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Published by EH.NET (July 2004)

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David Colander, Robert E. Prasch, and Falguni A. Sheth, editors, Race, Liberalism, and Economics. Ann Arbor: University of Michigan Press, 2004. x + 334 pp. $65 (hardcover), ISBN: 0-472-11356-9.

Reviewed for EH.NET by Stanley Engerman, Department of Economics, University of Rochester.

This collection of eleven essays, almost all by economists, deals with questions relating to the political and philosophical background of economic thought, as well as to issues of public policy, as reflected in past and present attitudes to race and racial discrimination. Based upon a conference held at Middlebury College, the originating point was David Levy’s controversial book, How the Dismal Science Got Its Name: Classical Economics and the Ur-Text of Racial Politics (2001). In that book, and in the two essays here co-authored (with Sandra J. Peart), it is argued that, in the mid-nineteenth century, it was the laissez-faire economists who tended to be non-racist, while those often proclaimed as anti-capitalist social reformers, such as Dickens, Carlyle, and Ruskin, were more likely to be racist and pro-slavery (or, at the least, to be willing to delay emancipation until the time that the slaves were ready for freedom). To Levy and Peart, the economists conclusions follow from “their presumption of human homogeneity,” so “that the social world is composed of equally competent optimizers,” and “there is no group that needs looking after and no group that can do the looking after” (p. 57).

Most essays deal with particular economists and their attitude towards racial distinctions. After surveying the views of several economists and social scientists, including J.B. Clark, John Commons, W.E.B. Du Bois, Abram Harris and Sterling Spero, Gunnar Myrdal, Gary Becker, and Thomas Sowell, Robert E. Prasch suggests “that the existence of this literature is itself evidence of an erosion in the harshness and degree of discrimination in America,” (p. 178) as well as demonstrating a more analytical and empirical approach to its study.

There is one direct onslaught on the Levy argument, by Susan Zlotnick, who praises Carlyle, Dickens, and Ruskin for their “critique of unrestrained capitalism,” (p. 97) and generally criticizes Levy (and Peart) both for misinterpretations of these authors and also for a failure to understand the nature of modern-day literary criticism. There is a delightful air of nastiness to Zlotnick’s critique, and to Levy and Peart’s discussion of her points, but since they, in effect, focus on different issues of moral evaluation there is no need to reach a clear-cut decision on this debate.

Other essays deal with the central topic of racism and social sciences. They include one on the beliefs of natural scientists on human variation since the Enlightenment (Brendan O’Flaherty and Jill S. Shapiro), one on views of John Stuart Mill on “race, liberty, and markets” (Falguni A. Sheth), and a survey of some recent studies on “Racial Discrimination in the Labor Market” (William A. Darity, Jr. and Patrick L. Mason). All provide useful information and insights. The remaining essays do, in various ways, relate to the basic theme, but in more tangential manners. Glenn C. Loury presents a clarification (or defense) of his book, The Anatomy of Racial Inequality, ending by quoting Keynes: “when circumstances change I change my opinion” (p. 255). This is clearly something he has done in moving away from his earlier arguments focusing mainly on black responsibility. In an article not directly related to the principle issue of the book, Vanita Gowda and O’Flaherty advocate the economic and other benefits expected from better recreational drugs, particularly for African-Americans. David Colander discusses the best-mix of private markets and government control, in dealing with racial problems, and argues for a more pragmatic approach than we have become used to. And Marcellus Andrews cleverly analyzes the neoclassical model, and its role in free market ideology, drawing a distinction between classical liberalism and egalitarian liberalism, and the manners with which each deals with racism and racial discrimination.

As with all collections, some essays are more interesting and useful than others, and some are more relevant to the theme that the editors have chosen for this volume. In general, however, these essays are rather stimulating in dealing with such important questions as understanding the philosophical roots of some aspects of economic theory, describing the importance of changing ideas over time, both in society as well as in economics, and establishing that people, some of whose ideas we admire may also hold some beliefs that we find abhorrent.

Stanley Engerman is John Munro Professor of Economics and Professor of History at the University of Rochester.