The Golden Age That Wasn't (1956-1973)

The split between Kaldor and Robinson was all the more tragic in that they continued to agree both on the most fundamental issues on which they had already worked (growth, distribution and capital theory) and on the new questions of methodology to which they soon turned (path dependence, hysteresis, the limitations of equilibrium modelling and the role of history). The next 15 years were a period of great intellectual achievement for both Kaldor and Robinson (see King 2002: Chapter 3). The intense and sometimes venomous ‘Cambridge controversies in the theory of capital’ that erupted after the publication of Sraffa’s slim volume in I960 embroiled leading theorists from Cambridge, Massachusetts, notably Paul Samuelson and Robert Solow, in a desperate attempt to salvage the neoclassical theory of capital from the deep criticisms that first Robinson and then Sraffa had made in print. By 1966, it was clear that Cambridge, England, had won (Harcourt 1972), though in the second decade of the twenty-first century you could be forgiven for not realising it, as the great majority of the economics profession continues to use neoclassical capital, distribution and growth theory as if the Cambridge controversies had never happened (Cohen and Harcourt 2003).

The era of cheap air travel that began in the mid- to late 1960s led to increasingly close contact between Cambridge economics and the rest of the world. Among the Cambridge Post Keynesians, Kaldor and Robinson especially became great travellers, with the former’s 1956 world tour taking in India, Japan, Chile and the USA. American visitors to Cambridge on sabbatical leave in this period included Samuelson and Solow, the most prominent of the neoclassical Keynesians, and also Kenneth Arrow. There had always been foreign research students, with talented young economists arriving from as far away as Australia since the 1930s (Millmow 2015), and they became even more numerous in the post-war period. Some of them stayed. The two intellectual historians with whom this chapter began were, of course, themselves immigrants. Harcourt came back to Cambridge in 1963-1966, 1972-1973 and 1980, and again for a much longer spell that began in 1982 and ended with his return to Australia in 2010. Pasinetti was a University Lecturer (later Reader) and Fellow of King’s from 1961 to 1976 before he moved back permanently to Italy.

Their hosts were not, however, always as welcoming as they might have been. Harcourt has often recalled his harsh treatment by Kaldor when the callow young colonial boy dared to visit his potential PhD supervisor out of term (e.g. in King 1995: 168-169). In this case, the overseas student recovered from being sent away with a flea in his ear and became a satisfied long-term resident, but others were less happy. The subsequently eminent trade theorist Murray Kemp, who was no blushing violet, recalled how, in 1959-1960,

Cambridge was a great disappointment, as there was no provision for graduate work and I was postgraduate. There were six Australian graduate students, PhD students. I think it was the experience of each of them that theyd made a huge mistake in coming to England. They all had nominal supervisors but had no real guidance and no course work (Kemp quoted in Coleman 2005: 7).

Harcourt responded angrily to Kemp, denying that he was the only Australian of that cohort to successfully complete his degree and reporting on the seminars and lectures that had been organised for them, with the active participation of Kahn and Robinson. ‘Sraffa’, he conceded, ‘was a little aloof as he was still recovering from falling off a mountain and cracking his skull’ (Harcourt 2006b: 147).

Sraffa’s injury seems to have had long-term consequences. One subsequent visitor to Cambridge from Italy offered me the following recollections:

In 1969 I went to Cambridge to meet Maurice Dobb. I carried a letter of introduction from the cultural section of the Central Committee of the Communist Party of Italy. He introduced me to Sraffa. My question was:

‘to become a functioning communist one must know economics, as Marx realised. Hence, should I come here to study or stay in Rome’? Answer by Sraffa, paraphrasing: ‘forget it’. And then, quoting him: ‘in mathematics [I was studying maths at the University of Rome then] you learn, you learn, you learn; in economics you talk, you talk, you talk’. End of Sraffa’s contribution. Dobb began to disagree with him, and said: ‘This is not what Joseph wants. He wants to know whether studying contemporary economics is worthwhile from a Marxist point of view.’ No response from Sraffa. Later at coffee I asked him if I could get some working papers or lecture notes from him, and he said he had none. End of story. Dobb then took me for a walk and suggested I stay in Italy: ‘you will get much more there than here’, he intimated (Joseph Halevi, personal communication,

29 June 2011).

Five years later Halevi returned to Cambridge for three months to use the University library and work on Kalecki. He was officially sponsored by Kaldor and by Bob Rowthorn, and had some useful discussions with Pasinetti. For the most part, however,

It was awful! Kaldor told me right away that Kalecki was bad and his oligopoly theory was bunk, and that I should change my thesis into one on Kaldor himself... With Joan Robinson it was fight at first sight. I dared ask her whether she thought that either the Kaldor-Pasinetti or the Kalecki consumption functions were too passive. What would happen, I asked, if we brought in a Modigliani-Ando type of consumption function? These were genuinely naive questions, motivated only by trying to find out what was objective and what was subjective in what was then modern theory (Marx would have done exactly the same). Answer by Robinson, verbatim: ‘This is a free country. You can always leave and go to the United States’ (ibid.).

It was not only Italians who suffered. Some indication of the difficulties that the Cambridge Post Keynesians caused themselves can be seen from the chequered history of their early contacts with the pioneering American Post Keynesian, Sidney Weintraub, who had spent the academic year 1938-1939 at the LSE, where he had been on friendly terms with Kaldor. When, in 1960, Weintraub sent Kahn a copy of his recently published paper on wage inflation, which was sharply critical of IS-LM Keynesianism (Weintraub 1960), he received an unexpectedly patronising reply recommending that he read Kahn’s evidence to the Radcliffe Committee and three papers by Joan Robinson dating from 1937, 1943 and 1958. ‘The message was brutally clear. Cambridge had (of course) got there first. Weintraub was nothing more than a colonial interloper’ (King 2008: 144). This was nothing new; Kahn’s (sadly unpublished) letters to Robinson in 1933 during his US lecture tour read like the reactions of a visitor to a high-class zoo on encountering its wide range of exotic but amusing animals. (They are in the Richard Kahn Papers at King’s College Archive Centre, Cambridge University: RKP 13/90/1.)

Weintraub was sufficiently upset by Kahn’s response that he referred to it many years later in correspondence with both Geoff Harcourt and Jan Kregel. His own reply was passed on by Kahn to Robinson, who offered a rather backhanded apology that included this revealing statement: ‘On the main question this is evidently a “semantic misunderstanding”. For you “Keynes’ theory” means some latter-day nonsense, while to us, the old guard, it is a coherent system of analysis in which the wage-price relation is an essential part’ (Robinson quoted in King 2008: 145). The dismissal of IS-LM as ‘some latter-day nonsense’ (in 1961!) testifies to the Cambridge Post Keynesians’ long-term neglect of the Old Keynesian or neoclassical synthesis, which they evidently regarded as being beneath contempt.

Fences were eventually mended, with Weintraub visiting Cambridge and Robinson meeting up with him at the University of Waterloo in Canada, where he had a two-year appointment in 1969-1971; she had grandchildren nearby. But the Cambridge arrogance was apparent again in the story of Paul Davidson’s appalling treatment at the hands of Robinson and Kahn in 1970 or 1971. They walked into his seminar several minutes late, Robinson took over the blackboard and spent the next 15 minutes explaining where Davidson was wrong, and they then walked out again without allowing him to reply (King 1994: 367-368).

This cannot have encouraged transatlantic cooperation. (Would you send your best students to do postgraduate work at Cambridge after you had been told that story? Would you encourage younger colleagues, at a critical stage in their careers, to apply for jobs there?) Once again the Americans proved forgiving. When Davidson and Weintraub started the Journal of Post Keynesian Economics in 1977, Kaldor was one of ten members of the Honorary Board of Editors, along with Harcourt; Robinson had been offered the honour, but declined. Of the 53 members of the ‘Managing Board of Editors’ however, only three (Wynne Godley, Jan Kregel and Pasinetti) had Cambridge connections.