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Friday, August 30, 2013

The French laissez-faire school and its influence

On the French laissez-faire school and its influence in Europe and the United States in the nineteenth century, see the seminal article by Joseph T. Salerno, ‘The Neglect of the French Liberal School in Anglo-American Economics: A Critique of Received Explanations’, Review of Austrian Economics, 2 (1988), pp. 113–56. In this important and subtle essay, Salerno corrects the conventional historical deprecation of the theoretical acumen of Bastiat and the French liberals, and demonstrates their considerable influence on nineteenth century economic theory, including the marginalists.
The only satisfactory biography of Bastiat is Dean Russell, Frédéric Bastiat: Ideas and Influence (Irvington-on-Hudson: Foundation for Economic Education, 1965). Although Russell is an admirer of Bastiat, he undervalues Bastiat's economic theory, as grossly inferior from the point of view of the Austrian School. Russell fails to take into account that Bastiat's emphasis on immaterial services rather than material goods, as well as his emphasis on consumer wants, were great steps forward toward Austrian theory as compared to dominant British classicism. More material on Bastiat's career as legislator can be found in George Charles Roche III, Frédéric Bastiat: A Man Alone (New Rochelle, NY: Arlington House, 1971), pp. 82–122. See also the discussion of Bastiat in Israel M. Kirzner, The Economic Point of View (Princeton, NJ: D. Van Nostrand, 1960), pp. 82–4. Also see Robert F. Hébert, ‘Claude Frédéric Bastiat’, New Palgrave Dictionary, I, pp. 204–5. On the international congress of economists held in Brussels, see Joseph Garnier, ‘Économistes (Congrès des)’, in C. Coquelin and C. Guillaumin (eds.), Dictionnaire d'Économie Politique (Paris: Guillaumin, 1852), I, pp. 671–2. There is no substitute for reading the delightful work of Bastiat directly; see the translations of his volumes Economic Harmonies, Economic Sophisms, and Selected Essays of Political Economy, all published by Princeton, NJ.: D. Van Nostrand, 1964.
The best discussion of Molinari is the three-part article by David M. Hart, ‘Gustave de Molinari and the Anti-statist Liberal Tradition: Part I’, Journal of Libertarian Studies, V (Summer 1981), pp. 263–90; ‘Gustave de Molinari and the Anti-statist Liberal Tradition: Part II’, Journal of Libertarian Studies, V (Autumn, 1981), pp. 399–434; and ‘Gustave de Molinari and the Anti-statist Liberal Tradition: Part III’, Journal of Libertarian Studies, VI (Winter 1982) pp. 83–104.
There are English translations of Molinari's path-breaking anarcho-capitalist work: The Production of Security (New York: Center for Libertarian Studies, May 1977) (with preface by M. Rothbard); and his Eleventh Soirée in Hart, ‘Molinari, Part III’, pp. 88–104. The only book of Molinari's translated into English came when he had already retreated from anarcho-capitalism: The Society of Tomorrow (New York: G.P. Putnam's Sons, 1904).
For an appreciative discussion of Molinari and private protection by a modern economist, see Bruce L. Benson, ‘Guns for Protection and Other Private Sector Responses to the Fear of Rising Crime’, in D. Kates (ed.), Firearms and Violence: Issues of Public Policy (San Francisco: Pacific Institute for Public Policy Research, 1984), pp. 346–56.
On the influence of Bastiat and Francesco Ferrara in Italy, and on the spread of historicism and socialism in the 1870s, see Luigi Cossa, An Introduction to the Study of Political Economy (London: Macmillan, 1893).
For an overall discussion of French academic economics in the nineteenth century, see Alain Alcouffe, ‘The Institutionalization of Political Economy in French Universities, 1819–1896’, History of Political Economy, 21 (Summer 1989), pp. 313–44.
On Francesco Ferrara and the Italian laissez-faire school, also see Ugo Rabbeno, ‘The Present Condition of Political Economy in Italy’, Political Science Quarterly, 6 (Sept. 1891), pp. 439–73; and Piero Barucci, ‘The Spread of Marginalism in Italy, 1871–1890’, in R.D.C. Black, A.W. Coats, C.D.W. Goodwin (eds.), The Marginal Revolution in Economics: Interpretation and Evaluation (Durham, NC: Duke University Press, 1973), pp. 246–66.
The best discussion of Pareto, combined with English translations of many of his articles and excerpts from his works, is in Placido Bucolo (ed.), The Other Pareto (London: Scolar Press, 1980). Also important is S.E. Finer's introduction, as well as the compilation in, Vilfredo Pareto, Sociological Writings and S.E. Finer, ‘Pareto and Pluto-Democracy:

The Retreat to Galapogos’, American Political Science Review, 62 (1968), pp. 440–50. For a current discussion see Salerno, ‘Neglect’.
On Bastiat and laissez-faire views in Sweden, see Eli F. Heckscher, ‘A Summary of Economic Thought in Sweden, 1875–1950’, The Scandinavian Economic History Review, 1 (1953), pp. 105–25. On the libertarian, laissez-faire economist John Prince Smith in Germany, see the illuminating article by Ralph Raico, ‘John Prince Smith and the German Free Trade Movement’, in W. Block and L. Rockwell (eds.), Man, Economy, and Liberty: Essays in Honor of Murray N. Rothbard (Auburn University, Ala.: The Ludwig von Mises Institute, 1988), pp. 341–51. Also see W.O. Henderson, ‘Prince Smith and Free Trade in Germany’, Economic History Review, 2nd ser., 2 (1950), rprt. in Henderson, Britain and Industrial Europe, 1750–1870 (Liverpool, 1954). On Prince Smith's associate Julius Faucher, see Andrew R. Carlson, Anarchism in Germany, Vol. I: The Early Movement (Metuchen, NJ: The Scarecrow Press, 1972), pp. 65–6. On Karl Heinrich Rau, see Keith Tribe, Governing Economy: The Reformation of German Economic Discourse 1750—1840 (Cambridge: Cambridge University Press, 1988), pp. 183–201. On Rau, also see H.C. Recktenwald, ‘Rau, Karl Heinrich’, The New Palgrave, IV, p. 96.
On German liberalism generally, see Donald G. Rohr, The Origins of Social Liberalism in Germany (Chicago: University of Chicago Press, 1963); and James J. Sheehan, German Liberalism in the Nineteenth Century (Chicago: University of Chicago Press, 1978).
On British laissez-faire theorists heavily influenced by Bastiat, Henry Dunning Macleod's work is of interest. In particular, see his The Elements of Political Economy (London: Longman, Brown, 1857); The History of Economics (New York: Putnam, 1896); and his Dictionary of Political Economy, Vol. I (London: 1863). His view of laissez-faire and of the history of economic thought is nicely summed up in his ‘On the Science of Economics and Its Relation to Free Exchange and Socialism’, in Thomas Mackay (ed.), A Policy of Free Exchange (London: John Murray, 1894), pp. 3–46. For appreciative discussions of Macleod, see Salerno, ‘Neglect’, pp. 130–32; Charles Rist, History of Monetary and Credit Theory (1940, NY: A.M. Kelley, 1966); Israel M. Kirzner, The Economic Point of View (New York: Van Nostrand, 1960), pp. 73, 202–3; and Murray N. Rothbard, ‘Catallactics’, The New Palgrave, II, p. 377.
The unjustly neglected Wordsworth Donisthorpe's work in laissez-faire economics consists of Individualism, A System of Politics (London: Macmillan, 1889), and his Law in a Free State (London: Macmillan, 1895); his waffling chapter on ‘The Limits of Liberty’ in the latter work was reprinted from his article of the same name in Thomas Mackay (ed.), A Plea for Liberty (NY: D. Appleton & Co., 1891), pp. 63–106. For a history of Donisthorpe and the British laissez-faire movement, see W.H. Greenleaf, The British Political Tradition (London: Methuen, 1983), II, pp. 263–87. Also see Edward Bristow, ‘The Liberty and Property Defence League and Individualism’, The Historical Journal, 18 (Dec. 1975), pp. 761–89; and John W Mason, ‘Thomas Mackay: The Anti-Socialist Philosophy of the Charity Organization Society’, in K.D. Brown (ed.), Essays in Anti-Labour History (London: Macmillan, 1974), pp. 307–9. For Donisthorpe's plutology, see his Principles of Plutology (London: Williams & Norgate, 1876). Also on Donisthorpe, see Peter Newman, ‘Donisthorpe, Wordsworth’, New Palgrave, I, pp. 916–7.
On William E. Hearn and economics in Australia, see Hearn, Plutology, or the Theory of the Efforts to Satisfy Human Wants (London: Macmillan, 1864); Salerno, ‘Neglect’, pp. 125–9; J.A. LaNauze, Political Economy in Australia (Melbourne: Melbourne University Press, 1949); and D.B. Copland, William E. Hearn, First Australian Economist (Melbourne: Melbourne University Press, 1935).
Joseph Dorfman's magisterial multi-volume Economic Mind in American Civilization is indispensable for any coverage of American economic thought; relevant to laissez-faire thought influenced by Bastiat are Volume II: 1606–1865 (New York: Viking, 1946), and Volume HI: 1865–1918 (New York: Viking, 1949). Also important for the nineteenth century after the Civil War is Sidney Fine, Laissez Faire and the General-Welfare State (Ann Arbor, Michigan: University of Michigan Press, 1956). Also see Salerno, ‘Neglect’, pp. 133–8; Kirzner, Economic Point of View, pp. 75–77. Amasa Walker's most important work was his The Science of Wealth (3rd ed., Boston: Little Brown, 1867); and Arthur Latham Perry's was his Political Economy (21st ed., New York: Scribner, 1892). Also see the illuminating collection of essays by Perry, Miscellanies (Williamstown, Mass.: published by author, 1902), published for the semi-centennial celebration of the Williams College class of 1852.
Charles Holt Carroll's collected essays are published in Edward C. Simmons (ed.), Organization of Debt into Currency, and Other Essays (Princeton NJ: Van Nostrand, 1964). Simmons's Introduction, ibid., pp. v-xxiv, is outstanding. Also see the reprint of Carroll's essays Congress and the Currency (James Turk, ed., Greenwich, CT: Committee for Monetary Research and Education, Sept. 1977), from Hunt's Merchant's Magazine of July 1864. For Carroll and other 100 per cent gold writers, see Skousen, Economics of a Pure Gold Standard. As Simmons points out, even Dorfman omits Carroll, while the standard histories of monetary thought in America: Mints, History of Banking Theory; and Harry E. Miller, Banking Theories Before 1860 (Cambridge Mass.: Harvard University Press, 1932), make no reference to any of Carroll's writings after the start of the Civil War.

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

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