Abstract
What I have to say about Alfred Marshall is very different from what you read in the literature, either in brief references or in longer biographical studies. My graduate work was done at Harvard in the 1930s, and I was enamoured with the mathematical approach to economic analysis. But in mid life I became interested in the employment effects of automation and devised a new approach, which seems to be more realistic than the abstract analyses that characterize current work. This approach got me into arguments with colleagues and rejections by editors. I had been teaching a course on the history of economic thought and re-examined the field. Marshall came into focus. I re-read his Principles, and some parts of the book many times. Marshall’s economics is not understood in one reading.
Deceased.
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Notes
- 1.
Students who do look into Marshall’s Principles read Book V and perhaps peek into the Mathematical Appendix. Marshall suggested that the heart of his theory lay in Book V, but that was for a particular reason. His success with the integration of supply and demand theory led to an emphasis on a balancing of forces. Marshall explains in terms of an equilibrium concept. As it turned out, this has been very unfortunate, as will be explained. The student, who is willing to make the effort, should read carefully the Prefaces, Book I and Appendix A. Other parts will be suggested below. He should read with more than the usual care because Marshall was very deliberate with his composition.
- 2.
Twice in my lifetime this technique has produced remarkable results. Walking through the stacks of Widener Library at Harvard as a graduate student, a thought came which became my doctoral dissertation. Later in life I was reading Ben Seligman’s Most Notorious Victory, lamenting the loss of work to computers. As a respected economist, he should have offered a more balanced view of the goods and bads. As I walked to the university, I was suddenly taken by the thought of a formula that would offer such a solution. It has proven to be very useful.
- 3.
Mary Paley, of good family, was very helpful to Marshall. She was in the process of writing an introductory textbook in economics, which became a joint publication, and Marshall’s first effort in the field. After Marshall’s death she was for many years in charge of his papers, which became the Marshall Library at Cambridge.
- 4.
Adam Smith also was keenly interested in current business affairs.
- 5.
When I first went to McGill University in Montreal, Canada, in 1940, many of the top brass were British – the principal, the dean of the faculty of graduate studies, the registrar and the secretary of the Board of Governors. Shortly afterwards we acquired two more who soon became vice principals. During my stay these officials were replaced by Canadians – many of whom had received some part of their training in other countries. Canadians wanted to run things themselves.
- 6.
Marshall wrote ( 1890, 1920 , p. 303): “It is strong proof of the marvelous growth in recent times of a spirit of honesty and uprightness in commercial matters, that the leading officers of great public companies yield as little as they do to the vast temptations to fraud which lie in their way …”
- 7.
O’Brien wrote ( 1990 , p. 140) that “economists may have cited [Parsons] a little too uncritically”.
- 8.
Marshall did a much better job of it than Schmoller who “was extremely hostile to the abstract axiomatic-deductive method …” (Hagemann and Trautwein 1999 ).
- 9.
See for example Hutchison ( 1953 , pp. 79, 80).
- 10.
Cf. Jevons’s use ( 1871, 1931 ) of A causes B, which causes C.
- 11.
Marshall’s contributions include the concepts of representative firms and internal and external economies, which have a place in a Smithian dynamic world. The key role of the businessman is established.
- 12.
Smith’s contributions include the concepts of an active market, technical improvement, and with continuing change, the need for social and political flexibility.
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Beach, E. (2012). Alfred Marshall. 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_19
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