Introduction about the Popular Economists
Of Different Periods
By:
Dipendra Nepali
Submitted To:
Laxmi Paudel, Lecturer of Economics
Nobel Academy
Faculty of Management (+2) HSEB
Kathmandu
November 2010
Adam Smith
Born: 16 June 1723(OS: 5 June 1723)
Died :17 July 1790 (aged 67)
Era: Classical economics
Main interests :Political philosophy, ethics, economics
Died :17 July 1790 (aged 67)
Era: Classical economics
Main interests :Political philosophy, ethics, economics
In his word ,”Economics is the study of the activities of people involved in the production of wealth.”
Adam Smith ( baptised 16 June 1723 – died 17 July 1790 [OS: 5 June 1723 – 17 July 1790]) was a Scottish moral philosopher and a pioneer of political economics. One of the key figures of the Scottish Enlightenment, Smith is the author of The Theory of Moral Sentiments One of the key figures of the Scottish Enlightenment, Smith is the author of The Theory of Moral Sentiments and An Inquiry into the Nature and Causes of the Wealth of Nations. The latter, usually abbreviated as The Wealth of Nations, is considered his magnum opus and the first modern work of economics. Smith is widely cited as the father of modern economics and capitalism.
Smith studied moral philosophy at the University of Glasgow and the University of Oxford. After graduating, he delivered a successful series of public lectures at Edinburgh, leading him to collaborate with David Hume during the Scottish Enlightenment. Smith obtained a professorship at Glasgow teaching moral philosophy, and during this time he wrote and published The Theory of Moral Sentiments. In his later life, he took a tutoring position that allowed him to travel throughout Europe, where he met other intellectual leaders of his day. Smith returned home and spent the next ten years writing The Wealth of Nations, publishing it in 1776. He died in 1790.
Criticisms
It was criticized on Adam Smith's definition of Economics by Dr. Alfred Marshall and some other neo classical economists on the basis of following points.
• Man occupies a primary place and wealth only a secondary one. As Marshall puts it, Economics is "on the one side a study of wealth; and on the other side and more important side, a part of the study of Man." But in the view of Adam Smith and other classical economists, Economics is the study of wealth. On that point, It was criticized that the primary importance was given to wealth and secondary to man. In this way the human being was degraded and ignored.
• Adam Smith included only material goods in economics and excluded services i.e. doctor's, teacher's and lawyer's services. We know that their services are also as important as goods.
• Adam Smith emphasis only to earn the wealth. They did not study about the means to earn the wealth.
• He ignores the human welfare as compared to wealth. According to them wealth is more important than human welfare.
• The word wealth is controversial and the majority of the people dislike it. They thought that wealth is an evil.
• Economics was supposed to teach selfishness and came to be called a "dismal science"
When Adam Smith gave definition of economics in 1776, British society was a religious society. Therefore, religious minded people criticized the subject of economics on the ground that it will make the society as well as the individual materialistic and will take them away from spiritual
Values like friendship, brotherhood, love, sacrifice, patriotism. Instead, it will make them selfish, greedy, hypocrite etc. due to pursuit for materialism. Two literary figures, Carlyle and Ruskin, were the main critics of Economics. They raised hue and cry against it.
They said that economics is a "dismal science" which teaches mammon worship. Some other people said ironically that Economics, a science of materialism, is just "a science of bread and butter" and it promotes selfishness and greed. They thought that if economics was taught, the science of materialism will take mankind away from spiritualism. Hence, Carlyle even went to the extent of saying that economics is "a pig Philosophy" and therefore it should not be studied.
They said that economics is a "dismal science" which teaches mammon worship. Some other people said ironically that Economics, a science of materialism, is just "a science of bread and butter" and it promotes selfishness and greed. They thought that if economics was taught, the science of materialism will take mankind away from spiritualism. Hence, Carlyle even went to the extent of saying that economics is "a pig Philosophy" and therefore it should not be studied.
This criticism is not completely justifiable. It seems to be sentimental and not logical. The reason is that they saw only the negative side of the picture. Everything has its pros and cons. As it is known that wealth is the biggest reality of life and there is no life without wealth particularly food. Wealth itself is not bad. Its use could be good or bad.
Alfred Marshall
Birth: 26 July 1842 Death 13
Death: 13 July 1924 (aged 81)
Nationality: United Kingdom
Influences: Leon Walras, Vilfredo Pareto, Jules Dupuit, Stanley Jevons
In his words, “Economics is a study of mankind in ordinary business of life .It inquires how a man earns income & how he uses it. Thus, it is on one side the study of wealth and on the other the most important part, is the study of mankind.
Alfred Marshall (born 26 July 1842 in Bermondsey, London, England, died 13 July 1924 in Cambridge, England) was an English economist and one of the most influential economists of his time, as one of the founders of neoclassical economics. His book, Principles of Economics (1890), became the dominant economic textbook in England for a long period. It brings the ideas of supply and demand, marginal utility and costs of production into a cohere Marshall grew up in the London suburb of Clapham and was educated at the Merchant Taylor's School, Northwood and St John's CBermondsey, London, England
College, Cambridge, where he demonstrated an aptitude in mathematics, achieving the rank of Second Wrangler in the 1865 Cambridge Mathematical Tripos. Although he wanted, at the behest of his father, to become a clergyman, his success at Cambridge University led him to an academic career. He became a professor in 1868 specializing in political economy. He desired to improve the mathematical rigor of economics and transform it into a more scientific profession. In the 1870s he wrote a small number of tracts on international trade and the problems of protectionism. In 1879, many of these works were compiled into a work entitled The Pure Theory of Foreign Trade: the Pure Theory of Domestic Values. In the same year (1879) he published The Economics of Industry with his wife Mary Paley Marshall.nt whole.
Criticisms:
Lionel Robbins criticized Marshal's definition of economics in his book "Nature and Significance of Economic Science". That was written in 1932. He particularly focused the phrase "material requisites of well being". The points of his criticism are as follows:
It limits the scope of economics:
Marshal says that in economics we study production and consumption of material requisites or good only e.g. Radio, TV, furniture, book etc. he therefore excludes non material requisites of well being e.g. services of doctors, teachers and advocates etc. Thus, he has limited the scope of Economics.
Material requisites which don't promote welfare are excluded:
Marshal includes in his definition of economics only those requisites which promote welfare and excluded those which don't promote welfare e.g. drugs, cigarettes, alcoholic drinks etc. therefore, Robbins is trying to say is "just satisfy wants and don't bother whether they are for the better or the worse".
Welfare is not measurable concept:
According to Robbins welfare is not measurable concept whereas in economics we should use measurable concepts. According to him, it can not be calculated that how much welfare a good will give to an individual or a society.
Problems in policy making:
Marshal's definition of economics creates a problem of liking and disliking on the basis of welfare e.g. wine should not be taken and cake can be taken. This retards human freedom for the satisfaction of wants.
It limits the scope of economics:
Marshal says that in economics we study production and consumption of material requisites or good only e.g. Radio, TV, furniture, book etc. he therefore excludes non material requisites of well being e.g. services of doctors, teachers and advocates etc. Thus, he has limited the scope of Economics.
Material requisites which don't promote welfare are excluded:
Marshal includes in his definition of economics only those requisites which promote welfare and excluded those which don't promote welfare e.g. drugs, cigarettes, alcoholic drinks etc. therefore, Robbins is trying to say is "just satisfy wants and don't bother whether they are for the better or the worse".
Welfare is not measurable concept:
According to Robbins welfare is not measurable concept whereas in economics we should use measurable concepts. According to him, it can not be calculated that how much welfare a good will give to an individual or a society.
Problems in policy making:
Marshal's definition of economics creates a problem of liking and disliking on the basis of welfare e.g. wine should not be taken and cake can be taken. This retards human freedom for the satisfaction of wants.
Lionel Robbins
Birth: 27th July 1978.
Death: 15 May 1984
Nationality: British
Institution: London School of Economics
Influences: Léon Walras, November 1898 Vilfredo Pareto, Eugen von Böhm-Bawerk, Friedrich Hayek, Friedrich von Wieser, Knut Wicksell
In his word “Economics is the science which studies human behavior as a relationship between unlimited ends & scarce means which have alternative uses.”
Lionel Charles Robbins, Baron Robbins, FBA (22 November 1898 - 15 May 1984) was a British economist and head of the economics department at the London School of Economics. He is known for his proposed definition of economics, and for his instrumental efforts in shifting Anglo-Saxon economics from its Marshallian direction. Robbins is famous for his definition of economics:"Economics is a science which studies human behavior as a relationship between ends and scarce means which have alternative uses."
A follower of William Stanley Jevons and Philip Wicksteed, he was influenced by the Continental European economists: Ludwig Von Mises, Léon Walras, Vilfredo Pareto, Eugen von Böhm-Bawerk , Friedrich Hayek, Friedrich von Wieser and Knut Wicksell. Robbins succeeded Allyn Young in the chair of the London School of Economics in 1929. Among his first appointments was Friedrich A. Hayek, who bred a new generation of English-speaking "continentals" such as John Hicks, Nicholas Kaldor, Abba Lerner and Tibor Scitovsky. Frank Knight was an American influence on Robbins.
Lionel C.Robbins, lived 1898-1984 A.D., gave the definition, which has been criticized on several grounds:
1) Ethical aspect ignored: Robbins does not consider economics as a normative science. He overemphasized economics as a positive science. In his view, economics only says how man behaves and not how he should behave.
2) Too much stress on scarcity: Robbins lays too much stress on the scarcity aspect. He forgets that an economic problem may also out of abundance.
3) Imprecise scope: According to Robbins's definition, the scope of economics is either too wide or too narrow. In the wider sense, economics embraces almost the whole of man's life and in the narrow sense economics would be a science of price theory or market equilibrium.
4) Neglect of social aspects: Robbins's definition studies and deals with individual behavior only. In fact, economics is a social science which deals with man's behavior as a member of society as well.
5) No human touch: Robbins’s definition lacks human touch. A satisfactory definition should be concerned not only with the adjustments of scarce resources to unlimited wants, but also with human welfare.
6) Static, not dynamic: Dynamic economics is concerned with growth or development. Robbins's definition takes a static view of the economic problem and therefore does not help us to solve the problem of development.
Wants of people in a given society are unlimited. The satisfaction of one wants leads to the occurrence of other wants. Since these wants are unlimited, we have to choose between more urgent and less urgent wants .and in any nation four factors of production are limited. It is this fact that give rise to the science of economics. And the scarce means are to be adjusted to the multiple ends which secure maximum utility this means he indirectly considers material and being of the people. Some economists think scarcity definition limits the scope of economics which is a social science. This definition converts economics into a pure science that formulates economic theory. So many economists believe that economics is not only a tool maker but a tools user science.
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