History of Economic Analysis part 24 pptx

German seventeenth-century writings of this genus, besides taking, of course, a different view as to policy, were not on this level but there were many of the Cary type or better. We shall be content with an Austrian representative, the well-known Hornigk, 7 who, like the much more important Becher and some others, figures in every history of economics. His book is another program for a policy of fostering economic development, written this time for a poor country, perennially threatened by Turkish invasions and lacking both the resources and the possibilities of England. If, however, we take due account of this fact, the family likeness of the recommendations with those of Hornigk’s English contemporaries—or even with those of the doctor in the Discourse of the Common Weal—is striking: waste lands and other unused resources are to be exploited; the efficiency of labor is to be increased by better training; domestic industry should be helped, among other things, by directing consumers’ demand toward its products; exports of manufactures and imports of necessary raw materials should be favored, exports of the latter and imports of the former restricted; trade should be balanced bilaterally with every individual foreign country (see last chapter of this Part); and so forth—sound sense all or most of it and very interesting as a monument of the intelligent bureaucrat’s thought, but sound sense that did not even suspect that it might be usefully reinforced by analysis. As regards the United States, there is nothing to record in the way of systematic endeavor before the nineteenth century. This is as we should expect from environmental conditions that were unlikely to produce either a demand for or supply of general treatises. But discussion of current practical problems was active even in colonial times, and for the eighteenth century, reports, pamphlets, and tracts abound, especially on questions of paper money, coinage, credit, trade, and fiscal policy. 8 And some of these performances answer to our idea of ‘quasi-systems.’ Here are three examples which the American reader is advised to look up for himself. First, Hamilton’s famous Report on 7 Oesterreich über Alles wann es nur will (1684). Philipp W.von Hornigk (1638–1712) was a civil servant. Extracts from the book are included in A.E.Monroe’s Early Economic Thought. 8 The late Professor Seligman’s essay, ‘Economics in the United States,’ reprinted as ch. 4 of his Essays in Economics (1925), gives a selection of titles (unfortunately little more than titles) on which I cannot hope to improve. Such reading as I have done was primarily guided by this selection. Also see C.F.Dunbar, ‘Economic Science in America, 1776–1876,’ in the North American Review, 1876, and the reprints of a number of the more important pamphlets by the Prince Society, 1911 (ed. McFarland Davis). American economists seem on the whole to have been too ready to discount the importance of that early literature from a scientific standpoint, and most of the attention it has received is confined to the policies or particular measures advocated or attacked. The critical historian then commends or blames according to his personal views on those policies and measures. The specifically analytic contribution of a writer as a rule goes by the board, especially in those cases where, as often happens in the field of money, ‘unsound’ practice goes with sound theory and vice versa. However, within the plan of this book, very little can be done to remedy this state of things. [J.A.S. wrote this chapter before the publication of Joseph H.Dorfman’s work, The Economic Mind in American Civilization, the first two volumes of which cover the period 1606–1865. J.A.S. read the first volume and made notes which he intended to use in revising the chapter.] History of economic analysis 192 Manufactures (1791), 9 though no doubt intended as a description with a program, is really ‘applied economics’ at its best and reveals quite clearly essentials of the analytic framework that was to be made explicit by D.Raymond and F.List and in turn points back to the work of such men as Child and Davenant. Second, Coxe’s work comes near to actually being a systematic treatise. 10 Third, Benjamin Franklin’s (1706–90) various tracts on economic subjects 11 present material enough to enable us to reconstruct his system—on the practical side, substantially of a laissez-faire type—though there is little to commend for purely analytic virtues. 6. PUBLIC FINANCE ONCE MORE In the first section of this chapter, the fact was emphasized that in the rising national states public finance acquired not only paramount importance but also a new significance. There would be little exaggeration in saying that, at least for the continental branches of the literature that have been surveyed, it was the central topic around which revolved most of the rest. Let us therefore retrace our steps and look more closely at the financial problem of these centuries. Public finance in our sense, and especially modern taxation, first developed in the course of the fifteenth century in the Italian city-republics, Florence in particular, and in the German free towns (Reichsstädte). More important for us is, however, the development of the fiscal systems of the national states and the Italian and German 9 Alexander Hamilton’s (1757–1804) brilliant figure is so familiar to the reader that it would be absurd to tell him who and what Hamilton was. Nor is there any need to refer to the Hamilton literature. All that needs to be said from the standpoint of our purpose is that he was one of those rare practitioners of economic policy who think it worth while to acquire more analytic economics than that smattering that does such good service in addressing audiences of a certain type. He knew Smithian economics well—not only A.Smith himself—so well in fact as to be able to mold it to his own visions of practical possibilities or necessities and to perceive its limitations. All his reports— not only the one mentioned in the text but also the ones on the import duty (1782), public credit (1790 and 1795), the establishment of a national bank (1790) and of a mint (1791)—are much more than untutored common sense. Perusal of the volumes of the Federalist, the periodical in which he co-operated with Madison and Jay, is strongly recommended: the American reader will get much more out of it than mere economics. For guidance in starting a study of Hamilton’s writings, see P.L.Ford, Bibliotheca Hamiltoniana (1886), and the life by H.C.Lodge (1882). 10 Tench Coxe (1755–1824), Commissioner of Revenue, A View of the United States …(1794), in form a collection of essays and addresses. 11 Particularly, Modest Inquiry into the Nature and Necessity of Paper Currency (1729); Observations concerning the Increase of Mankind…(1751); Positions to be Examined concerning National Wealth (1769; the work responsible for the opinion that this great realist was a physiocrat). But though these are, with the possible exception of his Reflections on the Augmentation of Wages, his only works that come at all within the category of economic research, other essays and much material that he contributed in a popular form to popular publications (such as Poor Richard’s Almanack) help to round off our knowledge of his opinions and analytic efforts (Works, ed. by John Bigelow, 1887–8). Of course, it would be still more absurd than it would have been in the case of Hamilton to dilate on the life and achievements of this household figure, particularly in view of the recent publication of a masterly life by Carl Van Doren. The consultant administrators 193 principalities. For the sake of both brevity and concreteness we shall think primarily of the case of the latter or, still more precisely, of the development of public finance in a typical temporal principality of Germany. Of course, people always recognized the existence of some interests that were common to all members of a political unit— recognition of the res publica was fostered, among other factors, by scholastic teaching. Nevertheless, public affairs were in legal principle the affairs of the territorial ruler. Wars in particular were his personal quarrels (compare the English official phrase that still survives, ‘the King’s enemies’). Hence, so far as the military service that his vassals owed to him proved inadequate—and this resource petered out in the course of the sixteenth century—he had to finance them from his own means. These consisted, first, of the feudal income from his own lands and, second, of a number of customary fiscal rights that went with the lordship of a principality, such as seigniorage, tolls, and customs, the right of charging for safe conduct of travelers and caravans of merchants, the right to levy taxes from Jewish communities for the protection extended to them, and rights to a wide variety of fees of all sorts (regalia). The rise in prices, the cost of mercenaries and later on of standing armies, profuse expenditure on court nobilities and bureaucracies, and other causes, all related to the political ambitions of those princes or else to the social structure of their territories, rendered these customary sources of revenue inadequate and led to a rapidly mounting burden of debt. In the untenable situations that ensued the princes appealed to their Estates on the plea that, for instance, a Turkish invasion was after all not only the private affair of the prince. The Estates thereupon granted subsidies which, apart from the contributions of the towns, they levied upon their own feudal income, that is, upon the dues their peasantries owed to them—land in their own management remaining free. At first they insisted each time that they were making the grant of their own free will in response to a humble request and only for the particular emergency in question; but they actually bore the burden. Very soon, however, regular recurrence of these direct taxes had to be recognized. But, while accepting the fact, the Estates, on the one hand, set up their own administrations for levying them and expending the proceeds and, on the other hand, no longer bore them themselves but collected them in turn from their dependent peasantries. This arrangement, besides being inadequate, was of course not at all to the taste of the princes and their bureaucracies. A tug of war between them and the Estates ensued for the control of this new fiscal apparatus that had grown up alongside of their own. The reader knows that the English parliament succeeded in keeping its hold on these purse strings which eventually in the seventeenth century throttled the power of the king. In most other countries, however, kings and princes, or rather their bureaucracies, won out in the course of the eighteenth, though the French ancien régime broke down in the attempt to secure fiscal reform. Meanwhile, that is to say, until the bureaucracies had conquered the fiscal stronghold of the Estates, the growing Leviathan had to feed on the old sources of revenue. Accordingly, development of these, especially of all the fiscal rights, became a major task of governments and their henchmen. This meant eventually the disproportionate growth of indirect taxation, especially in the forms of the General Excise on the one hand, and of the General Turnover Tax—the Spanish alcavala is the outstanding instance—on the History of economic analysis 194 other. For though the introduction or increase of indirect taxes, too, was in principle dependent upon the consent of the Estates, it proved, nearly everywhere except in England, easier to get round this requirement in the case of indirect than it was in the case of direct taxation. Princes and bureaucracies had also another motive for preferring the former. We are accustomed to looking upon indirect taxation as contrary to the interests of the relatively poor. But in the seventeenth and eighteenth centuries the ‘social’ argument told in favor of indirect taxation: for indirect taxes were at least also borne by the nobility and the clergy whereas these classes contributed hardly anything at all to the proceeds of direct taxation. However, since it was not easy to introduce or reform indirect taxes either—which, by the way, shows how far those monarchies were from being ‘absolute’—revenue from this source had to be increased according to opportunity rather than to any rational plan. And since, furthermore, governments were rarely in a position to abandon revenue from old fiscal rights however irrational, burdensome, or vexatious, the result was an almost unbelievable—the only word is ‘mess,’ the mere straightening out of which was an extremely difficult task which, when taken in hand in the seventeenth and eighteenth centuries, exercised the ingenuity of administrators and writers alike. The literature that blossomed forth in response to these conditions contains some analysis on such problems as incidence of taxes, which will be briefly noticed later on, and also analysis of a kind that had better be noticed right now, along with those much larger parts of that literature which are not relevant to a history of analytic economics and have to be mentioned only to be dismissed. First, the tug of war referred to produced innumerable books and pamphlets on the right to tax, the ‘justice’ of taxation, and the constitutional questions germane to taxation. We have already remarked on the important prelude to this that is contained in the scholastic writings. The laical literature of this type displays a characteristic difference in tendency between its English branch and its continental branches: most of the continental writers sided with the bureaucracies and often saw benighted and antisocial resistance of class interest where the vast majority of English writers—particularly in the struggle over the ship money of Charles I—saw a meritorious stand for liberty. All this was, however, either simple politics or ‘political philosophy’ and is of no interest to us. Second, pure description of sources of public revenue and administrative practice dates far back. There is an English instance for the twelfth century. 1 This literature developed greatly from the sixteenth century on, especially on the Continent, but needs no further attention for our purposes. 2 Third, the necessity of making the most of existing fiscal rights produced in 1 Richard Fitzneale Dialogus de scaccario (exchequer), ed. by Hughes, Crump, and Johnson (1902). 2 By way of example we may mention Anon., Traicté des finances de France (1580); N.Froumenteau, Le Secret des finances de France (1581), more interesting for the finances of the temporal and spiritual magnates than for the finances of the king; Jean Combes, Traicté des tailles et autres charges…(1586); Jean Hennequin, Le Guidon général des finances (1585, re-edited repeatedly, even as late as 1644); J.Matthias, Tractatio methodica…de contributionibus (1632); H.Conring (whom we shall meet again), De vectigalibus et aerario (1663). The last two are not merely descriptive, however, though all their interest lies in the description. The consultant administrators 195 the public service a special type of lawyer whose task it was to safeguard, extend, and systematize those rights by appropriate interpretation and who naturally also taught and wrote, creating what is known as Fiscal Jurisprudence. 3 A fourth category consisted of the fiscal planners—the numerous writers who advocated schemes of fiscal reform: every financial emergency or controversy since the fifteenth century naturally produced clusters of them. In the light of their ideas it would be possible to write not only a history of public finance but also a history of political society, for everything that happens in the political sphere reflects itself more truly in the prevailing ideas about fiscal policy than it does in anything else. Most of the planners did no analytic work, however. This is especially true of some of the most eminent ones among them, such as Cardinal Cusanus, who proposed a scheme that would in fact have rescued the German Empire from the decay into which it was falling in the fifteenth and sixteenth centuries. But some did analyze. They analyzed the nature of taxation—an early example, Mattheo Palmieri’s theory, has been mentioned already; its economic effects; the severity of pressure exerted by different systems; the effects of public expenditure; the relative merits of direct and indirect taxation and of financing of wars by taxation, borrowing, and inflation; and so on. Spanish discussion of the seventeenth and eighteenth centuries would be particularly interesting to follow, 4 English discussion on seventeenth and eighteenth-century war 3 This branch of public-finance literature, which in the nineteenth century swelled to dimensions beyond the range of anyone but the full-time specialist, should really not be dismissed so cavalierly. But we have no choice. In my—very likely erroneous—opinion, the classic of the genus is Caspar Klock’s Tractatus juridico-politico-polemico-historicus de aerario (1651). Its quaint title has the merit of expressing exactly what it is. C.Besold’s (see above, sec. 4) earlier De aerario publico discursus (1615) should, however, not go unmentioned. It contains, as does Klock’s, quite a lot of sound wisdom on tax policy that is as trite as, alas and alack, sound wisdom mostly is. 4 It turned mainly on the remedy to be applied to the grievances concerning the alcavala, the cientios, and the millones. Bautista Dávila (Resúmen de los medios prácticos para el general alivio de la monarqúia, date of writing unknown, publ. 1651; see Colmeiro’s Biblioteca) seems to have been one of the earliest economists—ignorance prevents me from being more precise—to look upon a single tax as the wand by which to conjure up the benign spirits of fiscal order. In any case his Resúmen is a milestone on the road to single-tax ideas. In his case, it was to be a graduated capitation tax, evidently meant to be a rough approximation to a proportional income tax. Similar ideas were discussed during the subsequent hundred years. The minister Ensenada (A.Rodriguez Villa, Don Cenon de Somodevilla, Marqués de Ensenada, 1878) made a modified version of this program his own and carried an income and property tax in 1729 (for Catalonia). But elsewhere and particularly in Germany, seventeenth-century discussion favored the general excise against direct taxes, precisely on the ground that it would relieve the pressure of taxation. An interesting symptom of this trend of opinion was the success of a book by an author who styled himself Christianus Teutophilus: Entdeckte Gold-Grube in der Accise (a gold mine discovered in the excise, 1685, of which the 5th ed. came out in 1719). Among English advocates of the excise Davenant was first in eminence. But he thought that the burden would fall on the land. For a similar reason, F.Fauquier (An Essay on the Ways and Means…1756) later on advocated a house tax, namely on the ground that, since indirect taxes so far as they are paid by the poor will be transferred to the rich by means of a rise in money wages, taxes should be laid on where they will rest without giving rise to the losses incident to the process of transference. Observe that this anticipates much of what A. Smith and Ricardo had to say on the subject. In appraising attitudes toward the taxation of land it must not be forgotten that, before the eighteenth century, no efficient methods of surveying were available. Taxation of agricultural land entered a new phase of its History of economic analysis 196 history when these were improved. The Censimento Milanese, at the beginning of the eighteenth century was one of the first results. finance or on Sir Robert Walpole’s excise scheme is no less so. But from the mass of this literature we shall select only two works of first-rate importance. Petty’s treatise on taxes and contributions (discussed in the following chapter) is not one of them because the interest it presents, though great, belongs in the field of general economics rather than in that of fiscal policy. The first is one of the works that were called forth by the economic situation of France during the last twenty years of the reign of Louis XIV. The War of the Spanish Succession following upon the War of the Grand Alliance was turning impoverishment into nationwide misery when one of the great figures of the state and the army, the soldier-engineer Vauban, committed the indiscretion of publishing an old idea of his, the Projet d’une dixme royale (1707). 5 This is one of the outstanding performances in the field of public finance, unsurpassed, before or after, in the neatness and cogency of the argument. The recommendation itself does not greatly matter here. Essentially it was that the unwieldy and irrational welter of taxes that had grown up in an entirely unsystematic way should be scrapped—excepting a rationalized salt tax, certain excises, and export and import duties—and replaced by a general income tax that was to apply to all kinds of income, though at varying rates, of which the highest was to be 10 per cent (hence the 5 Sébastien le Prestre, Seigneur de Vauban (1633–1707), Maréchal de France and a favorite with Louis XIV (until that publication), had previously written a tremendous number of memoirs on fortifications, war, naval matters, public finance, religion, money, agriculture, and colonization that fill an imposing series of manuscript volumes. In 1698 he had instigated orders for a census of the population, and in 1695 he had first suggested the project that he published in 1707. Somewhat like Étienne Boileau four centuries and a half before him, he had a passion for collecting and arranging economic facts and figures. Accordingly, he has had his partisans, who claimed for him the title of Créateur de la Statistique (E.Daire in his edition of the Dixme royale, in Economistes-financiers du XVIII e siècle, 1843, which is the edition used). The Dixme has been translated into English. There is a bibliography of Vauban by F.Gazin (1933). Also see D.Halévy, Vauban (1923); J.B.M.Vignes, Histoire des doctrines sur l’impôt en France (1909); and F.K.Mann, Der Marschall Vauban… (1914). In his effort to secure fiscal reform Vauban had two allies whose relation to him however is not clear. The one was Boisguillebert, who was much more of an economist than was Vauban and whose performance will be considered in chs. 4 and 6 of this Part. Here we need only record, first, that his proposal, though differing from Vauban’s, was yet conceived in the same spirit and expressed the same economic and fiscal vision; and, second, that Boisguillebert’s outspokenness or rather bitterness—witness the subtitle of his first book, Le Détail de la France. La France ruinée sous le règne de Louis XIV—and his inability to appreciate practical difficulties—witness another subtitle, Moyens très-faciles [!] de faire recevoir au Roy 80 millions par-dessus la capitation, praticable par deux heures de travail des Messieurs les Ministres [!!]—naturally annoyed the poor slaves whose bad luck it was to serve at that time as ministers of finance (Pontchartrain, Chamillart, Desmarets). The other ally therefore found it easier to get on terms with them. This was the Abbé de Saint-Pierre (1658–1743), famous as moralist, all-round reformer, sponsor of the League-of- Nations idea, whose considerable performance as a practical economist is gradually emerging into the light of day (Ouvrajes, 1733–41). See P.Harsin, ‘L’Abbé de Saint-Pierre, économiste,’ Revue d’histoire économique et sociale (1932). The consultant administrators 197 word dixme); similar ideas had occurred before. The features that do matter are these. First, Vauban rose fully to those heights, trodden by so few, from which fiscal policy is seen to be a tool of economic therapeutics, the ultimate result of a comprehensive survey of the economic process. With Gladstonian vision he realized that fiscal measures affect the economic organism right to its cells and that the method of raising a given amount of revenue may make all the difference between paralysis and prosperity. Second, he based his conclusions in every detail on numerical fact. His engineer’s mind did not guess. It figured out. Purposeful marshalling of all the available data was the essence of his analysis. Nobody ever understood better the true relation between facts and argument. It is this that makes him an economic classic in the eulogistic sense of the word, and a forerunner of modern tendencies, though he contributed nothing to the theoretical apparatus of economics. 6 His case affords another illustration of the truth that a man can be an excellent economist without being a good theorist. The reverse also holds true, unfortunately. The second work to be mentioned, Broggia’s 7 treatise on taxation, is of an entirely different nature and has been selected for entirely different reasons. It also outlines an ‘ideal’ system of taxation that might have been derived by critically developing that of Vauban: the main practical ideas, barring one, are roughly similar. But Italian sources, both earlier and contemporaneous ones, can be indicated for every particular, among others for the ‘canons of taxation’ (ch. 1) that, further expanded in Verri’s Meditazioni (1771), essentially anticipate those of A.Smith. Thus the freshness—the ‘subjective’ originality—that makes Vauban’s Projet such delightful reading is lacking here. Nor is there anything to correspond to the chief merit of Vauban’s work, the facts and figures. Instead, however, we find systematic completeness and more searching analysis: the result is—at least—a digest of all that was best, not only in the public-finance literature of the eighteenth century but also in most of that of the nineteenth. There is the fifteenth- century rationalization of taxes as payments for security and as equivalents for the services rendered by the government. There is the principle that direct and indirect taxation are necessary complements of each other, the two hands of finance (Gladstone 6 He has been called a forerunner of the physiocrats. There is not the slightest foundation for this. As has been pointed out before, concern with agricultural conditions does not make a writer a physiocrat. 7 Carlo Antonio Broggia’s (1683–1763) Trattato de’ tributi, delle monete e del governo politico della sanità (treatise on taxes, money, and the policy of public health, 1743) was planned as a comprehensive textbook-like treatment of the three topics indicated in the title. The edition in the Custodi collection separated them and we are interested only in the first which forms a self- contained unit (though there was considerable merit also in Broggia’s ideas on money and public health). We know almost nothing about the man—he seems to have been a businessman, or a retired businessman, of considerable acquirements. As a Neapolitan, he may be included in what we have called the Neapolitan school. The most interesting parts of the treatise on taxes are reprinted in the Economisti Napoletani of Tagliacozzo, who also presents us with a summary and appraisal of the work that contains references to immediate Italian predecessors of Broggia, especially Pascoli and Bandini—important links in the evolution of fiscal doctrine and analysis that must be neglected, to the fatal injury of the resulting picture, in a sketch like this. A fuller though, perhaps, not quite satisfactory picture both of Broggia’s work and of the development in which it was an element may be found in G.Ricca-Salerno, Storia delle dottrine finanziarie in Italia (1881). History of economic analysis 198 might have said that: actually, he spoke of two sisters so nearly alike that one hesitates in deciding which one to court). A proportional tax (10 per cent) on certain incomes (entrate certe, mainly from land, houses, including owner-inhabited ones, and public funds; compare A.Smith’s predilection for land and house taxes) that will not be transferred, is combined with a system of indirect taxes (gabelle) that are supposed to be transferred to buyers, whereas all uncertain incomes (profits, wages, and so on) are to be left free. The interesting thing about this is the underlying diagnosis of the economic situation: Broggia’s finance was to foster the increase of wealth through industrial and commercial activity; for this purpose, acquired wealth was to be taxed to force people into business pursuits, whereas both wealth in the making and labor were to be touched gently. This is why he recommended that money loans to business or monetary business funds (money impiegato a negozio) be left untaxed, and why even his direct taxes were not on personal incomes but on ‘real’ or ‘objective’ returns—he did give weight to considerations of administrative convenience in this, as Bodin and Botero had done already, but the essential point was to avoid fettering business activity and oppressing ‘struggling poverty.’ There are three aspects to this: first, a scheme of aims and valuations with which we are not more concerned than we are with all his talk about ‘justice’; second, a vision of social and economic conditions and their possibilities which went far below the surface; and, third, analysis, though not made entirely explicit, of economic causes and effects. It is this third point that constitutes the scientific merit of the work. 8 7. NOTE ON UTOPIAS A few words will be inserted here on sixteenth- and seventeenth-century state novels (Staatsromane) 1 which derive their name—Utopias—from the title of the peak success of the genus, the Utopia of Thomas More. This meaning of the term Utopia must be distinguished from the meaning that the Marxist phrase Utopian Socialism is intended to convey. F.Engels (1892) defined ‘utopian’ in contrast to ‘scientific’ socialism to denote socialist ideas that are (a) unconnected with an actual mass movement and (b) not based upon any proof of the existence of observable economic forces that tend to realize those ideas. In this sense, Morelly’s Code de la Nature (1755) is certainly utopian socialism. We have not called it a Utopia, however, not only because this would have restricted the concept to socialist utopias but also because in this book we wish to use the term, except when notice to the contrary is given, for something entirely different—for a distinctive literary type—for artistic creations of a nature that the term state novel suggests and 8 Professor Luigi Einaudi credits the physiocrats with having ‘created’ the pure theory of taxation (Atti, Reale Accademia delle Scienze di Torino, 1931–2). But with due deference to Professor Einaudi’s authority, I am inclined to think that in Broggia and the literature behind him there seem to be much more valuable elements of such a theory if, indeed, on the strength of the fact that neither he nor any other eighteenth-century writer produced a satisfactory analysis of incidence, we refuse to find in him that theory itself. 1 [See explanation of Staatsromane in ch. 1, sec. 2 of this Part.] The consultant administrators 199 Plato’s Republic exemplifies. In this sense, description of the blueprint of a socialist or any other kind of society, even though it does not exist, like the one drawn by Morelly, is not a utopia. This type, which, no doubt under Greek influence, was fairly popular in the epoch under review, 2 is difficult to interpret. A literary form may enshrine anything—from a day dream cast into a prose poem to the most realistic analysis. Fortunately it is always possible to recognize the presence and especially the absence of the latter element, though it is not always possible to say whether what presents itself as a statement of fact or as an imperative is to be understood as ‘poetry or as truth.’ Only four instances need be mentioned, the works of Francis Bacon, Harrington, Campanella, and More. And the first three may be dismissed at once as irrelevant to our purpose: Bacon’s New Atlantis (1627), a fragment—a singular deviation from the creed of ‘inductive science’ preached by its author—and Harrington’s Oceana (1656) are of no interest at all; to Campanella’s Civitas solis (City of the Sun, 1623) Platonic rays playing around rather commonplace matter do lend a glamour not its own; 3 but the case of More’s Utopia is different. 4 This rich book is full of mature wisdom and has naturally been the object of many different interpretations which, since we are concerned only with one of the many aspects it presents, and with a very minor one at that, we need not stay to discuss. Nor need we enter into More’s social criticisms or the general features of his communist scheme of life that facilitates the solution of most economic problems by the postulate of simple and invariant tastes in a population that is kept stationary or almost stationary by regulated or rather enforced emigration—one of the many points of similarity with Plato’s Politeia. Two things have relevance to analysis, however. First, the general plan of production and distribution of goods: tastes being given, the quantities currently produced, according to government regulations, by all adults except a privileged class of ‘learned’ men—not quite Plato’s guardians, because there is an elected king—are distributed so as to put all districts on a footing of equality on the basis of statistics of current production and by means of a system of public storage. This, whatever else it may mean, is not a bad 2 The reader presumably knows, however, that it has never died out, witness the great success of Bellamy’s Looking Backward, 2000–1887 (1888). But we shall have no occasion to mention any of these more modern Utopias in this book. 3 Tomaso Campanella (1568–1659); in his preface to Plato’s Politeia, Jowett presents an abstract. There is also a translation (in H.Morley’s Universal Library). All works on state novels and most histories of socialist and communist ideas, as well as several monographs, deal with Campanella more or less fully. 4 Sir Thomas More (1478–1535), the English Lord Chancellor who was beheaded by Henry VIII and canonized 400 years later, was a man of penetrating intelligence, comprehensive (classic) learning, and wide experience, none of which ever killed his good-natured humor; and all of these four qualities went into the making of his Utopia, published in Latin in 1516, translated into English (after German, Italian, and French translations had appeared) in 1551. The considerable literature on More, so far as a perfunctory examination permits me to judge, is for the most part not relevant to our purpose. Bonar’s Philosophy and Political Economy will tell the interested reader all that has any bearing upon economics as such. Reference may, however, be made also to E.Dermenghem, Thomas Morus et les utopistes de la renaissance (1927). History of economic analysis 200 method to put into evidence the essentials of the functioning of any economic organism. In particular, a serviceable theory of money may be derived from this conception, and More hints at this theory by pouring out the vials of humorous wrath on the fetishism of gold and silver, which, unless required for paying for excess imports, Utopia uses only for purposes indicative of More’s contempt. Criticism of the popular economics of his day may well have been one of the major aims of this construction. Second, his criticism of economic conditions, though most weighty in legal and especially penological matters, were interspersed with diagnoses and formulations some of which may be ranked as contributions to analysis. The tracing of unemployment to enclosures, though always a half truth, was not, in 1516, the commonplace it became soon afterwards. And he introduced the word and concept of oligopoly in exactly the same sense in which we use it now. The consultant administrators 201 . renaissance (1927). History of economic analysis 200 method to put into evidence the essentials of the functioning of any economic organism. In particular, a serviceable theory of money may be. of land it must not be forgotten that, before the eighteenth century, no efficient methods of surveying were available. Taxation of agricultural land entered a new phase of its History of economic. field of general economics rather than in that of fiscal policy. The first is one of the works that were called forth by the economic situation of France during the last twenty years of the