panaceas. Barring his panacea (the Single Tax) and the phraseology connected with it, he was a very orthodox economist and extremely conservative as to methods. They were those of the English ‘classics,’ A.Smith being his particular favorite. Marshall and Böhm- Bawerk he failed to understand. But up to and including Mill’s treatise, he was thoroughly at home in scientific economics; and he shared none of the current misunderstandings or prejudices concerning it. Even the panacea—nationalization not of land but of the rent of land by a confiscatory tax—benefited by his competence as an economist, for he was careful to frame his ‘remedy’ in such a manner as to cause the minimum injury to the efficiency of the private-enterprise economy. Professional economists who focused attention on the single-tax proposal and condemned Henry George’s teaching, root and branch, were hardly just to him. The proposal itself, one of the many descendants of Quesnay’s impôt unique, though vitiated by association with the untenable theory that the phenomenon of poverty is entirely due to the absorption of all surpluses 2 by the rent of land, is not economically unsound, except in that it involves an unwarranted optimism concerning the yield of such a tax. In any case, it should not be put down as nonsense. If Ricardo’s vision of economic evolution had been correct, it would even have been obvious wisdom. And obvious wisdom is in fact what George said in Progress and Poverty (ch. 1, Book IX) about the economic effects to be expected from a removal of fiscal burdens—if such a removal were feasible. [(a) The Men Who Prepared the Ground.] The work and services of the men in the first of our groups will be illustrated by the names of Dunbar, Hadley, Newcomb, Sumner, Walker, and Wells. Charles F.Dunbar (1830–1900) was no product of the academic hothouse. His very American career—American in a sense that is now but a reminiscence—led through business, farming, law, journalism, and newspaper management to the first (regular) professorship of economics in Harvard plus vigorous participation in university administration plus highly successful activity in the editorial chair of the Quarterly Journal of Economics, which he founded in 1886. We shall not expect that he did creative research. How is it then that no history of American economics could be complete without mentioning him 1 Henry George (1839–97) is too familiar a figure to need introduction. Besides Progress and Poverty (1879) only the posthumously published Science of Political Economy (1897) need be mentioned here. His Complete Works, with a Life, were edited by his son (1906–11). A scholarly appreciation of all the backgrounds and affinities of the Georgian doctrine may be found in E.Teilhac’s Pioneers of American Economic Thought (1936), ch. III. 2 Business profits he analyzed into a premium of risk, wages, and interest, exactly like Mill; therefore he did not consider them to be disposable surpluses. History of economic analysis 832 and what can students have got from him? Both questions can be answered simultaneously: he knew the subject matter of economics from first-hand experience; his mind was clear and penetrating; his writings may not have been ‘scholarly’ in the strictest sense, but any scholar could have learned from them (and still can); 3 his administrative ability enabled him to organize the studies in our field in a way that made the most of the opportunities then existing; and, after all, the essentials of the scientific apparatus of that time were not so complicated that an able man—a mind that intuitively knew what is what—could not have mastered them in a very short time. And so, though not a great economist in the sense appropriate to this book, he was a great economist in the sight of God. Arthur T.Hadley (1856–1930) was more of a purely academic man, though he was also more of an administrator than a teacher or scholar. The work for the sake of which he is mentioned here is his Economics…(1896). The reader should really look at it. He will find a core of not very refined, but eminently serviceable and realistic, theory embedded in a forceful presentation of the institutional framework (plenty of policies and politics)—the ideal thing for all-round introduction on a respectable level, and glorified, as seems to have been his teaching in general, by a gift for felicitous formulation. Who can beat—on that level—his definition of increasing and decreasing cost? You have increasing cost if a producer sets a price at which he is willing to sell a given quantity or less, and decreasing costs if he be willing to sell at that price a given quantity or more. Simon Newcomb (1835–1909) was an eminent astronomer who also taught, and wrote on, economics but not enough to acquire the influence he deserved. He is chiefly remembered as a sound-money man and a laissez-faire ultra, but his name stands here because of his Principles of Political Economy (1885), the outstanding performance of American general economics in the pre-ClarkFisher-Taussig epoch. He had not ‘got on’ to the Jevons-Menger-Walras level and his analysis was substantially ‘classic.’ But his presentation was masterly and highly suggestive, also original in several points. But among these points is not the Equation of Exchange that Fisher credited to him; this was but a formulation of what was then an old story. William G.Sumner (1840–1910), wholly an academic man and also a sound-money, laissez-faire ultra, 4 was for the rest a different kind of person. He was 3 His best work has been collected in his Economic Essays (ed. by O.M.W.Sprague with introduction by F.W.Taussig, 1904). But his Chapters on Banking (privately printed 1885; 1st ed. 1891; 5th ed. by O.M.W.Sprague as Theory and History of Banking, 1929) is still worth reading. 4 Though the ‘politics’ of our men are none of our business, it might be argued, in the cases of Newcomb and Sumner, that their ultra-liberalism went so far as to imply arguments, theoretical and factual, that reflect upon their judgment as scientific economists. This would be true for any contemporaneous European. But it must not be forgotten that in the United States environment of that epoch, the attitude of Newcomb and Sumner might have been supported by facts that would have impressed Marx himself, when in his historical mood, but do not lend any support to the economic liberalism of, say, M.de Molinari. The general economics of the period 833 a sociologist of eminence (his analysis of ‘folkways’ was an extremely fertile contribution) and his historical work on money and finance ranks with the best performances of American economics. 5 But this is not why he is mentioned here. In addition to all that, he was a powerful and stimulating teacher of wide horizons—he, the historian and sociologist, drew Irving Fisher’s attention to the possibilities of mathematical theory!—who, from his chair in Yale, spread the message of high standards of scholarship. Francis Amasa Walker (1840–1897), the son of Amasa, was, like Dunbar and Hadley, primarily an administrator (Massachusetts Institute of Technology). He was also, for a time, a genuine soldier and a civil servant of distinction (revenue, census). But his indefatigable industry enabled him to earn a great reputation as a scholar. This reputation rests primarily upon his work in money and currency policy (see below ch. 8), but he performed creditably also in the field of general economics. 6 He was the kind of man who cannot touch anything without improving it, and his many activities brought him very much to the fore—among other things, he was the first president of the American Economic Association, a president of the American Statistical Association, co-president (or ‘assistant’ president) of the Institut International de Statistique. As a scientific economist, he therefore got rather more than his due both in his day and in the historical record. In particular, his own contributions to economic theory (residual-claimant theory of wages, emphasis upon the role of the entrepreneur, criticism of the wage-fund theory) received perhaps more attention than they would have if made by a less prominent man. But I am saying this to protect the memory of others—and the historical standing of American economics of that time—and not to discount the services of a man whose name certainly deserves to live forever in the history of our subject. David A.Wells (1828–98) we have met already. He is mentioned again to impress upon the reader’s mind how important in the total of American research was the factual component—also in the makings of American general economics. His famous Recent Economic Changes (1889), which every modern student of economics should study, illustrates admirably what I mean. Wells stands here as the representative of a large class. Carroll D.Wright (1840–1909) would have made an almost equally good one. But this sketch must not degenerate into a catalogue. [(b) Clark, Fisher, and Taussig.] There cannot be much difference of opinion, among either adherents or opponents, about the actual positions in American economics held by Clark and Taussig in the first decade of this century, though there may be about Fisher’s position at that time. The difficulty is to appraise their positions in the history of that economics. The three men were cast in very different molds. All they have in common is eminence and 5 His main achievement was the History of American Currency (1874), followed by the History of Banking in the United States (1896). 6 See especially The Wages Question (1876) and his textbook Political Economy (1883). A bibliography that gives an idea of the range of his activities has been compiled in the Publications of the American Statistical Association, June 1897. History of economic analysis 834 the fact that they were all purebred academic economists. Perhaps, however, there is also something else. All three of them stood out as economists in the technical sense; for the rest they accepted unquestioningly the grand commonplaces of their time and country: they were all three of them typically animae candidae Americanae. But not even their detractors will deny that, however much helped by the times, they were for the world at large ‘the’ great American economists of that period. John Bates Clark (1847–1938), last of the claimants to independent discovery of the principle of marginal analysis and architect of one of its most significant theoretical structures, did not conquer an adequate pulpit until 1895, when he was called to Columbia. There he remained until his retirement (1923), and there he witnessed the vogue of his teaching that may be said to have lasted from 1895 to 1910. But the fundamental elements of his theoretical system were all worked out before, mainly, I think, during the 1880’s, though some seem to have emerged in his mind in the early 1870’s before his visit to Europe. In part, this shows in the papers he published in the 1880’s, which, if space permitted, could be shown to display stages of the development of his thought in a very interesting manner. They also corroborate the claim alluded to because they reveal his own individual route to marginal productivity distribution: what he did was to turn the ‘Ricardian’ theory of rent, which with Ricardo had no other function than to eliminate rent from the price problem by making it an intramarginal surplus, into a principle that was of general application to all kinds of competitive returns (‘law of three rents’) without becoming tautological in the process—marginal utility (and disutility) coming in quite naturally on this route. In spite of the priority of Thünen, on the one hand, and Jevons, Menger, and Walras, on the other, this was an achievement of the first order of importance and, so we may add now, of subjective originality. Nor was it his only one. Apart from his theory of capital (see below, ch. 6, sec. 2c), he made a great stride toward a satisfactory theory of the entrepreneur’s function and the entrepreneur’s gain and, in connection with this, another great stride toward that clarification of all economic problems that must result from a clear distinction between stationary and evolutionary states. He identified this indeed with the distinction between statics and dynamics. But this did not greatly matter. He saw the essential points involved in constructing the model of a stationary state and he created, for the purpose of describing its properties, the concept of Synchronization. To call him simply the master of American marginalism, therefore, spells failure to grasp the whole of his analytic message. If his achievement fell short of that of Böhm-Bawerk, Marshall, and Walras in some respects, it rose above theirs in others. 7 7 Clark’s first book, highly characteristic of the man and of his outlook on the world—perhaps also of the spirit of an environment—is not relevant to our purposes except as regards one point I am about to mention in the text: The Philosophy of Wealth (1885). It contributed greatly to establishing his reputation, however. His famous Distribution of Wealth appeared in 1899, and is a theory of a stationary process, all the essential elements of which he had published before. So far as per- The general economics of the period 835 But it is as the master of American marginalism that he was and is chiefly known to the American profession and to the world. 8 The reader has presumably heard so often of the Clark school or the Marginalist school that he may be surprised at the difficulty I experience in adopting this phrase. All American and many foreign economists who were interested in economic theory at all were of course greatly influenced by Clark and they learned from him. There is no question about this. The circle of ‘allies and sympathizers’ was extremely large, and there certainly was a ‘foreign sphere of influence.’ But the precise extent of his influence is difficult to determine because, so far as his theory of distribution goes, this influence is inextricably mixed with the influences of all the other builders of similar systems. Even in the United States, one has to look very closely at an author—at his theoretical mannerisms, for instance—in order to make sure whether he got his marginal productivity theory from Clark or from Marshall or from the Austrians. More important, there was no clearly discernible ‘core’ in the sense in which there was a nucleus consisting of sworn disciples such as Ricardo or Marshall had. Strictly Clarkian treatises are as rare as treatises displaying Clarkian influence are numerous. Among theoretical writings of importance, the one that comes nearest to developing Clarkian doctrine is Carver’s, 9 but, textbooks excepted, I do not know of any other. Nevertheless, Marginalism came quickly to be considered the badge of a distinct school. And not only that: it even acquired a political connotation, growing, in the eyes of some, into a reactionary monster that stood ready to defend capitalism and to sabotage social reform. In logic, there is no sense whatever in this. The marginal principle per se is a tool of analysis, the use of which imposes itself as soon as analysis comes of age. Marx would have used it as a matter of course if he had been born fifty years later. It can no more serve to characterize a school of economics than the use of the calculus can serve to characterize a scientific school or group in mathematics or physics. To this day, the very use of the term Marginalism is indicative of erroneous sonal aspects are concerned, the date is as misleading as is 1890 in the case of Marshall. Of almost equal importance is his Essentials of Economic Theory (1907). Of his other works only The Control of Trusts (1901; rewritten in collaboration with his son, 1912) and The Problem of Monopoly (1904) need be mentioned here. But we should not forget his factual work, mainly with the Division of Economics and History of the Carnegie Foundation. Let me draw the reader’s attention to the charming Memorial to that great and lovable man, prepared by his children and privately printed in 1938. 8 See on this the chapter on Clark in Paul T.Homan, Contemporary Economic Thought (1928). 9 Thomas N.Carver, Distribution of Wealth (1904). I take this opportunity to mention the name of an American theorist who developed marginalist theory independently of Clark—Stuart Wood, another case of striking ‘subjective originality.’ By 1889 Wood had in fact discovered for himself a whole Walrasian system with variable coefficients of production (substitution) added. So far as theoretical groundwork goes, he could have written the Marshallian treatise. See G.J.Stigler, ‘Stuart Wood and the Marginal Productivity Theory,’ Quarterly Journal of Economics, August 1947, especially p. 644. History of economic analysis 836 conceptions of the nature of the principle. A fortiori, it cannot have any bearing upon policy or social philosophy: this is perfectly understood in England, where no radical or socialist takes offense at it. It is only the political or ethical interpretation that is put upon the results of marginal analysis which can have such a bearing. And, as has been pointed out before, Clark was not free from blame. He was, of course, within his right when, in a book on the Philosophy of Wealth, he expounded his ethical evaluations, though they were of a type that is apt to get on radical nerves. But he went further and asserted that distribution according to the ‘law’ of marginal productivity is ‘fair.’ And this, in the eyes of a profession, the large majority of which did not take kindly to theory in any case, created an association between ‘Clarkian marginalism’ and capitalist apologetics in the face of the refuting fact that this ‘marginalism,’ barring differences in technique, plays exactly the same role it played with Clark in the reasoning of scientific economists of socialist persuasion, such as Professors Lange and Lerner. 10 Frank William Taussig (1859–1940), whom we are to consider next, must suffer still more than either Clark or Fisher from my inability to draw, within the available space, well-rounded pictures of individuals as such. He rose to prominence later than Clark, and his influence was still increasing when, in 1917, he accepted the chairmanship of the newly created Tariff Commission and, during the war, various other public duties from which he returned with enhanced reputation and authority. Barring this interruption he was a teacher at Harvard throughout his adult life—and certainly one of the greatest teachers of economics who ever lived. His teaching in the classroom, his guiding advice, and, last but not least, his example formed innumerable young minds and no man had more to do with the steady rise of standards throughout the period than had he. However, except in the field of international trade, he did not form a school in our sense. Measuring by hours of work, his research was primarily factual: in particular, he was the country’s great authority on international trade and especially the tariff. Even in this field, facts came first—earlier publications on the subject developing into his classic Tariff History of the United States (1888)—and theory came afterwards (International Trade, 1927), though he was a master of the art of welding factual and theoretical analysis. Also he developed an interest in economic sociology that produced important results. His Inventors and Money Makers (1915) and his American Business Leaders (in collaboration with C.S.Joslyn, 1932) are 10 In order not to have to return to this subject, let us use the opportunity to notice another factor that keeps that association alive. Reformers, like other people, are not above making mistakes. It is the duty of the professional economist to point them out. Now, if the economist in doing so uses ‘marginal’ methods, the criticized person’s humanly understandable resentment will often take the form of complaints that he has been attacked by the reactionary monster called Marginalism. If there be in fact logical error on his part, he could in general be convicted of it without the use of this modest piece of apparatus. But not understanding theory, he is not aware of this and he naturally turns against these parts of the critic’s argument which he under stands least of all. The general economics of the period 837 the chief examples. The roots of his theory are to be found in Ricardo and in Böhm- Bawerk, whose influences show clearly in his most ambitious theoretical venture, Wages and Capital (1896; London School Reprint, 1932). Formed by an older tradition, he displayed a curious resistance to the newer doctrines—Böhm-Bawerk’s capital theory excepted—which is perhaps why, of all their exponents, Marshall appealed to him most. But this resistance wore away, and in the end nothing was left of it except certain formal reservations that are not entirely unlike Marshall’s. A turning point is indicated by his ‘Outlines of a Theory of Wages’ (Proceedings of the American Economic Association, April 1910) that frankly embraced marginal analysis. Criticisms may no doubt be raised, from a technical standpoint, against the general economics he taught, and some of them are valid even ex visu of 1900. But he was more than a theorist, historian, and economic sociologist. Above all, he was a great economist. The first edition of his Principles of Economics (1911) will help us to appraise ‘what students got’ at that time. 11 Irving Fisher (1867–1947) was a Yale man from first to last—one of the two stars of the first magnitude that glorify Yale’s scientific record, the other being Willard Gibbs, the great physicist. He was a mathematician by training and even taught astronomy for a year. We neglect all those of his scientific or propagandist activities (temperance, eugenics, hygiene, and others) that have nothing to do with economic analysis and, for the moment, also his writings on money and cycles, which will be noticed in the last chapter of this Part. Also we cannot go into his considerable contributions to the theory of statistics (index numbers, distributed lags, 12 and others) beyond emphasizing that with him statistical method was a part of economic theory and no longer a mere adjunct to it— in other words that he was essentially an econometrician standing in line with Petty and Quesnay. The following remarks must be confined to his three main works in general theory. The first, his thesis—Mathematical Investigations in the Theory of Value and Prices (1892, reprint 1926) 11 Since it is impossible to do full justice to that great figure within this book, the reader’s attention is drawn to a memorial that was published in the Quarterly Journal of Economics, May 1941, by some of his colleagues. [This was written by J.A. Schumpeter with the assistance of Arthur H.Cole and Edward S.Mason.] 12 It should be observed, however, that the idea of distributing the effect of a disturbance upon several subsequent values of the variable affected is of the utmost importance for economic theory. Clearly, it is unrealistic—and in fact a counsel of despair—to say that a disturbance in some variable x that occurs at the time t will just affect the value of x (or of any other variable that depends upon x) at the time t+n and at no other. We all know that a violent change in, say, a price or a set of prices will affect subsequent values of this and other prices over a more or less prolonged period and with an intensity that varies within that period. Economic reasoning that fails to take account of this cannot be said to have outgrown childhood. Yet Fisher was the first to face this problem and to try to develop a method that will take care of it statistically. This method (improved by Franz L.Alt) was very imperfect. But it constitutes a pioneer venture that will bear fruit through the ages. The reader will find all references in Alt’s paper, ‘Distributed Lags,’ Econometrica, April 1942. History of economic analysis 838 —is a masterly presentation of the Walrasian groundwork. To this, however, Fisher added (at least 13 ) two contributions of first-class importance and originality: he indicated a method for measuring the marginal utility of income (which he developed later in his paper published in Economic Essays Contributed in Honor of John Bates Clark, 1927) and in the second Part of the Mathematical Investigations, where he treated (as Edgeworth had done) the utility of every commodity as a function of the quantities of all commodities, he developed the fundaments of indifference-curve analysis. The second, his Nature of Capital and Income (1906), which was much admired by Pareto, besides presenting the first economic theory of accounting, is (or should be) the basis of modern income analysis. 14 In the third, The Rate of Interest (1907, done over and republished in new form in 1930 as The Theory of Interest), 15 his generous acknowledgment of the priorities of Rae and Böhm-Bawerk did not allow the powerful originality of his own performance to stand out as it should. The ‘impatience’ theory of interest is but an element of it. Much better would its nature have been rendered by some such title as: Another Theory of the Capitalist Process. Among the many novelties of detail, the introduction of the concept of marginal efficiency of capital (he called it marginal rate of return over cost) deserves particular notice. 16 This, together with Fisher’s work in the fields of money and cycles, will substantiate the statement that some future historian may well consider Fisher as the greatest of America’s scientific economists up to our own day. But this was not the opinion of his contemporaries. In the profession and the world at large, Fisher was, so far as the period under survey is concerned, not widely recognized until he became the Fisher of the ‘compensated dollar,’ which most people did not like. Even later on it was ‘stable money’ and ‘100 per cent 13 There are others. But I wish to confine myself to the two that are generally recognized by now. 14 Again, this is the main thing about it. The appendices contain a wealth of suggestions that are stimulating even to him who does not agree with all of Fisher’s results. 15 The volume includes much, but not enough, of Capital and Income, and the gist of Fisher’s monograph on ‘Appreciation and Interest,’ Publications of the American Economic Association, August 1896. 16 Two remarks should be made in passing. First, the identity of the Fisherian concept with the Keynesian marginal efficiency of capital has been recognized by Keynes (and Kahn) but denied by some of the followers of Keynes, notably by Professor Lerner. Second, when emphasizing Fisher’s generous acknowledgment of Böhm-Bawerk’s work, I did not contradict my statement in sec. 4a above. Fisher did not fully realize the extent of Böhm-Bawerk’s achievement and was unduly influenced by the surface defects of the latter’s exposition. This is quite compatible with saying what is indeed obvious, that Fisher did generously recognize all he saw in Böhm-Bawerk: Fisher, Keynes, and Wicksell are the three authors whom I should name if I were asked to illustrate by examples what it is I mean by ‘adequate acknowledgment’ In fact, these three exemplify more than I mean: all three must be defended against the consequences of their readiness to unearth predecessors that, in some points, goes so far as to obscure the true state of things. The general economics of the period 839 reserve against deposits,’ and so on which diverted attention from his genuinely scientific work. In these and other matters, Fisher, a reformer of the highest and the purest type, never counted costs—even those most intensive pain costs which consist in being looked upon as something of a crank—and his fame as a scientist suffered correspondingly. In addition, the very nature of his achievement did not make for quick success. The Mathematical Investigations passed practically unnoticed, of course, and came into its own only when the contents were no longer of any except historical interest. The contents of Capital and Income were considered by most people as elaborate trivialities. The Rate of Interest fared better, nationally and internationally, but it is doubtful whether it conveyed its message fully before the reformulation published in 1930. [(c) A Few More Leading Figures.] The economics profession reminds the outsider of nothing so much as of the Tower of Babel. However, to some extent we have seen already, and to a greater extent we shall see in the next chapter, that this impression is, on closer inspection of the scenery, not only easier to explain but also less justified than it might seem. In this subsection we shall carry our work of description a little further by mentioning a few more leading figures that stand out, here and there, from the divisions of the ever-growing army of United States economists that was then, as it is now, surging on in apparent disorder. The reader is asked once more to bear in mind that we have noticed the men in the institutionalist movement 17 in the preceding chapter (Veblen and Commons in particular) and that a few more men will be mentioned in our survey of the period’s work in applied fields. 18 But he is also asked to remember that the point of view appropriate to our purpose excludes or pushes into the background men whose services were invaluable to the profession and to their students if they did not do the kind of work that matters here, which means chiefly, if they neither contributed to the development of our apparatus of analysis nor proved themselves masters in its use. I exemplify by the honored names of Henry C.Adams, Ely, Hollander, Laughlin, Seager, and Seligman. 19 17 [It will be recalled that J.A.S. intended to write on American institutionalism in Chapter 4, which was not completed.] 18 No doubt this procedure has its disadvantages even apart from the impossibility of doing full justice to the work in the applied fields. In order to illustrate these disadvantages let us select a man like William Z.Ripley (1867–1944). The man who wrote on the races of Europe, and wrote and lectured on railroads and labor—and this is far from describing his activities exhaustively—is certainly not adequately characterized by his work in any or all of these fields. Some who were students of his at Harvard told me that they received more inspiration from him than from anyone else, and the department then included Taussig, Carver, and Young. He therefore certainly ought to figure among ‘general economists,’ whatever his deficiencies in technical analysis may have been. And this goes for many men of his type. [The survey of the period’s work in the applied fields (ch. 6, sec. 6) was unfortunately not completed.] 19 The reader who desires to do so can easily follow up the suggestion implied in mentioning these names. Particular reference should be made to the very instructive History of economic analysis 840 In one of those divisions which in fact he did much to create, Professor Frank A.Fetter (1863–1949) rose to a leading position in the first decade of this century. He was primarily, though not exclusively, a theorist, a man of scientific progress and no friend to theoretical survivals. He has sometimes been classed as an ‘Austrian,’ but this is not quite correct. It is true that at that time all serious theoretical endeavor had to start from the bases laid by Jevons, Menger, and Walras and that non-mathematicians would prefer the Menger version to the other two. It is also true that he did not like Marshall—precisely because of the latter’s attempts to preserve outmoded heirlooms—a feeling that was perhaps reciprocated. But all this does not suffice to make a man a follower of Menger. On that basis, Fetter erected a building that was his own, both as a whole and in many points of detail, such as the theory of ‘psychic income.’ The vivifying influence upon the American profession’s interest in theory of his critical exploits cannot be evaluated too highly. 20 Fred M.Taylor (1855–1932) is another name that comes to mind whenever we feel able to muster sufficient complacency to congratulate ourselves on the present level of economic analysis in the country. He was eminently a teacher of economic theory—down to the minutiae of theoretical reasoning—and formed very many minds, among them those of some of the most prominent economists of today: there is a Taylor school though not in the one-master one-doctrine sense. His own work developed from, and went into, his teaching and he was very hesitant about publication. But when it eventually did appear, his Principles of Economics (1911; 9th ed., 1925) was a great success. Though technically it is open to many objections, I wonder whether modern students would not do well to refresh themselves by a dive into Taylor’s world of problems, which of course—like the problems of most of the theorists of that age—seem now very remote. Taylor’s highly significant contribution to the theory of the socialist economy will be noticed elsewhere. As the period drew toward its end, the non-mathematical theorist found himself confronted by an increasingly difficult task. This was Taylor’s predicament and the main source of his inadequacies. The same applies to Herbert obituaries of Ely, that excellent German professor in an American skin (by H.C. Taylor in the Economic Journal, April 1944), and of Seligman, that kindly leader and indefatigable worker (by G.F.Shirras, ibid. September 1939). Hollander’s work on Ricardo has been mentioned, however, and some of Laughlin’s on money and of Adams’ and Seligman’s on public finance will be mentioned in the appropriate places. Carver has been mentioned above. 20 Perusal of Fetter’s Principles of Economics (1904) is not quite enough to substantiate the statements above. But the book gives all the essentials of what may be called the Fetter system. Some of his papers we shall meet later. The one on the relation between rent and interest illustrates a fact that blurs the frontier line of Fetter’s influence, viz. the fact that there are parallelisms between his teaching and Fisher’s. The one on ‘The Passing of the Old [Ricardian] Rent Concept’ is Fetter’s most directly anti-Marshallian performance. I do not know how Marshall took the— wholly justified—stricture. But I do know that Edgeworth resented it on the not quite convincing ground that he did not like papers with titles like that. The general economics of the period 841 . Productivity Theory,’ Quarterly Journal of Economics, August 1947, especially p. 644. History of economic analysis 836 conceptions of the nature of the principle. A fortiori, it cannot. level of economic analysis in the country. He was eminently a teacher of economic theory—down to the minutiae of theoretical reasoning—and formed very many minds, among them those of some of. memory of others—and the historical standing of American economics of that time—and not to discount the services of a man whose name certainly deserves to live forever in the history of our