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After Adam Smith

After Adam Smith: A Century of Transformation in Politics and Political Economy

Murray Milgate
Shannon C. Stimson
Copyright Date: 2009
Pages: 320
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  • Book Info
    After Adam Smith
    Book Description:

    Few issues are more central to our present predicaments than the relationship between economics and politics. In the century after Adam Smith'sWealth of Nationsthe British economy was transformed.After Adam Smithlooks at how politics and political economy were articulated and altered. It considers how grand ideas about the connections between individual liberty, free markets, and social and economic justice sometimes attributed to Smith are as much the product of gradual modifications and changes wrought by later writers.

    Thomas Robert Malthus, David Ricardo, James Mill, John Stuart Mill, and other liberals, radicals, and reformers had a hand in conceptual transformations that culminated in the advent of neoclassical economics. The population problem, the declining importance of agriculture, the consequences of industrialization, the structural characteristics of civil society, the role of the state in economic affairs, and the possible limits to progress were questions that underwent significant readjustments as the thinkers who confronted them in different times and circumstances reworked the framework of ideas advanced by Smith--transforming the dialogue between politics and political economy. By the end of the nineteenth century an industrialized and globalized market economy had firmly established itself. By exploring how questions Smith had originally grappled with were recast as the economy and the principles of political economy altered during the nineteenth century, this book demonstrates that we are as much the heirs of later images of Smith as we are of Smith himself.

    Many writers helped shape different ways of thinking about economics and politics after Adam Smith. By ignoring their interventions we risk misreading our past--and also misusing it--when thinking about the choices at the interface of economics and politics that confront us today.

    eISBN: 978-1-4008-3101-2
    Subjects: Economics, Political Science

Table of Contents

  1. Chapter One INTRODUCTION
    (pp. 1-9)

    This book considers a number of the key political and economic themes and concepts that emerged in the early period of political economy up to the final quarter of the nineteenth century. We trace the manner in which a systematic interrelationship between politics and political economy was developed, altered, and refined in those years. Many writers and many circumstances contributed to the formation and development of politics and political economy. Who these writers were, what contexts might be useful in understanding their ideas, and how those ideas shaped the discourse of politics and political economy form the object of our...

    (pp. 10-32)

    In march 2007, the Bank of England issued a new twenty-pound banknote featuring Smith’s image. The image was taken from a likeness of the portrait medallion of Smith (a three-inch bust in two states, done from life) by James Tassie and dated 1787, making Smith sixty-four years of age. It is now housed in the Scottish National Portrait Gallery in Edinburgh.¹ Smith, of course, has not lacked for literary portraitists. If one turns to the literature of political and economic thought, one will find little unanimity as to how we are to render his contribution.

    The first such sketch, drawn...

    (pp. 33-59)

    In 1767, at the age of forty-four and in the middle of his tenure as the chair of moral philosophy at Edinburgh that helped cement that institution’s international reputation as the seat of the Scottish Enlightenment, Ferguson published hisEssay on the History of Civil Society. Much admired by later classical economists, this work set down in clear and unambiguous terms many of the hallmarks of that tradition. One need only mention his discussion of the division of labour, the character of economic progress, and the class structures embedded in the emerging capitalist economy to appreciate the attractions they found...

    (pp. 60-76)

    Marx once famously claimed that the economic structure of a society constituted the foundation of almost everything: law, politics, religion, history, and consciousness itself. It was, as he put it, the “real foundation” on which was built a legal and political “superstructure”—and to which there corresponded “definite forms of social consciousness” (1858, 20– 21). On his line of thinking, political life was epiphenomenal—reproducing and preserving the social and economic relations of production from which it emerged. Yet Marx was by no means the first, nor the last, to contemplate the relationship between economic and political life. It is...

    (pp. 77-96)

    Robert Boyle, justly famous for many things, once likened the eye of a fly to an ingeniously produced machine. In saying this, although perhaps without knowing it, he had given expression to a worldview that by then, had come to be shared by the scientific community. It was a worldview that had developed and flourished in the works of some of the greatest minds of the age. Theirs are names to conjure with: Copernicus, Kepler, Galileo, Descartes, Huygens, Leibniz, and Newton. It was a simple and powerful worldview—namely, that the varied phenomena of nature were linked and organised by...

  6. Chapter Six THE FIGURE OF SMITH
    (pp. 97-120)

    Consider the figure of smith: architect of economic liberalism, champion of free trade, founding father of economics, advocate of the benefits of unregulated competition, prophet of fiscal responsibility and monetary restraint, and perhaps above all, defender of the freedom of the individual to pursue their own economic self-interest without interference from government. It is not difficult to believe that at the bicentenary of the publication of theWealth of Nations, Stigler quipped that Smith was alive and well, and living in Chicago (see Meek 1977, 3). At the same time, however, Winch was moved to remark that since economists were...

    (pp. 121-138)

    The introduction of the principle of population into British political economy in the late 1790s marked the most significant transformation that occurred in the subject as it moved into the nineteenth century. It could not have been more influential—not only for the political implications of political economy but also for the understanding of its social and moral content. Where once the populousness of a nation was thought of as a measure of its health, as a beacon of its prosperity and fecundity, the principle of population called this into question.¹ Furthermore, it sent a new and ominous message concerning...

    (pp. 139-159)

    Between 1751 and 1806, the population of England nearly doubled.¹ This dramatic demographic change presented new challenges both to political economists and political thinkers within the nation. An earlier confidence in the connection between a growing population and rising economic prosperity—a confidence that theWealth of Nationswas taken to reinforce—subsided. In its place arose growing fears of the social, civil, and political dangers that might be posed by a restless labouring population. In the hands of some, the Malthusian principle of population provided an analytical framework from which to consider these economic, moral, and political consequences.² It...

    (pp. 160-185)

    When Smith had written elliptically of the importance of “general principles” to the “science of the legislator” (1776, 4.2:468), Stewart took him to mean that the science of political economy furnished those general principles. As a result, Stewart concluded that while the findings of political economy might be used as a guide to economic policymaking, they had nothing to say (especially in the aftermath of the French Revolution) about the constitution of political society. This conception of the relationship between economics and politics has been handed down to practicing economists pretty well intact—despite the fact that Smith’s economics has...

    (pp. 186-216)

    When Thomas more punned on the Greekeutopia(εύ + τὀπoς ) or “good place,” to give us the wordutopia(oύ + τὀπoς) or “no place”—but a good no place nonetheless—he could scarcely have imagined the longevity it would enjoy. Whether his particular utopia charted the landscape of a secret inner life transcending actual life in the real states of the sixteenth century, or whether it was framed under the influence of an Augustinian dialectic between a depraved individualism and an ideal community of the city of God, is difficult to say. What is clear, however, is...

  11. Chapter Eleven LABOUR DEFENDED
    (pp. 217-236)

    By the early 1820s, the often violent mass agitations that had accompanied the years immediately following the conclusion of the Napoleonic Wars had given way to a period of relative economic calm in Britain. Under the stewardship of the then chancellor of the Exchequer Frederick Robinson—or “Prosperity Robinson,” as he came to be known—it appeared that the memory of events like the massacres at Peterloo in 1819 and the spectacle of the public execution of some of the Cato Street conspirators in 1820 had been eclipsed.¹ But it was only temporarily so, and by the middle of the...

    (pp. 237-257)

    Hayek once drew a sharp distinction between what he called a “false” rationalistic individualism, as exemplified (he claimed) by the English utilitarians and the French physiocrats, and a “true” antirationalistic individualism that he associated with Ferguson, Smith, Burke, and Tocqueville.To false individualism, Hayek attributed illiberal political tendencies, while to true individualism he attributed genuine political liberty. What is interesting about Hayek’s dichotomy is that it located John Stuart Mill in both camps (1946, 11, 28) and accurately recognised the existence of a disjuncture in Mill’s discussion of liberty. Of course, according to Hayek, Mill’s opinions were to be understood as...

    (pp. 258-268)

    The condition in which Mill had left politics and political economy in the middle of the nineteenth century was somewhat unsatisfactory. But this state of affairs did not owe its existence to the fact that Mill had admitted exceptions (often numerous) to almost every principle of his political economy—not least to the general presumption in favour of laissez-faire. It instead arose from the unequal weight that Mill had given to political as opposed to economic considerations in supporting it. As far as laissez-faire had a theoretical foundation at all in Mill, it was located in a quite sophisticated application...