (but only temporarily, as it turned out) on the 12th of April 1883.

See Pareto (1881, p. 76).

Ibid., p. 75.

See Pareto (1885, p. 308).

See Pareto (1888b, p. 277).

Ibid., pp. 278–279.

See Pareto (1889b, p. 31).

Ibid.

See Pareto (1890j, p. 396).

See Pareto (1891b, p. 376).

Ibid., p. 376.

Ibid., pp. 376–377.

Ibid., p. 389.

Ibid., p. 395.

Ibid., p. 389.

Ibid., p. 393.

Pareto to Francesco Papafava, 13th December 1888, see Pareto (1981, pp. 617–620).

See Pareto (1891b, pp. 390–391, 395).

Ibid., p. 391.

Ibid., p. 395.

Ibid., p. 401.

Ibid., p. 398.

Ibid., p. 409.

See Pareto (1891a, p. 420).

Ibid., p. 412.

Ibid., p. 413.

Ibid., p. 414.

Ibid., p. 415.

See Pareto (1877, p. 78). These famous two series, comprising 26 volumes in all, were published under the direction of Francesco Ferrara from 1850 to 1869. Further evidence regarding Pareto’s early reading with regard to the foundations of political economy is to be found in his comment that if Bastiat “is possibly somewhat lacking in depth, at least he had the merit of setting out a crystal-clear analysis of the principles of political economy”; see Pareto (1885, p. 308).

See Pareto (1875, pp. 37–38). In June 1875, Pareto had begun his study of Thornton’s book On labour: its claims and its rights, its present and possible future, in a contemporary Italian translation (Del lavoro: delle sue pretese e dei suoi diritti, del suo presente e del suo futuro possibile, Florence: Barbera, 1875) by his friends Sidney Sonnino and Carlo Fontanelli. Pareto wished to take the opportunity to compare Thornton’s and Mill’s theories on value, proposing (but without following it up) that if he found “something new to say”, he would write about it in L’Economista, Pareto to Emilia Peruzzi 17th and 18th June 1875, see Pareto (1984a, pp. 515–516). In particular, in this Thornton’s work (second book, passim), the plausibility of J. S. Mill’s version of the law of supply and demand (whereby an equilibrium market price is set which varies in accordance with variations in supply and/or demand), is challenged by the argument that the market price, and not necessarily the equilibrium price, is determined by competition (again, is not further defined) between buyers and sellers at a level between the maximum price the buyers are willing to pay and minimum price demanded by sellers. On the role of competition in the determination of market prices, Thornton claimed that if the pressure to buy is greater than the pressure to sell, competition between sellers is eliminated and they can charge buyers a price approaching the maximum, while if the pressure to sell is greater than the pressure to buy, competition between buyers is eliminated and they can impose on the sellers a price approaching the minimum.

See Pareto (1875, pp. 38–39).

See Pareto (1887a, p. 221) and Pareto to Francesco Papafava, 19th September 1889, see Pareto (1981, p. 642).

See Pareto (1887a, pp. 221–224).

Ibid.

Ibid., pp. 282–283.

Ibid., p. 284.

Ibid., p. 285.

Ibid., p. 285. Boccardo, see Boccardo (1879, pp. 229, 232–234) claimed that, in general, the rent (not only from land) constituted the return for a natural monopoly exploited by the beneficiary to achieve innovations which would be impossible without privileges, which themselves, while beneficial for humanity, limited the actual rent.

See Pareto (1891b, p. 393).

Pareto to Emilia Peruzzi 2nd June 1875, see Pareto (1984a, p. 513).

See Pareto (1876c, p. 19).

Pareto to Emilia Peruzzi 18th March 1881, see Pareto (1984b, p. 136).

Felice Ambrosi, “The Philological Society.” La Nazione, 22nd March 1881.

Many years later, see Pareto (1891b, p. 388), Pareto noted the strength of the tendency in the human mind “to create and worship fetishes” such as the monarchy or universal suffrage, the latter with its associated belief that “the majority view is always the one most closely approaching the truth”. Pareto countered that “there is no error that has not at some time been believed by the majority of men”.

Ibid., p. 377.

See Pareto (1888d, p. 15).

Among whom Enrico Pani Rossi, Pasquale Turiello, Pasquale Villari, all considered as moderates, Leopoldo Franchetti, considered a centrist, Jesse White Mario and Carlo Dotto De’ Dauli, denominated members of the “advanced” party, see Pareto (1889b), p. 30.

Ibid., pp.31–32.

Ibid., p. 34.

See Pareto (1889c, p. 297).

See Pareto (1889d, p. 301).

Ibid., pp. 301–302.

The earliest sources for Pareto’s thinking on Italian politics were the volumes published at the end of the 1880s by Luigi Zini, the scholar and politician from the region of Emilia (On the criteria and methods of government of the Left [Dei criteri e dei modi di governo della sinistra]), by Pasquale Turiello the Napolitan academic (Government and governed in Italy [Governo e governati in Italia]) and by the scholar and former minister Stefano Jacini from Lombardy (Thoughts on Italian politics [Pensieri sulla politica italiana]), which were read by Pareto with interest despite his “position being as far removed as can be imagined from that of the moderates” to which the latter claimed allegiance, Pareto to Emilia Peruzzi 16th October 1888, 26th June and 4th July 1889, see Pareto (1884b, pp. 386, 405–406).

See Pareto (1887b, p. 1).

At the beginning of 1891 Pareto declared, see Pareto (1891b, p. 409), that “limiting the power of parliaments” was the problem upon whose “solution further progress in our society depends”.

In Pareto’s view it is very difficult to determine to what extent a politician sacrifices a nation’s interests to his own, conceding that on occasion the politician “believes he is acting for the interest of his country” while in reality he is only taking advantage of circumstances “to increase his own fortune or his power”, see Pareto (1884d, p. 17).

See Pareto (1887b, p. 18).

Ibid.

See Pareto (1889e, p. 36).

See Pareto (1888d, pp. 18–19). In his early political commentaries, Pareto did not take into consideration the form of government (monarchy or republic) because “to economists as to many other sociologists it appears of little moment”; see Pareto (1890d, p. 11).

Pareto to Francesco Papafava, 13th December 1888, see Pareto (1981, p. 620).

See Pareto (1890k).

See Pareto (1889b, p. 32).

Ibid., p. 33.

Ibid.

Ibid., p. 36.

See Pareto (1890j, p. 394).

See Pareto (1890l, pp. 350–351).

See Pareto (1890m, p. 83).

That is, the right accorded to a person being arrested to have immediate recourse to a judge in order to determine the effective legality of the arrest.

Ibid.

See Pareto (1890n, p. 420).

See Pareto (1891e, p. 40).

Ibid., p. 41.