History of Economic Thought

Surely, the most enduring contribution of Foxwell to the field of economic thought was his lifelong and relentless dedication to building a definitive compilation of the literature of economics, encompassing the works not only of the luminaries of political economy, but also of almost all lesser known authors or even of completely obscure and popular writers. As reported by Foxwell in his own description of the origins and development of the Goldsmiths’ Library, he always endeavoured to acquire works that covered all sides of a controversy, no matter what had been at stake or the different viewpoints involved. In total, the resulting pamphlets, broadsides, and tracts that he collected from the most diverse sources accounted for almost two- thirds of the complete Goldsmiths’ Library.^[1] In Foxwell’s words:

Whatever the subject in question, a collection made on these lines would necessarily include a large quantity of tracts and fugitive publications. But in economics, more perhaps than in any other subject, its historical sources are largely of an occasional, non-formal character; and the brief contributions of practical men are often of much greater value than the more systematic disquisitions of professed writers (Foxwell 1908a: 721).

Before going into Foxwell reflections on the history of economic thought, however, it might be opportune to mention his personal views on some of his contemporary economists.

Marshall, of course, comes first, not only for his prominence at the time, but also for the turbulent relationship between these two Cambridge professors. In Foxwell’s 1887 ‘The Economic Movement in England’, Marshall appears three times, two of which place him together with Jevons, who are both portrayed as the true pioneers of scientific economics in Britain. In the third mention, Marshall’s Economics of Industry is hailed as an important work in the reconstruction of economics in Britain, being deemed a book accessible to the layman and without a doctrinaire approach to applied problems. Besides that, Foxwell reminded the reader that Marshall had a large personal influence in academic circles throughout the country, half of the economic chairs in Britain being occupied by his pupils (Foxwell 1887: 88, 91, 92). However, as alluded to above, Foxwell’s deferential posture towards Marshall changed radically in the early years of the twentieth century, especially after Pigou’s 1908 election to the Chair of Political Economy at Cambridge (Groenewegen 1995: 670-679).

It has also been suggested that Foxwell was one of Maynard Keynes’s major influences (Koot 1977). In 1913, Foxwell wrote a review of Keynes’s just released Indian Currency and Finance. After some considerations on the benefits of bimetallism, Foxwell praises the book as a fine example of how economic science should be presented, that is, by keeping theory behind the scenes, dispensing with technical terminology or fancy diagrams, and displaying instead a sober handling of statistical work applied to practical issues. In the end, Foxwell characterizes Keynes as one of the leading economists of the time, even comparable to Jevons, with the book under review showing lucidity, sagacity, and caution at the same time, along with the facility to be read by the public in general: ‘The author, indeed, gives proof of a remarkable and very rare union of qualities which place him in the front rank of living economists. He combines with first-rate analytic power and grasp of principle a thoroughly realistic bent and wide familiarity with business and administration’ (Foxwell 1913: 572).

As for Jevons, Foxwell nurtured a mix of friendship and admiration. Jevons was actually the one who introduced Foxwell to the activity of book hunting, when the former bought a copy of Lardner’s Railway Economy in 1875 (Foxwell 1908a: 720). In his introduction to Jevons’s Investigations, Foxwell commends his late friend for dealing with a most pressing issue, namely the instability of the economy, which was at the very foundation of many modern economic problems. In addition, stated Foxwell, Jevons had done this by striking the right balance between theory and practice, particularly through the judicious use of pertinent statistics to check his forecasts (Foxwell 1884: xxiv-xxv). Setting himself away from pure empiricism, Foxwell defends Jevons’s theory of business cycles against the critics by calling attention to the mass of data amassed in the book and to the sheer impossibility of taking all causative factors into account in any explanation of reality: ‘The truth is that these “practical” objections, pushed to their logical conclusion... would confine us strictly to the observation of isolated and, therefore, unintelligible facts’ (Foxwell 1884: xxxiv- xxxv). Still, Jevons’s Theory of Political Economy is seen by Foxwell as the opening of a new era in English economics giving, on the one hand, organic unity to economic science through the formal precision of definitions and assumptions while, on the other hand, setting strict boundaries to both theory and practice, a crucial difference often neglected by the old doctrinaire economists (Foxwell 1887: 88).

William Cunningham, who died on 10 June 1919 in Cambridge, was the subject of Foxwell’s obituary in the pages of the Economic Journal in September of the same year. For Foxwell, Cunningham, throughout his academic life, always stood against the individualistic doctrine of laissez-faire economists, being more properly a defender of organizations such as the family, the guilds, and the realm, which he thought essential to the economic life of the nation. In his role of fulltime historian, Cunningham, as reported by Foxwell, was mostly resented by his Cambridge colleagues for his contempt towards economic theory, a position which Foxwell himself had fought against in the early days of their friendship. As the years passed, though, Foxwell recognized that he had moved closer to Cunningham’s standpoint, that is, of total rejection of a theory that placed selfinterest as the supreme guide of human behaviour (Foxwell 1919: 388-389). Economic phenomena, for Cunningham and, admittedly for Foxwell, should be studied as the outcome of a complex interaction of human motives, involving not only material reasons, but also, and sometimes most importantly, ethical and psychological considerations. Cunningham’s lasting legacy, concluded Foxwell, lay in him raising British economic history to distinction within the nation’s academic world (ibid.: 390).

However, perhaps the most articulate of Foxwell’s presentations on the history of economic thought appeared in his 1899 introduction to Menger’s The Right to the Whole Produce of Labour. At the very beginning of his argument, Foxwell highlights what he considered to be the theoretical propensity of classical economists to neglect the aspects of economic action connected with the law, customs, and history. This most regrettable state of affairs, though, had been shaken by the advent of the Historical School, which highlighted the importance of positive law to the progress of society. The notions of ideal right and fairness, according to Foxwell, although repealed in some epochs, are always ahead of history, being the prime cause of change in habits, thinking and the law. In his own words: ‘It might with equal truth be said that the equity of one age becomes the law of the next. If positive law is the basis of order, ideal right is the active factor in progress’ (Foxwell 1899: xi).

The key for social stability, in Foxwell’s particular interpretation of social dynamics, lies in the gradual development of the ideas of right, and the concomitant development of positive institutions framed by these ideas. This proposition, however, does not mean, for Foxwell, that the ideas about the ideal right are always correct or free of contradiction. He understood this task as the most difficult one in view of the fact that few socialist proposals had been put into practice, particularly those of a more radical nature. In England, however, cradle of the modern industrial world, the socialist thinkers had addressed almost every malady of the capitalistic society, advancing all kinds of corrections and changes such as co-operativism, land reform, factory laws, trade unions, and even the revolutionary overthrow of the existing economic system (ibid.: xxv—xxix).

Making use of his vast dominion over the pertinent literature, Foxwell travels easily across the works of the main British reformers of the late eighteenth century and the whole of the nineteenth century. William Godwin (1756-1836) is considered to be the head of the reform movement, his Political Justice, owing to the combination of the ‘purest communism with the most individualistic anarchism’ (ibid.: xxix), being too optimistic and naive to exert any appeal to the revolutionary mind. William Thompson (17751833), for his part, is deemed to be the chief of the English Socialist School, due to the wide influence of his writings and his lifelong dedication to the movement. Like Godwin, Foxwell sees Thompson as excessively reliant on voluntary methods as the proper way to achieve that social equality so cherished by the critics of capitalism. This aside, Thompson’s lasting contribution to the socialist movement was to raise to centre stage of political economy the question of the most appropriate distribution of income (ibid.: xxxviii-xlvii). Less sympathetic towards orthodox classical economists, Foxwell reserved for John Stuart Mill (1806-1873) nothing less than the epithet ‘soporific’ (ibid.: lxxviii) for his overall negative influence by instilling in his readers a sense of finality. As for the father of British co-operativism, Robert Owen (17711858) is interpreted by Foxwell as the one person who really took the socialist ideal from books to the streets, making it the basis of a popular agitation. All advances in British social life of the time, from popular education to trade unionism, co-operativism, factory legislation, and sanitary reform, had been due, according to Foxwell, to Owenite campaigning (ibid.: lxxix-lxxxvii).

Foxwell also commented on the contributions made by other British socialists of the nineteenth century, such as Thomas Hodgskin (1787-1869) and John Francis Bray (1809-1897) (ibid.: lv-lxxi). However, the main recurring theme of his introduction to Menger’s volume revolves around the conception that although Owen could be named as the man who took the socialist ideal to the popular mind, Ricardo was really the one who provided the intellectual framework to the British socialist rhetoric. For Foxwell, almost all nineteenth- century socialist writers, even the revolutionaries, underpinned their critical arguments with portions of Ricardo’s writings about the class antagonism nurtured by the direct opposition between profits and wages. The instances

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where Foxwell repeats this claim are quite numerous, so to quote just one of them here will be illuminating enough:

It was Ricardo, not Owen, who gave the really effective inspiration to English socialism. That inspiration was stimulus indirect and negative, but it is unmistakable. Thompson and the rest took for granted the accuracy of Ricardo’s unfortunate and strained deductions, and quote him as an unquestioned authority. Finding that certain of his conclusions were abhorrent to their sense of right, and assuming that he had taken the existing conditions of society as his premises, they naturally directed all the force of their attack against these conditions. This was the real intellectual origin of revolutionary socialism, and it is for this reason I have called it Ricardian (Foxwell 1899: lxxxiii; see also xl, xli, lvi, fn. 1, lxxi).

Foxwell closes his presentation by highlighting the key contradiction in socialist thought, that is, the fact that the labourer should have the right to his whole product but in a system where the division of labour makes it impossible to ascertain how much each one has actually done in a complex productive process. This conceptual difficulty, explained Foxwell, can only acquire some meaning at the aggregate level, so that any socialist discourse tends to end up in a plea for equality and communism. An effective alternative to a revolutionary change, however, would be the gradual implementation of social legislation and progressive taxation to promote a better distribution of unearned incomes (ibid.: cv-cx).

• [1] The once curator of the Kress Library, Ruth Rogers, wrote the following about this second collectionput together by Foxwell: ‘The major categories of the collection are political economy, commerce, finance,taxation, money and banking, trades and manufactures, transportation, labor, socialism, and the economic aspects of agriculture. The published materials span the years from 1474 to 1850 and includesworks in all Western European languages’ (Rogers 1986: 282).