Abstract
This chapter deals with Hermann Heinrich Gossen’s doctrine set out in his book Entwickelung der Gesetze des menschlichen Verkehrs und der daraus fließenden Regeln für menschliches Handeln (1854). Furthermore, I present the few facts known about the course of his life. The book consists of a positive part and a normative part. Its most prominent elements are two assertions now known as Gossen’s first law and second law. These two laws will be discussed extensively, together with the rest of his positive theory. Among this rest, one may notice what might be called “Gossen’s third law”. Then follows a short exposition of the politico-economic propositions he deduced from his theory. In spite of his proposal in favour of State ownership of all the land, these propositions appear to be of a liberal nature. The paper ends with some remarks on evolutionary features of Gossen’s thought.
Centre Walras, Triangle, Université Lyon–2, France. An earlier version of this chapter appeared, in Dutch, in: G. van der Laan et al. (red.), Econometrie in beweging. Bundel bij het afscheid van prof. dr. A.H.Q.M. Merkies, Vrije Universiteit, Amsterdam, 1997, pp. 63-78. This Festschrift was presented to Nol Merkies at the occasion of his 65th birthday and retirement as professor of econometrics. I thank him for his consent to use the Dutch version as a basis for an enlarged English version and for his many useful suggestions. Likewise, I thank Yukihiro Ikeda (Keio University, Tokio), Hans Maks (Maastricht) and Paola Tubaro (University of Greenwich) for their good comments.
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- 1.
Translated into English under the title The laws of human relations and the rules of human action derived therefrom, by Rudolph Blitz, with an introductory essay by Nicholas Georgescu-Roegen, The MIT Press, Cambridge, 1983; the English translations of German citations are taken from this book.
- 2.
The magnitude [intensity] of pleasure decreases continuously if we continue to satisfy one and the same enjoyment without interruption until satiety is ultimately reached (1983: 6). (See also note 13.) The expressions between square brackets have been inserted by the translator, just as in the subsequent quotations from Blitz’s translation.
- 3.
Man obtains the maximum of life pleasure if he allocates all his earned money E between the various pleasures (…) in such a way that the last atom of money spent for each pleasure offers the same amount [intensity] of pleasure (1983: 108–109).
- 4.
One might call this the “law of increasing relative satiation” because it means that a person possessing a certain good and wanting to exchange some of it against one unit of another good while keeping his utility at the same level has to give up the more of the first good the more he initially possessed.
- 5.
Walras (1965), Letter 417. Walras kept all the letters he received and copies of all he sent out.
- 6.
In a first note, Kautz wrote (my translation) “Recently Fr. [sic] Gossen tried to present a veritable theory and philosophy of pleasure [des Genusses] (and even on a mathematical basis!) in his book Entwickelung der Gesetze des menschlichen Verkehrs, 1854 (pp. 1–45 ff.).” In a second note on the same page, “Gossen remarks (o.c. p. 2): that all individuals always try to maximise their pleasure and that this has been established in human nature by God himself as the eventual life purpose of Man.” It is not amazing that this arose Jevons’s curiosity. So it seems that Gossen has been saved from total neglect by Kautz’s two remarks on the one hand, and, on the other, by the fact that Adamson was very well-read in German economic literature and happened to know Jevons’s Theory. According to Jürg Niehans (1987), these footnotes and another equally scanty one in a book by F.A. Lange (1875) are the only references to Gossen before Jevons and Walras did justice to him. See also Kurz (2008 and 2009) and Ikeda (2000).
- 7.
- 8.
The original text of this note is lost. There are two French translations, both made by Walras, a “spontaneous” and a “revised” one. The latter can be found in Walras’s Études d’économie sociale (1990: 473–482). The former has recently been unearthed (its existence was even unknown until then) and has been published along with the French translation of Gossen’s book (1995: 41–58). In the spontaneous version, some less mild judgements about Gossen can be found. These have been replaced by euphemisms in the revised one (The word “lazy”, for instance, became “a little indolent sometimes”.).
Around 1900, some German scholars studied the texts written by Gossen for the examinations he had to pass for obtaining a higher rank. They also studied the official reports on him. However interesting, this did not yield much news in comparison to what can be found in Kortum’s note. Unfortunately, all this material was lost during the two world wars. Then, or before these wars already, nearly all traces that could directly witness of Gossen’s existence disappeared: his birthplace, his grave and his personal belongings, such as his violin, his notes for and fragments of a book on music and his texts on life insurance. See Georgecu-Roegen’s essay in Gossen (1983): xxvii ff. Gossen’s birth certificate, however, is still kept in the town hall of Düren; it has been reproduced in Gossen (1995), p. 39.
- 9.
Man wants to enjoy life and make it his goal to increase pleasures enjoyed throughout life to the highest possible level (1983: 3).
- 10.
At most an indirect influence; see “Introduction des éditeurs” in Gossen (1995), pp. 1–29.
- 11.
Claudius Hadrien Helvétius (1715–1771), French philosopher, atheist, is considered as a “materialist” believing that self-interest is one of Man’s principal motives. Helvétius was a collaborator of the Encyclopedie. He emphasised the importance of education of Man.
- 12.
The title of the English translation is The laws of human relations and the rules of human action derived therefrom.
- 13.
At the concerning places in the English translation of the Entwickelung, Bliss always added the word “intensity”, between square brackets. See, e.g. footnote 2, above. In editing Walras’s translation of Gossen’s book (Gossen 1995), we brought in similar insertions where necessary.
- 14.
Freely adapted from Pareto’s terminology (Pareto 1909: 170–171).
- 15.
In such a manner that the magnitude [intensity] of each single pleasure at the moment when its enjoyment is broken off shall be the same for all pleasures (1983: 14).
- 16.
Gossen’s notation is confusing. Here, the symbol E indicates an interval of time; elsewhere in the book, it is used to indicate subsequently total work exerted, income and savings in the land-nationalisation plan. Throughout the whole book, he changes the meaning of certain symbols (see the alphabetical indexes in Gossen 1983, 1995). This detracts the reader from the otherwise well-organised, albeit a little diffuse and bizarre presentation. Each geometrical explication is followed by a “translation” into algebra, which, in its turn, is followed by one or more tables in which the matter is once more presented for certain numerical choices of the parameters of the problem in question (for those who know neither geometry, nor algebra).
- 17.
Here, he was walking on slippery ground. He considered the period in question as consisting of a large number of “atoms of time” and supposed that each atom of a good is consumed in exactly one atom of time. This “permitted” him to “generalise” figures such as Fig. 14.3 above. Fortunately, he did not go till the dead end of this dubious path of antiquated atomism and found a better basis for making goods comparable, namely labour time, as will be set out below.
- 18.
How is exchange to be arranged so that a maximum of [total] value will result (1983: 100)?
- 19.
In order that a maximum of [total] value be achieved through exchange, it is necessary that after its completion, each commodity be distributed among all individuals in such a way that the last atom of each commodity received by every individual will create for him the same pleasure as the last atom of the same commodity received by every other individual (ibid.).
- 20.
- 21.
‘Given that the individuals do not have all the same, linear utility function.
- 22.
Hence, this exchange, however well defined (…), is an operation by which the satisfaction of (…) the exchangers taken together is brought to an absolute maximum and not to a relative one, because the quantities possessed of the commodities have not been taken into account. In other words, abstraction has been made of each exchanger’s right of property on his merchandise. This is a communist exchange: it can certainly not take place otherwise than by the authority of the State and it will bring about the equality that results simultaneously from the equality of the needs and that of the means to satisfy them. It functions in the domain of the fraternity (See also Wicksell 1954: 19, Berthoud 1988, and Lallement 1988).
- 23.
- 24.
Every individual, regardless of his status, will, by and large, take custom, as it has developed among people of his own class, as a guideline in the conduct of his own affairs (1983: 150).
- 25.
David Levy brought me upon the idea of this paragraph.
- 26.
Humanity can increase its welfare only if the single individual succeeds (1) in increasing the absolute magnitude of pleasures, (2) in increasing the capacity for work and the efficiency in its use, (3) in increasing the vital forces [life expectancy] and (4) in strengthening law and order (…).
To help humanity attain the highest possible state of bliss, full attention must be paid to these matters. To achieve the goal, we must attempt to remove obstacles that confront the individual in the choice of the most promising field of production and in spending his money without any constraints (1983: 144).
- 27.
Gossen seems sometimes only to consider independently working labourers (1854: 121).
- 28.
Walras must have been very amazed when finding systematically worked out his own scheme for land reform, advanced from the beginning of his career onwards (1859; see Walras 1881). Jevons did not inform him on this point, because Adamson only translated some parts of the book.
- 29.
There is nothing further wanting in the world to make it a perfect paradise (1983: 298).
- 30.
The sole and irresistible force by which humanity may progress in the arts and science for both its material and intellectual welfare (1983: 299).
- 31.
Mankind, once you have recognised completely and entirely the beauty of this plan of the Creation, steep yourself in adoration of the Being, which in its incomprehensible wisdom, power, and goodness has been able, by means apparently so insignificant, to bring about on your behalf something so enormously incalculably beneficial. Make yourself worthy of all that this Being has showered upon you, organising your actions for your own benefit in such a manner that this most desirable result is brought about as quickly as possible! (1983: 299).
- 32.
See also Steiner (2010), who went more deeply into this element of Gossen’s work.
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van Daal, J. (2012). The Entwickelung According to Gossen. In: Backhaus, J. (eds) Handbook of the History of Economic Thought. The European Heritage in Economics and the Social Sciences, vol 11. Springer, New York, NY. https://doi.org/10.1007/978-1-4419-8336-7_14
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