The Ordinary Business of Life: A History of Economics from the Ancient World to the Twenty-First Century

The Ordinary Business of Life: A History of Economics from the Ancient World to the Twenty-First Century

by Roger E. Backhouse
     
 

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ISBN-10: 0691116296

ISBN-13: 9780691116297

Pub. Date: 03/01/2004

Publisher: Princeton University Press

In some of Western culture's earliest writings, Hesiod defined the basic economic problem as one of scarce resources, a view still held by most economists. Diocletian tried to save the falling Roman Empire with wage and price fixes—a strategy that has not gone entirely out of style. And just as they did in the late nineteenth century, thinkers trained in

Overview

In some of Western culture's earliest writings, Hesiod defined the basic economic problem as one of scarce resources, a view still held by most economists. Diocletian tried to save the falling Roman Empire with wage and price fixes—a strategy that has not gone entirely out of style. And just as they did in the late nineteenth century, thinkers trained in physics renovated economic inquiry in the late twentieth century. Taking us from Homer to the frontiers of game theory, this book presents an engrossing history of economics, what Alfred Marshall called "the study of mankind in the ordinary business of life."

While some regard economics as a modern invention, Roger Backhouse shows that economic ideas were influential even in antiquity—and that the origins of contemporary economic thought can be traced back to the ancients. He reveals the genesis of what we have come to think of as economic theory and shows the remarkable but seldom explored impact of economics, natural science, and philosophy on one another. Along the way, he introduces the fascinating characters who have thought about money and markets, including theologians, philosophers, politicians, lawyers, and poets as well as economists themselves. We learn how some of history's most influential concepts arose from specific times and places: from the Stoic notion of natural law to the mercantilism that rose with the European nation-state; from postwar development economics to the recent experimental and statistical economics made possible by affluence and powerful computers.

Vividly written and unprecedented in its integration of ancient and modern economic history, this book is the best history of economics—and among the finest intellectual histories—to be published since Heilbroner's The Worldly Philosophers. It proves that economics has been anything but "the dismal science."

Product Details

ISBN-13:
9780691116297
Publisher:
Princeton University Press
Publication date:
03/01/2004
Edition description:
New Edition
Pages:
384
Sales rank:
154,948
Product dimensions:
5.00(w) x 8.02(h) x 1.11(d)

Table of Contents

Acknowledgements x
Prologue 1
The History of Economics 1
What is Economics? 3
Viewing the Past through the Lens of the Present 6
The Story Told Here 8

1.The Ancient World 11
Homer and Hesiod 11
Estate Management—Xenophon's Oikonomikos 13
Plato's Ideal State 18
Aristotle on Justice and Exchange 19
Aristotle and the Acquisition of Wealth 22
Rome 25
Conclusions 27

2.The Middle Ages 29
The Decline of Rome 29
Judaism 31
Early Christianity 33
Islam 35
From Charles Martel to the Black Death 39
The Twelfth-Century Renaissance and Economics in the Universities 41
Nicole Oresme and the Theory of Money 47
Conclusions 49

3.The Emergence of the Modern World View—the Sixteenth Century 51
The Renaissance and the Emergence of Modern Science 51
The Reformation 54
The Rise of the European Nation State 56
Mercantilism 57
Machiavelli 59
The School of Salamanca and American Treasure 60
England under the Tudors 62
Economics in the Sixteenth Century 64

4.Science, Politics and Trade in Seventeenth-Century England 66
Background 66
Science and the Scientists of the Royal Society 67
Political Ferment 73
Economic Problems—Dutch Commercial Power and the Crisis of the 1620s 76
The Balance-of-Trade Doctrine 77
The Rate of Interest and the Case for Free Trade 79
The Recoinage Crisis of the 1690s 84
Economics in Seventeenth-Century England 87

5.Absolutism and Enlightenment in Eighteenth-Century France 89
Problems of the Absolute State 89
Early-Eighteenth-Century Critics of Mercantilism 91
Cantillon on the Nature of Commerce in General 94
The Enlightenment 99
Physiocracy 100
Turgot 104
Economic Thought under the Ancien Régime 109

6.The Scottish Enlightenment of the Eighteenth Century 110
Background 110
Hutcheson 112
Hume 114
Sir James Steuart 117
Adam Smith 121
Division of Labour and the Market 123
Capital Accumulation 126
Smith and Laissez-Faire 127
Economic Thought at the End of the Eighteenth Century 130

7.Classical Political Economy, 1790-1870 132
From Moral Philosophy to Political Economy 132
Utilitarianism and the Philosophic Radicals 136
Ricardian Economics 137
Alternatives to Ricardian Economics 141
Government Policy and the Role of the State 147
Money 150
John Stuart Mill 153
Karl Marx 156
Conclusions 164

8.The Split between History and Theory in Europe, 1870-1914 166
The Professionalization of Economics 166
Jevons, Walras and Mathematical Economics 167
Economics in Germany and Austria 173
Historical Economics and the Marshallian School in Britain 177
European Economic Theory, 1900-1914 182

9.The Rise of American Economics, 1870-1939 185
US Economics in the Late Nineteenth Century 185
John Bates Clark 187
Mathematical Economics 190
Thorstein Veblen 195
John R. Commons 198
Inter-War Pluralism 201
Inter-War Studies of Competition 202
The Migration of European Academics 207
US Economics in the Mid Twentieth Century 209

10.Money and the Business Cycle, 1898-1939 211
Wicksell's Cumulative Process 211
The Changed Economic Environment 214
Austrian and Swedish Theories of the Business Cycle 217
Britain: From Marshall to Keynes 219
The American Tradition 224
Keynes's General Theory 228
The Keynesian Revolution 232
The Transition from Inter-War to Post-Second World War Macroeconomics 235

11.Econometrics and Mathematical Economics, 1930 to the Present 237
The Mathematization of Economics 237
The Revolution in National-Income Accounting 240
The Econometric Society and the Origins of Modern Econometrics 245
Frisch, Tinbergen and the Cowles Commission 248
The Second World War 252
General-Equilibrium Theory 254
Game Theory 262
The Mathematization of Economics (Again) 265

12.Welfare Economics and Socialism, 1870 to the Present 269
Socialism and Marginalism 269
The State and Social Welfare 271
The Lausanne School 274
The Socialist-Calculation Debate 275
Welfare Economics, 1930-1960 279
Market Failure and Government Failure 282
Conclusions 284

13.Economists and Policy, 1939 to the Present 288
The Expanding Role of the Economics Profession 288
Keynesian Economics and Macroeconomic Planning 290
Inflation and Monetarism 295
The New Classical Macroeconomics 298
Development Economics 301
Conclusions 306

14.Expanding the Discipline, 1960 to the Present 309
Applied Economics 309
Economic Imperialism 311
Heterodox Economics 313
New Concepts and New Techniques 317
Economics in the Twentieth Century 321

Epilogue: Economists and Their History 325
A Note on the Literature 329
References 344
lndex 353

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