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Saturday, August 24, 2013

David Ricardo and the Ricardian system

The literature on Ricardo and Ricardianism is almost as enormous as on Smith, and so it must be winnowed judiciously here. All of Ricardo's works and correspondence are collected in the definitive eleven-volume labour-of-love edition edited by the left-Ricardian neo-Marxist Piero Sraffa, The Works and Correspondence of David Ricardo (Cambridge: Cambridge University Press, 1951–55). There are no satisfactory biographies of Ricardo; the only one available is the chatty family history by David Weatherall, David Ricardo (The Hague: Martinus Nijhoff, 1976). The best explanation and critique of the Ricardian system is Oswald St Clair, A Key to Ricardo (1957, New York: A.M. Kelley, 1965). There are brilliant insights into Ricardo and Ricardianism scattered, in disorganized fashion, throughout  Schumpeter's History of Economic Analysis; indeed, much of his History may be interpreted as a devastating assault on Ricardianism. For a properly acidulous view of Ricardianism, see also Frank H. Knight, ‘The Ricardian Theory of Production and Distribution’, in On the History and Method of Economics (Chicago: University of Chicago Press, 1956), pp. 37–8. Not surprisingly, some of the critiques of Adam Smith's theory apply also to Ricardo; see, in particular, Cannan's subtle A History of the Theories of Production & Distribution (3rd ed., London: Staples Press, 1917); Gray's sardonic and delightful The Development of Economic Doctrine (London: Longmans, Green, 1931); Douglas's lucid and trenchant ‘Smith's Theory of Value and Distribution’; Ellen Paul's forceful and perceptive Moral Revolution and Economic Science (Westport: Conn.: Greenwood Press, 1979); and Richard H. Timberlake Jr's ‘The Classical Search for an Invariable Measure of Value’, Quarterly Review of Economics and Business, 6 (Spring 1966), pp. 37–44. For a demonstration of the crucial importance to the Ricardian system – in contrast to Smith – of the quantity-of-labour theory of value, see L.E. Johnson, ‘Ricardo's Labor Theory of the Determinant of Value’, Atlantic Economic Journal, 12, (March 1984), pp. 50–59.
Unlike Adam Smith, David Ricardo has fortunately not been the recent recipient of a centennial-type boost to his reputation. But the indefatigable Samuel Hollander was of course there, as in the case of Smith, torturing Ricardo into the mould of a modern general-equilibrium theorist. Samuel Hollander, The Economics of David Ricardo (Toronto: The University of Toronto Press, 1979).
In recent articles Terry Peach has set forth a masterful defence of the ‘traditionalist’ view of Ricardo presented in this work, as well as a critique of the ‘corn model’ interpretation of Ricardo offered by Sraffa, and of the opposing Hollander proto-general equilibrium approach. In particular, Peach shows that Ricardo was marked by an increasingly intensified labour theory of value, an overriding concentration on the long-run equilibrium ‘natural price’, on very rapid increases of population returning the economy to long-run equilibrium, and by a total neglect of the role of demand in price as well as of the role of scarcity in determining the supply of reproducible goods. See in particular, Terry Peach, ‘David Ricardo: A Review of Some Interpretative Issues’, in William O. Thweatt, (ed.), Classical Political Economy: A Survey of Recent Literature (Boston: Kluwer, 1988) pp. 103–31. Also see Peach, ‘David Ricardo's Treatment of Wages’, in R.D.C. Black (ed.), Ideas in Economics (London: Macmillan, 1986).
The last effusion of the orthodox Keynesian view of the alleged triumph of Ricardianism in Britain is Sydney G. Checkland, ‘The Propagation of Ricardian Economics in England’, Economica, n.s., 16 (Feb. 1949), pp. 40–52. Revisionism of this view began with Ronald L. Meek, ‘The Decline of Ricardian Economics in England’, Economica, n.s. 17 (Feb., 1950), pp. 43–62, continued through Schumpeter's History and culminated in two excellent articles: Frank W. Fetter, ‘The Rise and Decline of Ricardian Economics’, History of Political Economy, 1 (Spring 1969), pp. 67–84; and Barry Gordon, ‘Criticism of Ricardian Views on Value and Distribution in the British Periodicals, 1820–1850’, History of Political Economy, 1 (Autumn 1969), pp. 370–87. The anti-Say's law underworld in Britain is explored in Barry J. Gordon, Non-Ricardian Political Economy: Five Neglected Contributions (Boston: Harvard Graduate School Baker Library, 1967).
Whenever any hint appears deprecating either the wisdom or the majesty of David Ricardo we can depend upon Samuel Hollander to enter the fray in combat; and, sure enough, Hollander weighs in with the maverick view that simply everyone was a Ricardian. Samuel Hollander, ‘The Reception of Ricardian Economics’, Oxford Economic Papers, 29 (July 1977), pp. 221–57.

Austrian Perspective on the History of Economic Thought (2 volume set)

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