The New Palgrave Dictionary of Economics

2018 Edition
| Editors: Macmillan Publishers Ltd

Owen, Robert (1771–1858)

  • N. W. Thompson
Reference work entry
DOI: https://doi.org/10.1057/978-1-349-95189-5_1820

Abstract

Born in Newtown, Montgomeryshire (Powys), in 1771, Robert Owen was in many ways both the child and the victim of his age, making his fortune as a cotton manufacture involved in the industrial transformation of Britain and dissipating it in his efforts to eliminate its evils. With the purchase of the New Lanark cotton mills in 1797 Owen did, for a time, successfully combine the roles of factory owner and social reformer, showing how a humanized working environment might effect a reformation in human character. For the modern social scientist, one interesting innovation Owen implemented was the silent monitor, a four-sided block that was hung next to each worker’s machine; a supervisor would turn the block to a colour that reflected the worker’s effort during the day; colours were recorded in a ‘book of character’. (See Podmore 1906, based on Owen’s autobiography.) The silent monitor was meant to substitute for corporal punishment as a discipline device; it resonates with recent thinking on social sanctions; see pecuniary versus non-pecuniary penalties.

Keywords

Autarky Class conflict Labour time Owen, R. Pecuniary and non-pecuniary penalties Poverty alleviation Socialism 

Born in Newtown, Montgomeryshire (Powys), in 1771, Robert Owen was in many ways both the child and the victim of his age, making his fortune as a cotton manufacture involved in the industrial transformation of Britain and dissipating it in his efforts to eliminate its evils. With the purchase of the New Lanark cotton mills in 1797 Owen did, for a time, successfully combine the roles of factory owner and social reformer, showing how a humanized working environment might effect a reformation in human character. For the modern social scientist, one interesting innovation Owen implemented was the silent monitor, a four-sided block that was hung next to each worker’s machine; a supervisor would turn the block to a colour that reflected the worker’s effort during the day; colours were recorded in a ‘book of character’. (See Podmore 1906, based on Owen’s autobiography.) The silent monitor was meant to substitute for corporal punishment as a discipline device; it resonates with recent thinking on social sanctions; see pecuniary versus non-pecuniary penalties.

Owen’s success in the New Lanark venture encouraged him to devote his life to the regeneration of mankind and it also provided him with the funds necessary to attempt this. However, further practical experiments proved disastrous. The cooperative communities he established, such as those at New Harmony Indiana in 1824 and Queenwood in Hampshire in 1839, soon collapsed, while his efforts in 1832 to socialize money through a National Equitable Labour Exchange proved equally disastrous. However, such failures never inspired self-doubt and Owen remained to the end of his long life a living embodiment of hope’s capacity to triumph over experience.

As a cotton manufacturer Owen grasped the potential for material abundance which industrialization was creating in early 19th-century Britain; yet as an acute observer of economic life he was equally aware of the existence of widespread material impoverishment. His chief concern in his economic writings was, therefore, to investigate this paradox of poverty in the midst of abundance and show how it might be resolved.

For Owen the realization of economic prosperity for all was obstructed by the tendency, in a competitive market economy, for rapid mechanization to create ‘a most unfavourable disproportion between the demand for and supply of labour’. This resulted in its progressive devaluation which in turn caused a diminution in consumption and a general economic crisis as manufacturers responded to a deficiency of effective demand by reducing output and laying off labour. As Owen phrased it, ‘It is want of a profitable market that alone checks the successful and otherwise beneficial industry of the labouring-classes’.

To remove this constraint upon production and to realize the potentialities of industrial development, Owen believed that ‘Human labour [should] acquire its natural and intrinsic value, which would increase as science advanced’, and to secure this Owen argued in such works as his Report to the County of Lanark (1821) that goods should be valued according to the labour time that they embodied and exchanged against labour notes rather than conventional money. Such a socialization of exchange, Owen believed, would give labour its whole product and further ensure that aggregate supply and aggregate demand expanded pari passu.

It was these ideas which bore practical fruit in the National Equitable Labour Exchange, where attempts were made to value goods and reward labour in terms of time. As might be expected this institution suffered a speedy demise. However, it was never seen by Owen as more than a stepping stone to his ideal of a ‘new moral world’ of neo-autarkic cooperative communities, where each would contribute to the common stock according to ability and consume according to need. Insulated thus against the exploitation and vagaries of a competitive market economy, material well-being could be assured and the character of man created anew.

Owen’s economic writing was only one facet of a more general attempt to construct a science of society – a science which would have both an explanatory and prescriptive power and which could be used to determine the means necessary to transform man from an egotistical, competitive atom into a truly social being. It was this broader intellectual enterprise which enthused and interested British socialist thinkers in the first half of the 19th century, as can be seen, for example, in their redefinition of ‘political’ as ‘social’ or ‘moral’ economy.

Engels in The Condition of the Working Class in England (1844) remarked that, ‘English socialism arose with Owen, a manufacturer, and proceeds therefore with great consideration towards the bourgeoisie’, and, undoubtedly, Owen’s tendency to stress the socially harmonious future and the ultimate reconcilability of class antagonism, rather than the social hostilities of the present, left its quietistic mark upon Owenite socialism. Yet for socialist writers such as Thompson, Gray and Bray, Owen’s real legacy was methodological rather than ideological. What they imbibed from Owen was a particular, social scientific way of approaching the condition of labour rather than any unwillingness to unearth the roots of social antagonism.

Selected Works

  • 1813. A new view of society, essays on the formation of human character. London: Printed for Cadell and Davies.

  • 1815. Observations on the effect of the manufacturing system, 2nd ed. London.

  • 1817. Report to the committee for the relief of the manufacturing poor. In The life of Robert Owen written by himself, 2 vols. London, 1857–8.

  • 1818. Two memorials on behalf of the working classes. In The life of Robert Owen written by himself, 2 vols. London, 1857–8.

  • 1819. An address to the master manufacturers of Great Britain. Bolton.

  • 1821. Report to the county of Lanark of a plan for relieving public distress. Glasgow: Glasgow University Press.

  • 1823. An explanation of the cause of distress which pervades the civilized parts of the world. London: Printed for the British and Foreign Philanthropic Society.

  • 1832. An address to all classes in the state. London.

  • 1849. The revolution in the mind and practice of the human race. London.

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Copyright information

© Macmillan Publishers Ltd. 2018

Authors and Affiliations

  • N. W. Thompson
    • 1
  1. 1.