Jean-Baptiste Say and the Classical Canon in Economics: The British Connection in French Classicism

Published by EH.NET (December 2005)

Samuel Hollander, Jean-Baptiste Say and the Classical Canon in Economics: The British Connection in French Classicism. New York: Routledge, 2005. xiii + 322 pp. $150 (cloth), ISBN: 0-415-32338-X.

Reviewed for EH.NET by Maria de F?tima Brand?o, Faculdade de Economia, Universidade do Porto, Portugal.

Jean-Baptiste Say and the Classical Canon in Economics by Samuel Hollander (University Professor Emeritus, University of Toronto and Professor of Economics at the Department of Economics, Ben-Gurion University), is the latest component of a long-term research project that began to bear fruit in the early 1970s, with the publication of The Economics of Adam Smith (1973), followed thereafter by The Economics of David Ricardo (1979), The Economics of John Stuart Mill (1985), Classical Economics (1987) and The Economics of Thomas Robert Malthus (1997). From another perspective, this book also bears witness to a renewed interest in the work of Jean-Baptiste Say since the mid-1990s, together with Palmer’s J.-B. Say: An Economist in Troubled Times (1997), Forget’s The Social Economics of Jean-Baptiste Say (1999), Whatmore’s Republicanism and the French Revolution: An Intellectual History of Jean-Baptiste SayZs Political Economy (2000), the recent reprint of A Treatise on Political Economy (2001), and the collection of essays Jean-Baptiste Say: Nouveaux regards sur son oeuvre (2003).

Samuel Hollander’s approach in the book under review stems from his concern with the classical canon in economics. This concern underlies both the much older argument on the absence of a revolutionary break between classical and neo-classical economics and the newer one on the absence “of a paradigmatic clash between the economics of Jean-Baptiste Say and of David Ricardo” (p. 1). In fact the earlier emphasis on “the French connection in British classicism” (Hollander 1982), paved the way to the present emphasis on “the British connection in French classicism” and the recognition of Say’s economics as part and parcel of canonical classicism, considering “Say’s adherence to much of Ricardian theory” (p. 1). The evidence in favor of a substantive agreement between the representatives of the British and the French classicism is collected from the careful reading of Say’s major economic works, reviews, articles and correspondence, and it is presented throughout the text by means of the transcription of as many excerpts from the original texts in French and English as are regarded adequate for the purposes of the argument. Meticulous attention is paid to the changes introduced in the several editions of the Trait? d’?conomie politique between 1803 and 1826, and to the last statement of Say’s economics in the Cours complet d’?conomie politique of 1828-29.

The Introduction provides a summary view of the author’s interpretation of Ricardo and a review of the literature on the Ricardo-Say relation. The next four chapters give account of the evolution of Say’s position on value, distribution and growth (2 and 3), on the nature of riches (4), and on the Law of Markets (5). Chapter 6 offers an overview of Say’s adherence to the classical canon, as regards substantive methodological and doctrinal matters, mostly in the context provided by the Ricardo-Say-Malthus exchanges. The Conclusion is reserved to disclaim the general impression of systemic discord between Say and Ricardo.

As a result of the research undertaken, Hollander’s offers a canonical interpretation of Say’s economics, which is made essentially dependent upon the establishment of the correspondence between doctrine of services and cost theory, the identification of riches with utilities, and the fundamental principle that aggregate demand is regulated by production. On methodological grounds, Say’s canonical position is built upon his overriding concern with the establishment of general principles, on the basis of an adequate empirical justification. Say therefore emerges as a classical theorist on his own and as a net contributor to a line of scientific inquiry inaugurated by Smith and developed into canon by Ricardo and the contributions of Malthus and Stuart Mill.

SayZs methodological credentials are convincingly asserted, when his insistence on a practical political economy is placed in the context of his strict allegiance to the vision of a political economy committed to the establishment of a body of universally valid principles, regardless of the circumstances of time and place that underlay their sound application to the understanding of particular problems and situations. In the same manner, Say’s advocacy of Bacon’s experimental method is placed in the context of his insistence “upon regarding the building up of general principles as basis for deductive exercises and the derivation of causal relations” (p. 234). Moreover, the stance against the Ricardian School is not regarded as being at variance with the “Ricardian methodological principle,” given the circumstance that Say’s “concern was to establish a proper empirical justification for the axiomatic base and assure responsible application, not to introduce an alternative ‘inductive’ method” (p. 248).

Say’s doctrinal credentials are also convincingly asserted, as regards the Law of Markets. Temporal priority over James Mill is formally ascribed to Say, and he is cleared of the charge that he “emptied the law of all content by definitional sleights-of-hand” (p. 24). Care is taken to contest Forget’s assertion that “Say’s amalgamation of the law [of markets] with his analysis of entrepreneurship allows us to distinguish his own use of the concept from that of the classical school” (2003: 60). As proof to the contrary, reference is made to the tribute paid to Say by Ricardo, on account of “the principle of the Law of Markets … whereby (balanced) growth can proceed at cost-covering prices unchecked by aggregate-demand constraints” (p. 224, author’s emphasis).

Say’s doctrinal credentials regarding value and related distribution and growth issues are painstakingly presented, in order to document the “substantive identity of Say’s doctrine of services and Ricardian cost theory” (p. 23), with due emphasis being laid on Say’s subscription to the zero-rent, demand-determined extensive margin, to the inverse wage-profit relation, and to riches as a utility entity rather than as a value. However, it is precisely in this domain that Hollander’s interpretation of Say’s economics is most susceptible to give rise to critical examination. As a matter of fact, there is a systemic discord between the appraisal of Say’s economics put forward in this book and the appraisals to be found in most of the relevant literature. Suffice it to mention the contributions of Steiner (1998, 2003) and Gehrke and Kurz (2001), which stress the disagreement between Say and Ricardo in matters pertaining to value and distribution, on account of the role played by demand and supply. From a different perspective, suffice it to mention the contribution by Arena (2001), which places Say in the context of a French classical school that diverges on substantive matters from the British classical school. In consequence, it is only to be expected that the publication of Jean-Baptiste Say and the Classical Canon in Economics will give rise to a debate on HollanderZs canonical interpretation of Say that is as lively as the one that followed the presentation of the canonical interpretation of Ricardo in The Economics of David Ricardo.

References:

Arena, R. (2001) “J.-B. Say and the French Liberal School of the Nineteenth Century: Outside the Canon?” in Reflections on the Classical Cannon in Economics, E.L. Forget and S. Peart (eds.), London and New York, Routledge, pp. 205-23.

Forget, E.L. (1999) The Social Economics of Jean-Baptiste Say: Markets and Virtue, London, Routledge.

Forget, E.L. (2003) “Jean-Baptiste Say and the Law of Markets: Entrepreneurial Decision-Making in the Real World” in Two Hundred Years of Say’s Law, S. Kates (ed.), Cheltenham, Edward Elgar, pp. 39-66.

Gehrke, C. and H.D. Kurz (2001) “Say and Ricardo on Value Distribution,” European Journal of the History of Economic Thought 8 (4), pp. 449-86.

Hollander, S. (1982) “On the Substantive Identity of the Ricardian and Neo-classical Conceptions of Economic Organization: The French Connection British Classicism,” Canadian Journal of Economics 15 (4), pp. 586-612.

Palmer, R.R. (1997) J.-B. Say: An Economist in Troubled Times, Princeton, Princeton University Press.

Potier, J.-P and A. Tiran, editors (2003) Jean-Baptiste Say: Nouveaux regards sur son oeuvre, Paris, Economica.

Say, J.-B. (2001) A Treatise on Political Economy, with a new introduction by M. Quddus and S. Rashid, New Brunswick, Transaction Publishers.

Steiner, P. (1998) “Jean-Baptiste Say: The Entrepreneur, the Free Trade Doctrine and the Theory of Income Distribution” in Studies in the History of French Political Economy: From Bodin to Walras, G. Faccarello (ed.), London, Routledge, pp. 196-228.

Steiner, P. (2003) “La th?orie de la production de J.-B. Say/La production de richesses: les lessons du d?bat avec Ricardo” in Jean-Baptiste Say: Nouveaux regards sur son oeuvre, J.-P. Potier and A.Tiran (eds.), Paris, Economica, pp.325-60.

Whatmore, R. (2000) Republicanism and the French Revolution: An Intellectual History of Jean-Baptiste SayZs Political Economy, Oxford, Oxford University Press.

Maria de F?tima Brand?o teaches economic history and history of economic thought at the Faculdade de Economia, Universidade do Porto, Portugal. She co-authored, with Ant?nio Almodovar, “La civilisation marchande et la discipline ?conomique chez Jean-Baptiste Say” (in Jean-Baptiste Say: Nouveaux regards sur son oeuvre, J.-P. Potier and A. Tiran (eds.), Paris, Economica, 2003, pp. 127-46) and “On Building up a Market Society: Lessons from the Wealth of Nations and The Great Transformation” (in Economic Transition in Historical Perspective: Lessons from the History of Economics, C.M.A. Clark and J. Rosicka (eds.), Aldershot, Ashgate, 2001, pp. 43-62).