Economists in Parliament in the Liberal Age
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Economists in Parliament in the Liberal Age

(1848–1920)

Marco E.L. Guidi, Massimo M. Augello, Massimo M. Augello

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eBook - ePub

Economists in Parliament in the Liberal Age

(1848–1920)

Marco E.L. Guidi, Massimo M. Augello, Massimo M. Augello

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About This Book

This detailed volume explores the role and actions of economists in US, Japanese and various European parliaments in the critical period between 1848 and 1920. Featuring chapters written by an international array of contributors from both economics and history, the book provides fascinating insights into the parliamentary life in the period. It highlights the often pivotal role of economists within each administration; examines their influence on policy making, their relationships with other MPs, civil servants, external economic associations and looks at the influence of public opinion on economic policy. The book also discusses the nature of the economic discourse practised in the parliamentary arena, considering the complex relationships between science and practice, and between politics and political economy in light of the evolution of economics during this period. The book is the first of its kind to provide a comparative framework for analysis, and will appeal to economists and historians alike.

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Publisher
Routledge
Year
2017
ISBN
9781351941778

Chapter 1

Economists in Parliament in the Liberal Age:
A Comparative Perspective

Massimo M. Augello and Marco E.L. Guidi*

Introduction

Since the pioneering works of Roger Church, Bob Coats, and William Barber1 on the sociology of the profession of economics, the problem of economists’ involvement in politics has attracted the attention of historians of economic thought. In a broader perspective, the evolution of this connection from the age of Antoine de Montchrestien’s TraictĂ© de l’oeconomie politique (1615)2 to the era of professional economics seems crucially related to the changing nature of economic science, which has gradually been transformed from an ingredient of legislators’ and bureaucrats’ wisdom to a formalised science, with rigorously defined distinctions between pure and applied economics, or between science and art.
In this evolution, the nineteenth and early twentieth century represent an age of crucial changes. Classical political economy spread into different areas of the world, enlightening public opinion and the ruling elites with what was presented as a scientific analysis of market mechanisms and the benefits of free competition. Anti-market visions based on archaic moral and religious values did not disappear altogether, although they were endorsed only by a conservative minority. In many European countries, in the United States and Japan, the message of political economy – itself often associated with religious views – became the banner of groups of intellectuals who founded associations, journals and political movements in favour of free trade.3 At the same time, the importance of the science of political economy as part of the education of future bureaucrats and politicians was recognised by the governments of many countries, leading to its institutionalisation in the legal and philosophical curricula of universities.4 Furthermore, the new approaches that emerged in the second half of the nineteenth century, despite their critical stance towards deductive reasoning and laissez-faire, insisted on the scientific character of economic science, while its political implications became more evident thanks to the prevailing interventionist attitude. Finally, the marginalist revolution of the 1870s definitively imposed the scientific canons the majority of economists still adopt today, but the attempts to construct a pure, wertfrei theory inaugurated by Stanley W. Jevons and his contemporaries clashed with the strong political commitment of many neo-classical economists, who seemed to deduce their policy recommendations directly from the theoretical constructions they had elaborated. Thus the scientific status that political economy acquired over the century increased, rather than reducing, the political implications of economic knowledge and expertise, providing political debate with new powerful arguments.
This process was accompanied by a parallel evolution affecting the galaxy of experts on economic questions. This evolution was conditioned by two crucial changes: the new status of economic science and transformations in the political scenario. In the seventeenth and early eighteenth century, the vast majority of economic authors were philosophers and bureaucrats who aimed at influencing the decisions of absolute monarchs in favour of the interests they supported, or simply for the sake of their own career at court. By contrast, the chapters collected in this book, focusing on the second half of the nineteenth century, unveil a fascinating and polymorphous world of specialised experts in the new science of political economy, whose training and professional background was only partially a result of the ongoing process of academic institutionalisation of economic disciplines. From Portugal and Spain to Germany, the rise of constitutional regimes favoured the emergence of pre-professional figures of politicians with a solid scientific and technical background who specialised in economic questions, while the expansion of the State machinery and the rise of central banks and other national and international institutions of economic governance5 promoted the creation of specialised economic and statistical services, in which a new generation of civil servants received a comprehensive and original economic training. As to the growing number of academic economists, the osmosis between scientific and political activity was intense. On the one hand, the proportion of members of parliament and ministers out of the total number of university professors of economics was in some cases very high,6 and in others considerable;7 on the other hand, especially at the early stages of institutionalisation, there were cases of members of the establishment who were appointed professors of political economy and public finance after a brilliant political career.
The study of economists’ political activity in the period of consolidation and spread of economic science is therefore a very promising subject. The role played by economists in Parliament is interesting for at least two reasons. First, in mid-nineteenth-century Europe, and some decades later in Japan, Parliament became the centre of the political life and the starting point of careers in government. Even in the British ‘mixed constitution’ and in the American federal organisation, both enjoying a more ancient parliamentary tradition, the mid-nineteenth century represented an age in which Parliament wielded a greater power than before (and after). Second, lawmaking was in Parliament the last act of a long chain of events starting with the introduction of bills and proceeding with lengthy debates, which are recorded in the volumes of parliamentary reports. Debates demand issues, and it is interesting to explore whether or not political economy provided consistent arguments for discussion, and how these arguments interacted with other questions of a political or social nature.
Despite this, studies on the role of the economists in Parliament and in government are still a rarity. The British case is probably the only exception,8 but the two remarkable studies by Barry Gordon (1976, 1979) cover the period preceding the Reform Bill of 1832, focusing on the cases of Ricardo and Joseph Hume, while Frank W. Fetter’s (1980) famous book arrests its analysis in 1868. Other works on political debates involving the participation of economists are also limited to the golden age of classical political economy, and focus on the typical issues discussed by classical economists: colonies, the Corn Laws, the Poor Laws, the machinery question, etc.9 An important comparative study on the Economists in Government was coordinated by Bob Coats,10 including research on Britain, Australia, India, Norway, the US, Israel, Hungary, Japan, Italy and Brazil. However, this work covers the period after WW2 and focuses on the activity of ‘professional’ economists employed as government consultants. Introducing the issue of History of Political Economy that contained the results of this research, Coats significantly stated that: ‘Although “economists” of one sort or another have tendered advice to governments from time immemorial, the practice of employing any significant number of professional economists in government did not become widespread until World War II’:11 an assertion that the present book contributes to reconsidering, unless a very narrow notion of ‘professional economist’ is adopted.
A recent collective research project has delved into the role of economists in the Italian Parliament in the period between the political unification of Italy (1861) and the rise of the Fascist regime (1922),12 and an analogous investigation is now in progress in Portugal. The present collection presents an overview of this phenomenon in these and other six countries of Europe (Spain, France, Belgium, the United Kingdom, Germany and Greece), as well as in the United States and Japan. In each chapter, the contribution of economics to parliamentary debates and the role played by different categories of economic experts in Parliament and in government during the so-called ‘liberal age’ is interpreted in the light of the relevant social, political and intellectual evolution and of the path followed by the institutionalisation and early professionalisation of economics. These contributions raise a number of interesting questions and aim at stimulating more detailed research on the relationships between economic science and politics and on the consequences, both for the development of economic legislation and the evolution of economics, of the political commitment displayed by economists.
The present chapter attempts a first comparative analysis of the cases examined in the volume. The next section presents the interpretive questions which prompted the research project on the economists in Parliament and the contributions this study may make to the advancement of research on the history of economic thought. The remaining three sections discuss some methodological problems related to research on this topic, and specifically:
  • the definition of ‘liberal age’, its periodisation and applicability to different countries;
  • the definition of ‘economist’ that is chronologically and geographically most appropriate to the cases in question, against the backdrop of the relationships between economics and politics;
  • the contribution of the discourse on political economy to parliamentary debates and to legislation.
A concluding section highlights some further research developments that may be stimulated by this book.

The economists in Parliament and the history of economics

The chapters that compose this book have been written by historians of economic thought, and inevitably the questions they raise are those most relevant for their research. This may be viewed as a limit, which calls for further interdisciplinary attempts to assess the relationships between the economists’ activities in Parliaments and, to cite only two examples, the evolution of political discourse or the formulation of economic policies in different countries or areas.
At the most elementary level, this book answers a basic need for documentation. In some cases, a first inventory of the main economic debates in Parliaments had to be attempted, while in other cases it was necessary to extend already existing knowledge of single important episodes to attain a more systematic level of understanding on the role played by political economy in parliamentary debates. The typical questions raised at this level of analysis concern the continuity, extent and depth of parliamentary debates on economic issues; the nature of economic arguments employed by the protagonists of these debates; the presence or absence of significant references to current economic literature and to the classics of economics, and the interrelations between economic analysis and arguments of a political or ideological nature.
A parallel cluster of questions is of a more sociological character and concerns the protagonists of economic debates, their social and professional origins, their knowledge of the scientific literature on political economy, their political stance, their affiliation to different schools of economic thought and the consequences of these characteristics for the issues to which they devoted their parliamentary activities. Another relevant problem is that of the degree of specialisation and proficiency of eminent members of parliament in the science of political economy, as revealed both by the content of their public speeches and by their writings on political economy, as well as by their involvement in the institutionalisation and spread of political economy.
A third important group of questions has to do with the activities and behaviour of economists and experts of economic problems in Parliament. The papers published in this book investigate the intensity of their commitment in political debates and lawmaking, exploring whether they focused exclusively on issues related to economic policies or on other non-economic topics, and to what extent they differentiated themselves from their parliamentary colleagues. In some cases useful information can be gleaned on the parliamentary economists’ political career and the ways in which they were recruited into the political class, the compromises they were compelled to accept, their relations with their constituencies, etc. Finally, the economists’ behaviour in Parliament is also a crucial subject of inquiry, since it is interesting to ascertain whether they adopted a particular attitude, preferring some activities rather than others, or simply acted like any other politician. This question invests the extent to which the message of political economy was transmitted to the political debate and the compromises that were established between the point of view of economic science and the ordinary logic of politics.
Clearly, a basic assumption of our work is that documenting economic debates in Parliament and the role played therein by economists is not a matter of pure curiosity. It answers a more fundamental purpose, that of understanding the nature and inner evolution of economic discourse in a crucial age of consolidation, spread and transformation. From this point of view, the analysis of the presence or absence of political economy in parliamentary debates and of the role played in such debates by more or less ‘professional’ experts of economics can be considered a litmus test for revealing some essential features of the discourse on political economy.
To begin with, the fact that some eminent classical economists such as David Ricardo and John Stuart Mill sat in the British Parliament, and that their example was followed by other leading economists in France, Germany, Belgium, Italy, and Spain is a signal of the strong political implications of their conception of economics. More specifically, it reveals that classical political economy implied as an essential part not only a general laissez-faire recommendation in foreign trade, the poor laws or the regulation of labour and production, but also a precise programme of institutional reforms aiming at radically transforming the attitude of government vis-à-vis economic regulation. The decisive encouragement James Mill gave to Ricardo’s election in 1818 and the daily discussions between the former and Jeremy Bentham on parliamentary agenda13 may be taken as a symbolic example of the close connection between classical political economy and institutional reform. In the British case the main problem was represented by the power of monopo...

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