The Historicist Movement in England
When Foxwell started his lecturing activity in Cambridge, British political economy was going through a period of deep commotion. On the one hand, Jevons was proposing a more mathematical approach to e conomics while fiercely reacting against the received authority of Ricardo and Mill for their roles, according to him, in having ‘shunted the car of Economic science on to a wrong line’ (Jevons 1871: li). On the other hand, the disconnected but highly vocal historicist movement in England, headed by William Cunningham, John Kells Ingram, Thomas E. Cliffe Leslie, and Arnold Toynbee, among others, was directing an all-out attack against the very foundations of the classical—and even the emerging neoclassical—orthodoxy. The historicists reacted, first, against the narrowness of the scope of political economy, calling for economic thinking to consider social factors that were so prominent in other fields of science such as sociology, biology, and morals. Second, they condemned the excessively universal and abstract Ricardian style of reasoning, based on self-interest and competition, for its not taking into account the role of non-economic motives and the ever-changing condition of society. Lastly, they argued that political economy should have a more practical character, looking systematically into matters of an applied nature (Schumpeter 1963: 821-824; Koot 1977; Coats 1954). Cunningham, Lecturer of fconomics and history at Cambridge from 1884 to 1897, writing in 1878 on the moral aspects of political economy, remarked that economic phenomena ought to be interpreted not as the outcome of one single factor, but more properly as the result of ‘many forces which are qualitatively, not merely quantitatively, distinct’ (Cunningham 1878: 372).[1] Subsequently, Cunningham (1892) went on to attack the application of Marshall’s economics to the study of historical matters.
Foxwell was not opposed to abstract theory outright, as his praise of Jevons’s work testifies, but he was sympathetically inclined towards the precepts of the historicist movement. The 1887 article ‘The Economic Movement in England’, deemed by Maynard Keynes to be one of Foxwell’s best pieces (Keynes 1936: 592, fn. 2), begins by offering a somewhat overstated portrait of classical economics, accusing it of being a strong materialistic doctrine, of sacrificing national welfare to individual riches, and of relying on mechanical laws to describe the nature of human action as purely selfish. Mill’s contribution, Foxwell argued, had added nothing substantial to this picture, being more like the transfusion of ‘new wine into the same bottles’ (Foxwell 1887: 85). This kind of approach, he continued, could not fail to raise the opposition of the best minds in literary, artistic, and spiritual circles, and to bring economic science into disrepute in many quarters. Most importantly, the old doctrine of competition had been overshadowed by the advent of a new historical reality, marked by the rise of the working class, the end of the period of prosperity in 1874, when silver was demonetized, and the profound reorganization of industry on a worldwide scale towards a new monopolistic phase.
Three factors, in Foxwell’s opinion, would bring about the downfall of the old laissez-faire doctrine. First, the rise of a truly scientific approach to economics, initially introduced by Jevons and improved by Marshall, characterized by the use of mathematics in economic reasoning, the exactness of definitions, and the setting of a clear boundary between theory and reality. Second, the strengthening of the historical approach, which emerged from the work of intellectuals like Cliffe Leslie and Henry Maine, from discoveries regarding the social implications of the evolutionary views in biology, and also from the German historical philosophy. In a clear depiction of this new historical perspective of society’s dynamics, Foxwell wrote:
[T]he new school take comparatively little interest in the deductions, because they hold that the facts have not yet been carefully observed, that the assumptions have only a remote relation to the facts, that the facts themselves are in the process of evolution and change, and that the nature and direction of this social evolution are a far more important object of study than elaborate and complicated deductions (ibid.: 89).
The last factor to cause the decline of the classical school was, for Foxwell, the resurgence of the old British moral and humanist spirit, once so active against slavery and in favour of factory legislation, which now stood up once more against the materialistic bent of the times professed by the old economic doctrine. But Foxwell was also quick to dismiss any possible friction between these quite diverse views on the main object of economics, and immediately proposed a strategic alliance among the moralist, the mathematical, and the historical schools. That association was to be built upon a tacit compartmen- talization of economic knowledge, that is, by the assignment of precise limits to each approach within the new science: ‘If the theorist, the historian, and the moralist keep strictly within the bounds of their several inquiries, they will aid and not conflict with each other’ (ibid.: 91). The interesting aspect to be noted here is that Foxwell was recommending essentially the same solution, devised by his Cambridge colleague, John Neville Keynes, in his 1891 The Scope and Method of Political Economy, to the general state of dissension pervading economics. That book proposed a clear separation among the distinct fields of economic inquiry as the most effective medicine for methodological disputes. Commenting on the frequent confusion between theoretical propositions, moral considerations, and policy prescriptions, Neville Keynes remarked: ‘In other words, the theoretical and practical enquiries should not be systematically combined, or merged in one another, as is maintained by those who declare that political economy is an indivisible whole of theoretical and practical investigations’ (Keynes 1897: 65).
It must also be recognized that Foxwell’s readiness to directly attack the Ricardian heritage may have played a role in the demise of his friendship with Marshall, who considered his own work a natural evolution of the classical tradition in British political economy (Shove 1942). Furthermore, by the turn of the century, even work that was inspired by Marshallian methods was being considered as ‘too Ricardian’ by Foxwell.[2] When Marshall’s successor to the Chair of Political Economy at Cambridge was being considered in 1908, Marshall’s surreptitious manoeuvres in the lead up to the ballot assured that his young pupil, A.C. Pigou, was elected to the post against the candidacy of long-time lecturer Foxwell, who felt betrayed by the outcome and thenceforward distanced himself from Marshall (Coase 1972; Coats 1972; Groenewegen 1995: 622-627).[3] That, however, does not mean that Marshall was opposed to the historicist movement in Britain, at least in its most elaborated version which claimed an inevitable role for history in economics—as against the purely inductive empiricism of some more radical thinkers.[4]
- [1] Alternatively, as argued by Cliffe Leslie in his Essays in Political Economy: ‘The main questions respectingthe influence alike of the “desire of wealth” and of expenditure and consumption are: To what kinds ofwealth, what modes of acquisition, and what actual uses do they lead in different states of society, andunder different institutions, and other surrounding conditions? To what laws of social evolution are theysubject in the foregoing respects? On these points we learn nothing from abstract political economy’(Leslie 1888: 171).
- [2] When reviewing and reporting on Pigou’s successful King’s College Fellowship thesis (Pigou 1901),which was a Marshallian economic history of relative agricultural prices in the second half of the nineteenth century, Foxwell reported that Pigou was ‘too much of a Ricardian; too much enamoured of histechnical apparatus’ (Foxwell quoted in McLure 2013: 275).
- [3] After the episode, Foxwell acquired a distaste for Pigou which lasted all the way through the First WorldWar and beyond. During Pigou’s trials for exemption from military service, Foxwell, in a less-than-nobleattitude, offered himself to fill Pigou’s place at Cambridge in case the exemption that had been granted atthe first trial was reversed (Aslanbeigui 1992). Also, Pigou’s application for membership of the BritishAcademy was denied until 1927 due, to a great extent, to Foxwell’s opposition (Winch 2014).
- [4] Marshall was not only content to express his sympathy for the historicist movement but also for theevolutionary approach to economics that draws upon biological analogy (Hodgson 2005).
