Before the publication of Ronald Coase’s “The Nature of the Firm,” new developments in the theory of the firm were under way in the works of Arnold Plant at the LSE, and Dennis Robertson, Frederick Lavington, and Austin Robinson among the Cambridge Marshallians. Although in disagreement on industrial policy, these economists shared the belief that the common view that bigger firms are always more efficient—a very popular view within the movement for industrial ‘rationalization’—was untenable from a theoretical point of view. In the works of these economists the ‘make or buy’ scheme is sometimes employed, and Coase’s idea of a cost for using the market can be found, in implicit form, in some writings of Plant that appeared before Coase’s article. But the fundamental principle that we now call “transaction costs” was hardly of any help to any of those who, at Cambridge as well as at the LSE, were insisting on the costs of coordination as a limit to the growth of the firm.

I wrote this address during the first weeks of the murderous and devastating invasion of Russia in Ukraine, in a fluctuating mood of anger and sadness. My aim was addressing the issue of the use of history to legitimize ideology, and I was contemplating how I could convince you of the urgency of this issue, and then this war broke out.

Among the most controversial of David Ricardo's contributions to policy debate was his scheme for the redemption of the public debt by means of a “capital levy,” a one-time tax on the property of the nation. Public debt policy had been the subject of sporadic debate throughout the eighteenth century, but faced increased scrutiny by the time Ricardo came to address the subject. While government revenues were suffering from the repeal of the temporary income tax which had been imposed during the Napoleonic Wars, revenue requirements remained high, as the savings in terms of military expenditures were being offset by the need to make interest payments on a debt which had grown during the latter years of the war. Ricardo's analysis of public debt was not novel; nor was the proposal for a capital levy to achieve its redemption.

Most historians know Robert Lowe (1811–1892) as W. E. Gladstone's first Chancellor (1868–73) and the leading orator against the Reform Bill of 1867. Educationists to this day criticize or praise his Revised Code of 1862, which introduced payment by results in schools. Historians of economic thought add Lowe's critique of relativism (evinced by his views on Ireland) and his stridently classical statements of the role of political economy from his later dispute with the English historical school.

In 1951, Nobel Laureate Wassily Leontief put his finger on what was wrong with economics. It had remained a “deductive system resting upon a static set of premises,” when what was needed was an economics that would “combine economic facts and theory.” The new economics would be called “interindustry” or “input-output” analysis (Leontief 1966, p. 14). According to Leontief it is easy to “compute the complete table of input requirements at any given level of output, provided we know its input ratios.” These input ratios could be calculated from “engineering data on process design and operating procedure” (ibid., pp. 24–26). For Leontief and, I suspect, a large number of economists in 1951, the technological facts dependent only on the chemical and physical laws of nature—what I shall call “Leontief coefficients”—were indisputable. It would take so many units of coke to produce a ton of pig iron whether or not there was a human being alive on earth to witness that transformation. The Leontief coefficients were the bedrock of subsequent economic analysis. They were analogous to what the philosopher John R. Searle has termed “brute facts” (Searle 1995, p. 27).

When William Stanley Jevons first presented his theory of exchange, he used the example of two trading bodies (A and B) holding stocks of corn and beef (goods X and Y), but he was eager to show how the basic results could be applied to a variety of situations. After considering the relatively simple introduction of transport costs, Jevons added three subsections (Jevons 1957, pp. 111–19) which demonstrated his confident handling of his approach. There have been many critical comments on Jevons's handling of mathematics, including those of Alfred Marshall in his review of the Theory of Political Economy (Jevons 1872; see Black 1981). However, these examples show that Jevons produced a clear and succinct statement of the mathematical structure of the theory of exchange.

Everyone has to eat, so agriculturalists must produce enough to feed themselves and the rest of the population. This statement is trivially obvious but making it explicit mattered to the early development of economic thinking. Many important economic writers of the period (Petty, Cantillon, Hutcheson, Hume, Steuart, Mirabeau, Smith, and others) used a specific notion of agricultural surplus of the form: x men can feed y, where y > x. A series of questions about the relation between agriculture and the rest of the economy naturally follows. Will the surplus be produced? How does it reach those who consume it? What are the “superfluous hands” (in Hume’s terms) to do? This paper points out this neglected theme in early economics.

Roger Backhouse (Backhouse 2004) has provided both an insightful deconstruction of dissent and a suggested terminology to deal with subtle distinctions within the domain of dissent, especially regarding the status of heterodoxy. There is more to be said, largely in expansion of his analyses—placing his analyses in a larger context. Section I summarizes Backhouse's position and Section II presents my own thoughts.

Like other Progressive Era reformers, Thomas Nixon Carver promoted a form of biology-infused social science that included both eugenics and a strong version of hereditarianism. Carver was also a charismatic teacher who trained several generations of economists and sociologists at Harvard. In this paper we will focus on the contribution of three of them: James A. Field, Norman E. Himes, and Carl S. Joslyn. These authors differ in terms of style, method, and emphasis—with Field and Himes more interested in population and birth control issues, and Joslyn in the dynamics of social stratification. As it will be shown below, however, all of them reveal an explicit commitment to hereditarianism and eugenics, which can be directly traced back to Carver’s influence during their student days at Harvard.

It is not every literary novice, blushing diffidently over her first manuscript, who easily finds a publisher, still less one prepared to pay an advance of several million pounds. But not every first author has such a story to tell as Margaret Thatcher, the longest-serving British prime minister of the twentieth century. It was the previous record holder, Asquith, who first established the notion that retired prime ministers write their memoirs, and he did so under a twin motivation which was not peculiar to himself. He sought vindication and he was after the money.

As with most papers written for occasions of this kind, this one has elements of self-indulgence. In this Society, at least, one has a captive audience, some (or most?) of whom may have come for another purpose. At the same time, one has no prescribed theme: if one had one, one organised last year's meeting around it. True, there are constraints: it is after all the History of Economics Society, which constrains the subject somewhat–but only a little; it is an after dinner speech at the end of two long days of meetings, which limits the heaviness of the contents; and it will appear in the Bulletin, which prevents complete absurdities. Yet these constraints are fairly minimal.

About three lines into his book Making Natural Knowledge, Jan Golinski defines the “constructivist” view of science as “that which regards scientific knowledge primarily as a human product, made with locally situated cultural and material resources, rather than as simply the revelation of a pre-given order of nature” (Golinski 1998, p. ix). Having a pretty good idea of what Professor Golinski's book was going to be about, this stopped me for a moment. Is that all there is to it? Is that what the work of the Strong Programme, Latour, Pickering, Knorr-Cetina; the talk of mangle, black boxes and resistances, is all about? Described this way, it seems quite reasonable; a way of thinking about scientific activity that should at least be given a hearing. Admittedly, I have seen other, usually more prolix, ways of characterizing what Golinski has called the constructivist view of science. But I like this one. It sends what I believe to be the correct message that this “constructivism” is, at its heart, better characterized as plausible and intriguing than outrageous, and that it is not necessarily threatening to any core values held by historians.

Academic economists tend to come in two varieties. One type identifies a substantive specialism at the outset of a career and continues to cultivate it. A second type is more likely to respond to the American Economic Association's twice-a-decade requests for information about sub-specialties by providing a number of differing answers over the course of a professional lifetime. I accept Adam Smith's arguments about the gains from specialization arising from a widened division of labor, but I am also conscious that Smith held that excessive specialization could contribute to boredom in the workplace. In any event, I am temperamentally a Type II economist who has greatly enjoyed working on diverse scholarly topics. I am also aware of a number of turning points that have conditioned my world with consequences that I could not have foreseen.

Clarence Ayres was a strong dissenting voice in US economics during the twentieth century. In the 1930s, a debate between Ayres and Frank Knight was published by the International Journal of Ethics. Although the debate focused on ethics, the evolution of economics was also discussed. This paper proposes an understanding of Ayres’s ideas based on the context in which he made them. This context is defined by the 1930s Ayres-Knight debate and the archival correspondence between Ayres and Knight during the 1930s.

Some years ago, George J. Stigler reminded the community of historians of economic thought that a great thinker of the last century, Adolphe Quetelet, had made a real methodological breakthrough in the social sciences by opening the door to quantification. Stigler himself tried to implement this method in the history of economic thought.

As is well-known, Karl Marx distinguished three types of rent. In addition to two categories of differential rent, closely related to the Ricardian extensive and intensive margins, he argued (against David Ricardo) that rent was paid on the least fertile land. For Marx this so-called “absolute rent” resulted from the barrier posed by landed property to the free movement of capital into agricultural production. Since the organic composition of capital was relatively low in agriculture, the prices of production of farm products were lower than their labor values. The existence of private property in land prevented the reduction of agricultural prices to these prices of production, and allowed the payment of rent even on what could be described, in Ricardian terms, as marginal land. There exists a sizeable literature on Marx's theory of absolute rent,1 but there is no systematic account of its gestation and development. In this paper we explain how Marx's critique of Ricardian rent theory evolved between his first doubts early in 1851 and the articulation of a distinctive alternative analysis in the manuscripts of 1862–63. We also assess the influence exerted on Marx by Richard Jones and Johann Karl Rodbertus, and briefly discuss the significance of Marx's theory of absolute rent for his political economy as a whole.