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2020 | Book

General Introduction: Why Should We Study the History of Economic Theory? Read chapter Read first chapter

Economic Theory in the Twentieth Century, An Intellectual History - Volume I

1890-1918. Economics in the Golden Age of Capitalism

Author: Prof. Roberto Marchionatti

Publisher: Springer International Publishing

Part of: Springer Professional "Wirtschaft+Technik" , Springer Professional "Wirtschaft"

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About this book

This book, set out over three volumes, provides a comprehensive history of economic thought in the 20th century with special attention to the cultural and historical background in the development of theories, to the leading or the peripheral research communities and their interactions or controversies, and finally to an assessment and critical appreciation of economic theories throughout these times. It takes as its subject matter the canon of publications by major thinkers who self-consciously conceived of themselves as 'economists' in the modern academic sense of the term. It is a history of how, when and where the discipline of Economics took root in major universities and scientific communities of economists, and evaluates the emergence of different 'schools' of thoughts.

Volume I addresses economic theory in the golden age of capitalism. It considers the contributions of Marshall, Pareto, Wicksteed, Schmoller, Bohm-Bawerk, Schumpeter, Wicksell, Fisher, Veblen and other major thinkers, as well as the universities of Cambridge, Lausanne, Vienna, Berlin, and some others in US, before concluding with a look at the impact that the great war had on the discipline.

This work provides a significant and original contribution to the history of economic thought and gives insight to the thinking of some of the major international figures in economics as shown in major works published across the last 130 years. It will appeal to students, scholars and the more informed reader wishing to further their understanding of the history of the discipline.

Table of Contents

Frontmatter
1. General Introduction: Why Should We Study the History of Economic Theory?
Abstract
The General Introduction criticizes the mainstream conception of the history of economic thought as rational reconstruction and offers a different perspective of the role of the history of economic thought in economics. Mainstream approach treats the thinkers of the past as if they are contemporaries with whom it is possible to exchange views. It represents the point of view of those who regard earlier economic doctrine as simply ‘the wrong opinions of dead men’. On the contrary, author’s approach assigns an important role to the historical reconstruction of the theoretical contributions of different economists and combines historical with intellectual reconstruction in order to recover the thinking of the authors of the past in its entirety and to grasp their intellectual activity as a whole.
Roberto Marchionatti

Economic Theory in the Golden Age of Capitalism: From the Last Decades of the Nineteenth Century to the First World War

Frontmatter
2. Introduction
Abstract
The introduction to Volume I deals, first, with the historical scenario of the twenty-five years preceding the Great War, the final period of the epoch of classical liberal capitalism. Then, the background of the economic theory of the period is analyzed: the crisis of classical political economy, the Historical School’s criticism, and the legacy of the marginalist and neoclassical Revolution. Lastly, the map of economic theory from the last decade of the nineteenth century to the First World War is sketched, when the economic theory that arose with the marginalist-neoclassical revolution of the 1870s took definitive form through the efforts of economists like Marshall, Pareto, von Böhm-Bawerk, Wicksell, Wicksteed, and Fisher and the group of scholars who collaborated with them in their intellectual communities.
Roberto Marchionatti
3. Economics in Cambridge: Alfred Marshall, the Old Cambridge School, and Their Opponents in England
Abstract
The chapter deals essentially with economics in Cambridge, UK, with Marshall as leader of a wide community of scholars, the so-called Old Cambridge School: by the 1890s, their neoclassical thought had become the international mainstream. Marshall’s Principles, which embodied “the classical situation that emerged around 1900”, was the most complete expression of neoclassical economics. It is carefully analyzed together with Marshall’s Industry and Trade and his monetary writings. The last part of the chapter deals with the dissent against Marshall’s thinking in England: the works of Wicksteed and Hobson. Wicksteed represented a marginalist conception of economics that differed from Marshall and his followers and was more similar to that expressed by the Viennese school; Hobson was a heretic who anticipated Keynes’s theory of effective demand.
Roberto Marchionatti
4. Economics in Lausanne: Vilfredo Pareto and the Lausanne School
Abstract
This chapter deals with economics in Lausanne in Pareto’s epoch. After presenting Walras’s legacy, the methodological and analytical contribution of Pareto is discussed, starting from the articles making up the Considerazioni which provide a critical assessment of the state of the ‘new economic theories’. The analysis of the Cours d’économie politique follows: the foundation of the experimental method in economics, the restatement of pure political economy, and the examinations of many topics in applied economics. Then the Manuale di economia politica is considered: in particular, the passage from the cardinal to ordinal utility and the new formulation of general economic equilibrium. Lastly, the relationship between economics and sociology in the late Pareto is analyzed. The last part of the chapter deals with the contributions of the economists of the Paretian school.
Roberto Marchionatti
5. Economics in Berlin and Vienna: A Mosaic of Theories and Research Programs
Abstract
The chapter deals with economics in Berlin and Vienna where many original contributions in economics were made, giving rise to a confrontation between a variety of alternative approaches. First, the chapter examines economics in Berlin, where the Historical School had a well-established presence with its leader Schmoller, followed by young scholars like Sombart, Weber, and Spiethoff. Then, the development of economic thought in Vienna is analyzed, where Menger’s followers, Böhm-Bawerk and Wieser, established the Austrian School. They were followed by important scholars like Mises and Schumpeter. However, the scene was not occupied only by these actors. In both places, the intellectual richness of the environment was increased by some important Marxist and neo-Ricardian theoretical contributions by Hilferding in Vienna and Bortkiewicz in Berlin.
Roberto Marchionatti
6. Economics in the European Peripheries
Abstract
This chapter deals with economics in some European countries which represent, beyond the centers of Cambridge, Lausanne, Berlin, and Vienna, the peripheries of economic theory in the rest of Europe. Here, the theoretical thinking in economics is connected in different ways with that of the centers. It made important advances in Sweden with the work of Knut Wicksell, in the field of capital theory and monetary economics, and, to a lesser extent, Gustav Cassel. Elsewhere in Europe, economic thinking was, at the theoretical level, less original. However, to appreciate the heterogeneity and relevance of European economics as a whole in this period, three other countries are mentioned in the chapter: Italy above all, with economists like Maffeo Pantaleoni and Luigi Einaudi, followed by France and Russia.
Roberto Marchionatti
7. Economics in the United States: Between Classicism, Neoclassicism, and Institutionalism
Abstract
This chapter deals with economics in the United States where an original economic thinking of increasingly high standing emerged with the work of J. B. Clark and Fisher, together with Taussig’s important contribution in the theoretical field as well as from the organizational point of view: they constitute ‘the triumvirate’ of American neoclassical economics. Of the other figures of relevance in the world of American economics, the most important was Laughlin, leader of the Chicago economists. At a different theoretical level, we have the revolutionary work of Veblen and the early contributions of the emergent Institutionalist movement that he inspired. The chapter examines these contributions in the context of the communities where they developed. They included Columbia, Harvard, Chicago, and Yale, the main centers of economics in the United States.
Roberto Marchionatti
8. Great Controversies
Abstract
This chapter deals with some of the major controversies of the period between the last decades of the nineteenth century and the First World War. First is the methodological controversy between marginalists and neoclassicists versus historicists, from the Menger versus Schmoller Methodenstreit to the attempt at reconciliation of John Neville Keynes. Second, the chapter deals with the controversies about economics and mathematics. The chapter examines the Edgeworth-Walras-Bortkiewicz controversy on the application of mathematics to political economy of the years 1889–1891 and the debate between economists and scientists on mathematical economics in the period 1901–1914. Lastly, the chapter deals with the debate in Europe between economists and philosophers in the period 1894–1904 on Marx’s Capital, in particular, on the issue of the transformation of values into prices of production.
Roberto Marchionatti
9. The Great War and the End of an Era
Abstract
This short chapter summarizes the picture that emerges from the narrative of the evolution of economic theory in the twenty-five years preceding the Great War and emphasizes that after 1900, economic thought entered a period of transition. But the atmosphere where the interchange of economic ideas took place was dramatically altered by an event that changed the world: the Great War.
Roberto Marchionatti
Backmatter
Metadata
Title
Economic Theory in the Twentieth Century, An Intellectual History - Volume I
Author
Prof. Roberto Marchionatti
Copyright Year
2020
Electronic ISBN
978-3-030-40297-6
Print ISBN
978-3-030-40296-9
DOI
https://doi.org/10.1007/978-3-030-40297-6