At the Origins of Mathematical Economics

The Economics of A.N. Isnard (1748-1803)

Richard Van Den Berg

• Publisher: Routledge
• Year: 2005
• Print ISBN: 9780415547635
• eBook ISBN: 9781134401482
• Edition: 1
• Topic: Business
• Subtopic: Business generale
• Index: Business

Achille Nicolas Isnard (1749-1803) an engineer with a keen interest in political economy, is best known for demonstrating the concept of market equilibrium using a system of simultaneous equations. The breadth and depth of his work undoubtedly established him as one of the forerunners of modern mathematical economics, yet his seminal contributions to the study of economics remained largely unrecognized until the latter half of the twentieth century.

This pioneering new book, the first in English, examines Isnard's life and illuminates his major contributions to political economy. It contains substantial extracts from a number of his publications presented both in English translation and in the original French so Isnard can now finally achieve his place at the heart of discussion on the origins of mathematical economics.

The diverse issues covered here will ensure that this book appeals not only to economists with an interest in the history of mathematical economics, but to anyone interested in the emergence of political economy and in wider social thought during the Enlightenment.

Part B
Texts and translation

On the following pages a selection of Isnard’s writings is presented in English translation alongside the original French texts. There are two main reasons why this form of presentation is chosen. First, original copies of most of Isnard’s publications are very rare. Including the French texts improves the accessibility of at least part of the engineer’s writings for those able to read the originals. Second, it is hoped that having the French printed next to the translations absolves the translator to some extent from having to justify the rendering in English of a large number of difficult terms and phrases. Isnard is not an easy author to translate, partly because his style of writing is at times less than fluent, but also due to the novel and technical nature of some of his thought. This leads the engineer to coin new terms or to use existing terms in idiosyncratic senses. While it has been tried in all cases to give faithful translations by resisting the temptation to improve upon formulations too much and by avoiding modern economic terms that express concepts that Isnard may not have had in mind, the reader may at any time refer to the original French wording. In that way when, for example, richesses foncières is somewhat unsatisfactorily translated as fixed capital the reader is in a position to disagree.

Throughout the texts the original pagination is indicated within square brackets. Occasionally, when it is judged essential for a right understanding, words have been added in the translation where they were absent in the original, again in square brackets. There are two types of notes: all original notes by Isnard use letters and are placed at the bottom of the page; all numbered notes are additions by the present writer.

Treatise on wealth

Containing the analysis of the use of wealth in general and of values; the natural principles and laws of the circulation of wealth, of its distribution, of trade, of the circulation of moneys and of taxation, and historical investigations into the changes the rights of public and private property have experienced in France since the beginning of the monarchy. (1781)

For the king has rights over all these things, while each citizen has the ownership of them.

Senec[a], de beneficiis, Lib. VII cap. 4. [2.8]

FIRST VOLUME

[v] Preliminary discourse about the necessity of education and about the subject of this work

[…]

[xii] Since my earliest youth I heard reasoning about politics, trade, and finance, and I much desired to reason about it too. As I grew older, I was surprised that the science of those subjects did not come to me, as it did to everybody else, by a specially infused grace of nature, and that one could talk so well about it without having studied it, while one had hardly anything to say about those subjects one had studied the most. Annoyed by this refusal of nature and because it responded so badly to my ardour (because I could not accept obscure ideas communicated to me by the organ of its favoured in exchange for the favours to which I aspired) I gave up pretending with the aid of grace and I decided to study.

The authors I have used can be divided into three classes. The first have developed the social system of M.Quesnay. This system is founded upon the right of property, and it has as its goal to reach the [xiii] largest possible population through the greatest affluence and the greatest wealth. Others have taken as their goal to achieve wealth through

Traité des richesses

Contenant l’ analyse de l’usage des richesses en général & de leurs valeurs ; les principes & les loix naturelles de la circulation des richesses, de leur distribution, du commerce, de la circulation des monnoies & de l’impôt, & des recherches historiques sur les revolutions que les droits de propriété publics & particuliers ont | éprouvées en France depuis l’origine de la Monarchic. (1781)

Ad reges potestas omnium pertinet, ad singulos proprietor.

Senec. De beneficiis, lib. VII, cap. 4.

TOME PREMIER

[v] Discourse Préliminaire sur la Nécessité de l’Instruction et sur l’Objet de cet Ouvrage

[…]

[xii] Dès ma plus tendre jeunesse, j’entendois raisonner sur la politique, le commerce & les finances, & je desirois beaucoup en raisonner aussi : je m’étonnois en avançant en âge, que la science de ces objets ne me vînt pas, comme à tout le monde, par une grace de nature spécialement infuse, & qu’on en raisonnât si bien sans l’avoir étudiée, tandis qu’on parloit a peine de celles que l’on étudioit le plus : ennuyé de ce refus de la nature & de ce qu’elle répondoit si peu a mon ardeur, (car je ne pouvois prendre les idées obscures qu’elles me communiquoit par l’organe de ses favoris pour les faveurs auxquelles j’aspirois) je renonçai de prétendre au secours de la grace & je résolus d’étudier.

Les auteurs dont j’ai fait usage peuvent être ranges en trois classes.

Les uns ont développé le systême social, de M.Quesnay ; ce systême est fondé sur le droit de propriété, & il a pour objet de parvenir à la plus [xiii] grande population qu’il soit possible par la plus grande aisance & la plus grande richesse. Les autres ont eu pour objet de parvenir à la richesse par

population, even disregarding the rights of property and the natural laws of production. Among the latter, some have adopted the political system of the English, following its principles favouring production and the trade of foodstuffs, others have adopted the maxims followed by minister Colbert¹ by sacrificing even production and the trade of foodstuffs to the interior population of states. Finally, the last ones have maintained various propositions of the preceding systems by combining the fundamental maxims of those systems.^d

In the course of this work we will demonstrate that M.Quesnay and the Economists who have followed his doctrine have established four erroneous propositions, to wit:

1. Agriculture is the unique source of wealth.
2. Industry does not multiply wealth.
3. Taxes can only be levied on the net product of the land.
4. The Sovereign is joint proprietor of the net product.

We will demonstrate that the English, Colbert and their sectarians have based their political laws on the wrong principles, and on maxims contrary to the natural rights of property, without which [xiv] no society can hope to arrive at the degree of prosperity to which it is susceptible.

This work is divided into two parts. In the first we will deal with wealth in general, the relations between different kinds of wealth, and their relation with circulation. We will examine what the natural laws of society are, and what are the rights proper to the conservation and the prosperity of states. We will see that the right of property is a fundamental right of societies. We will analyse goods useful to enjoyment and production, and the industry that produces them. We will demonstrate that the activity of man adds to the activity of nature, and increases the number of qualities produced by nature. It is in this way that industry multiplies wealth.

We will investigate in what manner agricultural goods and the products of industry acquire values and what their ratios are. We will compare the different kinds of wealth to each other, and then we will compare them to one of their number. This last comparison not only gives people the means to calculate the value of wealth by a numéraire or a common measure, but also to use the commodities that have the greatest value in the smallest volume as pledges of all others, and to employ them as moneys.

The results we will have discovered about values in general will be applied to the values of the works of men, of lands and of the interest of capital.

d The truest maxims of politics are often the result of false principles.

la population, au mépris même des droits de propriété & des loix naturelles de la production : parmi ces derniers, les uns ont adopté le systême politique des Anglois qui en suivant ces principes ont accordé les plus grandes faveurs à la production & au commerce des subsistances, les autres ont adopté les maximes qu’a suivies le ministre Colbert en sacrifiant même la production & le commerce des subsistances à la population intérieure des états ; les derniers enfin ont adopté des systêmes mixtes, & ont soutenu les systêmes précédens, en employ ant alternativement les maximes fondamentales de ces systêmes.^(d)

Nous démontrerons dans le cours de cet ouvrage que M.Quesnay & les économistes, qui ont suivi sa doctrine, ont établi quatre propositions erronées, savoir :

1°. L’agriculture est l’unique source de richesse.

2°. L’industrie ne multiplie pas les richesses.

3°. L’impôt ne doit être pris que sur le produit net des terres.

4°. Le souverain est co-propriétaire du produit net.

Nous démontrerons que les Anglois, Colbert & leurs sectateurs, ont établi leurs loix politiques sur de faux principes, & sur des maximes contraires aux droits naturels de la propriété, sans lesquels [xiv] nulle société ne peut espérer parvenir au degré de prospérité dont elle est susceptible.

Cet ouvrage sera divisé en deux parties. Dans la premiere nous traiterons des richesses en général, de leurs rapports entr’elles, & de leur rapport avec la circulation.

Nous examinerons quelles sont les loix naturelles de la société, & les droits propres à la conservation & à la prospérité des états. Nous verrons que le droit de propriété est un droit fondamental des sociétés.

Nous ferrons l’analyse des biens propres aux jouissances & à la production, & de l’industrie qui les produit. Nous démontrerons que l’action des hommes ajoute à l’action de la nature, & accroît le nombre des qualités produites par la nature, c’est ainsi que l’industrie multiplie les richesses.

Nous rechercherons de quelle maniere les biens de la terre & les productions de l’industrie acquierent des valeurs & quels sont leurs rapports. Nous comparerons les richesses entr’elles, & nous les comparerons ensuite a une d’elles ; cette derniere comparaison donne aux hommes le moyen non seulement de calculer la valeur des richesses sur un numéraire ou sur une mesure commune, mais encore de se servir de marchandises qui ont le plus de valeur sous le moins de volume comme gages de toutes les autres, & de les employer comme monnoies.

Les résultats que nous aurons découverts sur les valeurs générates seront appliqués aux valeurs des travaux des hommes, des biens fonds & de l’intérêt des capitaux.

(d) Les maximes les plus vraies de la politique sont souvent dans les auteurs le résultat de faux principes.

We will see in what manner the quantities of each type of wealth are determined, and what [xv] are the limits to their increase, and the ratios according to which sources of products are allocated.

Among the total mass of wealth we will make a distinction between that part which is employed in production and that employed for the enjoyment and consumption of men. The former is necessary to production the latter is disposable. One should employ as much wealth as possible in production in order to increase general wealth. But economy dictates that the employment of productive expenditures is directed in such a way that the costs are as small as possible relative to production. It is a mistake to maintain that there is any kind of wealth that does not yield a net product, or a product above costs. Of all particular kinds of products, one part belongs to production, the other to enjoyment. The sum of the parts belonging to production forms the general mass of the costs of production, the sum of the other parts forms the general mass of disposable wealth. The values of individual products determine the share of the total mass of disposable wealth that devolves to each producer. This share varies with the difference between the values of products and of the objects necessary to production, which the producer has to purchase.

After having dealt with wealth in general and the relations between different kinds of wealth, we will analyse their circulation, first between the classes of citizens, then in relation to expenditures, consumption and sale. On the one hand the order of expenditures is determined by the distribution of wealth, on the other hand by the necessary ratio between the costs of production and [xvi] objects of enjoyment. The expenditures of production assist and favour one another mutually. The consumption of objects of enjoyment also favours the expenditures of production.

Agriculture or the production of subsistence goods is the source of other products. When agricultural nations neglect the cultivation of their lands and employ their productive capitals in an artificial manner contrary to the natural order, they adorn themselves with false splendour, and ruin the fundaments of their political structure.

Industry is the daughter of agriculture, and contributes with the latter to the growth of wealth of the state. Both need to be nourished and maintained by the total mass of wealth. They need productive capitals and productive expenditures. Agriculture prospers under the reign of liberty. She still retains some productive capitals when the yoke of oppression weighs her down. Industry is more fickle. She requires the assiduity of a skilful courtesan to inspire confidence in her, to assure her the protection and liberty she requires.

Nature has provided for the propagation of men and animals. Man is rather weak when he wants to add to the fundamental laws of nature. For the increase and multiplication of wealth she requires the labour of men,

Nous verrons de quelle maniere les quantités de chaque espece de richesses sont déterminées, & quelles [xv] sont les limites de leur accroissement, & les rapports entre lesquels elles se partagent entr’elles les sources de leurs productions.

Dans la masse totale des richesses nous ferons une distinction de celles qui sont employées à la production & de celles qui sont employées aux jouissances & à la consommation des hommes; les unes sont nécessaires à la production, les autres sont disponibles. Il faut employer les plus de richesses qu’il soit possible à la production pour accroître la richesse générale : mais l'économie dicte de diriger l’emploie des dépenses productives, de maniere que les frais soient les moindres qu’il soit possible relativement à la porduction. C’est une erreur de soutenir qu’il y a quelque espece de richesses qui ne donne point de produit net ou de produit au-delà des frais. De toutes les especes particulieres de productions, une partie est propre à la production, l’autre a la jouissance; la somme des parties propres à la production forme la masse générale des frais de production, la somme des autres parties forme la masse générale de richesses disponibles. Les valeurs des productions particulieres déterminent la portion de la masse totale des richesses disponibles qui revient à chaque producteur; cette portion varie à raison de la difference des valeurs des productions, & des objets propres à la production que le producteur est oblige de se procurer.

Après avoir traité des richesses en générale & de leur rapport, nous analyserons leur circulation, d’abord entre les classes des citoyens, ensuite dans son rapport avec les dépenses, la consommation & le débit. D’une part l’ordre des dépenses est déterminé par la distribution des richesses, de l’autre par le rapport nécessaire des frais de production aux [xvi] jouissances. Les dépenses de production se servent & se favorisent mutuellement; la consommation des jouissances favorise elle-même les dépenses de production.

L’agriculture ou la production des subsistances est la source des autres productions. Lorsque les pays agricoles négligent la culture de leurs terres, & qu’ils n’emploient leurs capitaux productifs d’une maniere factice & contraire à l’ordre naturel, ils se parent d’une fausse splendeur, & ruinent leur édifice politique par les fondemens.

L’industrie est fille de l’agriculture, & contribue avec elle à l’accroissement des richesses de l’état ; l’une & l’autre ont besoin d’être nourries & entretenues sur la masse totale des richesses; elles ont besoin de capitaux productifs & de dépenses productives. L’agriculture prospère sous le regne de la liberté ; elle retient encore quelques capitaux productifs lorsqu’elle est pliée sous le joug de l’oppression : l’industrie est plus volage ; elle exige de l’assid...

Table of contents

• Cover Page
• Title Page
• Copyright Page
• Foreword
• Acknowledgements
• Introduction
• Part A: The economics of A.N.Isnard
• Part B: Texts and translation
• Appendix
• References