Econ 406

Econ 406 History of Economic Thought

Spring 2010

Frederic S. Lee

[Download the syllabus in pdf]

Prerequisites:  Successful Completion of Economics 201, 202 (or equivalent); and the completion of the WEPT test.

Lectures: Monday, Wednesday, 4.00 – 5.15pm, Haag Hall Room 109

Required Texts:

  • E. K. Hunt, History of Economic Thought
  • R. Heilbroner, Teachings from the Worldly Philosophy

Optional Texts:   

  • V. Walsh and H. Gram, Classical and Neoclassical Theories of General Equilibrium
  •  A. Roncaglia, The Wealth of Ideas:  A History of Economic Thought
  • P. M. Lichtenstein, An Introduction to Post-Keynesian and Marxian Theories of Value and Price

Assessment: 

  • Mid-Term Test March 24, 2010 and is worth 20% of your final grade
  • Final Exam, May 7, 2010 at 8.00 to 10.00am and is worth 40% of your final grade.
  • Paper is due on April 21, 2010 and is worth 40% of your final grade.

Paper:  Information about the paper will be distributed.

Problem Sets (download pdf file)

Writing: s this course requires a good deal of writing, and your writing skills will partially determine your ability to express your understanding of theory, you may want to take advantage of the College’s Writing Center. See below.

Course Description:    The aim of the course is to delineate a particular body of economic theory called the surplus approach.  This body of theory starts with Sir William Petty in 1660s and continued through Adam Smith, David Ricardo, Karl Marx, Wassily Leontief, Michael Kalecki, Joan Robinson, and Piero Sraffa and futher developments from 1960 onwards.  Its main theoretical issues are the nature of production, origin of profits, determination of prices, the distribution of income, accumulation and economic growth, and the stability and/or demise of capitalism.

LECTURE AND READING OUTLINE*

The lecture series and readings are not designed to simply duplicate each other. While they are to some extent complementary, each is an independent entity, and the student will find that the lectures do not cover many points in the readings, and lectures will introduce arguments not contained in the readings. You must be responsible and take both readings and lectures seriously and not view them as substitutes.

Lecture Notes (download pdf file)

 

*Bold: Required Readings

I.  Surplus Theoretic Framework:  An Introduction

A.        Surplus Theories

  1. Hunt, History of Economics Thought, ch. 1.
  2. Walsh and Gram, Classical and Neoclassical Theories, ch. 2.
  3. Roncaglia, The Wealth of Ideas, chs. 1-2.
  4. Lichtenstein, An Introduction to Post-Keynesian and Marxian, part II and III.

B.        Long Period Method of Economic Analysis

C.        Deviations from Long Period Positions

D.        Circular Production vs. Linear Production

 

II.        Surplus Models Prior to 1800

A.        Sir William Petty

  1. Walsh and Gram, Classical and Neoclassical Theories, ch. 2.
  2. Roncaglia, The Wealth of Ideas, ch. 3.

B.        Richard Cantillon

  1. Walsh and Gram, Classical and Neoclassical Theories, ch. 2.
  2. Heilbroner, Teachings from the Worldly Philosophy, pp. 29-34.
  3. Roncaglia, The Wealth of Ideas, ch. 4.
  4. Cantillon, R.  Essai sur la Nature du Commerce en General, part I.

C.        Francois Quesnay and the Physiocrates

  1. Hunt, History of Economics Thought, ch. 2.
  2. Heilbroner, Teachings from the Worldly Philosophy, pp. 35-40.
  3. Walsh and Gram, Classical and Neoclassical Theories, ch. 2.
  4. Roncaglia, The Wealth of Ideas, ch. 4
  5. Quesnay, F.  Quesnay’s Tableau Economique.

D.        Adam Smith

  1. Hunt, History of Economics Thought, ch. 3.
  2. Heilbroner, Teachings from the Worldly Philosophy, pp. 72-98.
  3.  Walsh and Gram, Classical and Neoclassical Theories, ch. 3.
  4. Roncaglia, The Wealth of Ideas, ch. 5.
  5. Smith, A.  Wealth of Nations, Book I, chs. 1-9; and Book II, chs. 1-5.

III.       Full Flowering of the Classical Surplus Models, 1800 – 1870

A.        David Ricardo and the Corn Model

  1.  Langer, G. F.  1988.  “Corn:  A Classical Landscape.”  Economic Notes 17.1:  5 – 21.
  2. Ricardo, D.  1815.  “An Essay on the Influence of a Low Price of Corn on the                                Profit of Stock.”  In Pamphlets and Papers, 1815 – 1823, Vol. 4, The Works and Correspondence of David Ricardo, pp. 1 – 42.  Edited by P. Sraffa.  Cambridge:  Cambridge University Press, 1966.

B.        David Ricardo and Linear Production

  1. Hunt, History of Economics Thought, ch. 5.
  2. Heilbroner, Teachings from the Worldly Philosophy, pp. 110-126.
  3. Walsh and Gram, Classical and Neoclassical Theories, ch. 4.
  4. Roncaglia, The Wealth of Ideas, ch. 7.
  5.  Ricardo, D.  1821.  On the Principles of Political Economy and Taxation, Vol. 1, The Works and Correspondence of David Ricardo, ch. 1.  Edited by P. Sraffa.  Cambridge:  Cambridge University Press, 1975.

C.        Karl Marx and Circular Production

  1. Hunt, History of Economics Thought, chs. 7, 9.
  2. Heilbroner, Teachings from the Worldly Philosophy, pp. 161-195.
  3. Walsh and Gram, Classical and Neoclassical Theories, ch. 4.
  4. Roncaglia, The Wealth of Ideas, ch. 9.
  5.  Claeys, G.  1987.  Machinery, Money and the Millennium:  From Moral Economy to Socialism, 1815 – 1860.  Princeton:  Princeton University Press.
  6. Marx, K.  Wage, Labor and Capital and Value, Price and Profit
  7. Lichtenstein, An Introduction to Post-Keynesian and Marxian, part V.

IV.       The Underground Years

A.        The Rise of a New View of Production and Exchange

  1. Roncaglia, The Wealth of Ideas, ch. 10.
  2. Bharadwaj, K.  1986.  Classical Political Economy and Rise to Dominance of Supply and Demand Theories.  Calcutta:  Longman Orient.

B.        V. K. Dmitriev and the Theory of value of David Ricardo

  1. Dmitriev, V.  1974.  V. K. Dmitriev:  Economic Essays on Value, Competition and Utility.  Edited by D. M. Nuti.  London:  Cambridge University Press, pp. 39 – 80.

C.        Von Bortkiewicz and Marx’s Transformation Problem

  1. L. von Bortkiewicz, “On the Correction of Marx’s Fundamental Construction of the Third Volume of Capital,” in P. M. Sweezy (ed.) Karl Marx and the Close of his System.
  2.  R. L. Meek, Smith, Marx and After, pp. 95 – 145.

D.        Rosa Luxemburg and the Accumulation of Capital

  1. Hunt, History of Economics Thought, ch. 13.
  2. Howard, M. C. and King, J. E..  1989.  A History of Marxian Economics:  Volume I, 1883 – 1929.  Princeton:  Princeton University Press, ch. 6.
  3. R. Luxemburg, The Accumulation of Capital, section I.

V.        The Re-emergence of the Surplus Models, 1930 – 1960

A.        Wassily Leontief and Input-Output Analysis

  1. W. Leontief, The Structure of American Economy, 1919 – 1939.
  2. Kurz, H. D. and Salvadori, N.  2000.  “Classical Roots of Input-Output Analysis:  A Short Account of its Long Prehistory.”  Economic Systems Research 12.2:  153 – 179.

B.        Transformation Problem Revisited

  1. R. L. Meek, Smith, Marx and After, pp. 95 – 145.

C.        Kiel Group and the Capital Controversy of the 1930s

  1.  Nurske, R.  1935.  “The Schematic Representation of the Structure of Production,” Review of Economic Studies 2:  232-44.

D. Two Sector Models of Production, Prices, Profits, and Accumulation:  the work of Michael Kalecki, Joan Robinson, and Nicholas Kaldor

  1. Kalecki, M.  1943.  “Political Aspects of Full Employment.”  Political Quarterly               4:  322 – 331.
  2. Halevi, J.  1992.  “Kalecki and Modern Capitalism.”  Monthly Review 44.2 (June):  41 – 51.
  3. Robinson, J.  1956.  The Accumulation of Capital.  London:  Macmillan, chs. 7 – 22.
  4. Kaldor, N.  1955.  “Alternative Theories of Distribution.”  Review of Economic Studies 23 (March):  83 – 100.

VI.       The Re-establishment of the Surplus Theoretic Framework, 1960 – 1990

A.        Piero Sraffa, 1960

  1. Hunt, History of Economics Thought, ch. 16.
  2. Roncaglia, The Wealth of Ideas, ch. 16.
  3.  Lichtenstein, An Introduction to Post-Keynesian and Marxian, part IV.
  4. R. L. Meek, “Mr. Sraffa’s Rehabilitation of Classical Economics,” Scottish Journal of Political Economy 8 (1961), pp. 119 – 136.

B.        After Sraffa:  Surplus Models and Heterodox Economics

  1. Hunt, History of Economics Thought, ch. 18, 19.
  2. Lichtenstein, An Introduction to Post-Keynesian and Marxian, part VI.
  3. Harris, D. J.  1974.  “The Price Policy of Firms, the Level of Employment and Distribution of Income in the Short Run.”  Australian Economic Papers 13 (June):  144 – 151.