A.C. Pigou and the 'Marshallian' Thought Style: A Study in the Philosophy and Mathematics Underlying Cambridge Economics (Palgrave Studies in the History of Economic Thought)

This book provides a study of the forces underlying the development of economic thought at Cambridge University during the late nineteenth century and the first half of the twentieth century. The primary lens it uses to do so is an examination of how Arthur Cecil Pigou's thinking, heavily influenced by his predecessor, Alfred Marshall, evolved. Aspects of Pigou's context, biography and philosophical grounding are reconstructed and then situated within the framework of Ludwik Fleck's philosophy of scientific knowledge, most notably by drawing on the notions of 'thought styles' and 'thought collectives'. In this way, Knight provides a novel contribution to the history of Pigou's economic thought. Karen Lovejoy Knight is Economics Tutor and Sessional Lecturer at the University of Notre Dame, Western Australia and Edith Cowan University, Western Australia. She is also a business consultant and independent researcher. Her research interests lie in the history of economic thought, economic history, political economy, the sociology of scientific knowledge and philosophy Preface 7 Acknowledgements 8 Contents 10 List of Figures 12 List of Photographs 13 List of Tables 14 1: A.C. Pigou and the Cambridge Tradition 15 1.1 Introduction 15 1.2 A Marshallian ‘Thought’ Style 17 1.3 A Pigouvian Perspective 20 1.4 The Structure of the Book 24 References 28 2: The Elusive A.C. Pigou 33 2.1 Introduction 33 2.2 Family, Heritage, and School 34 2.3 Early Years at Cambridge 39 2.4 The ‘Prof’ 46 2.4.1 Pigou’s Major Scholarly Contributions: A General Overview 48 2.4.2 Work and Leadership at Cambridge 58 2.4.3 Public Service 64 2.5 The Private Life of a Very Private Man 65 2.5.1 Women and Men 66 2.5.2 Friendship and Mountaineering 67 2.5.3 The Ordeals of War 69 2.6 A Brief Final Reflection 71 References 82 Archival Material 82 Published Material 83 3: The ‘Prof’ and Marshallian Economics 92 3.1 Perspectives of Pigou as a ‘Marshallian’ Economist 92 3.2 Perceptions of Pigou’s Continuity with Marshallian Thought 94 3.2.1 The Rationale for Economic Science 95 3.2.2 Ethics and the Domain of Economic Science 96 3.2.3 Judicious Use of Realism and Approximation in Modelling Dynamic Systems 99 3.2.4 Pigou, the Loyal Marshallian 101 3.3 Perceptions of Pigou’s Deviation from Marshallian Thought 103 3.3.1 The Concept of Consumer Surplus 104 3.3.2 Monetary Theory 105 3.3.3 Pigou’s Equilibrium Firm Versus Marshall’s Modally Representative Firm in Industry 106 3.3.4 Marshall’s Evolutionary Economics 109 3.3.5 Pigou’s Increasing Use of Mathematics and Formalism 111 3.4 Reconciling Perspectives of Pigou as a Marshallian Economist 113 3.5 Concluding Remarks 115 References 118 Archival Material 118 Published Material 118 4: The ‘Marshallian’ Thought Collective and Thought Style 127 4.1 Introduction 127 4.2 The Sociology of Science and Ludwik Fleck 128 4.2.1 Fleck’s Evolutionary Account of Knowledge Production 130 4.2.2 Thought Collectives and Thought Styles 132 4.3 The Marshallian Thought Style and Thought Collective 136 4.3.1 The ‘Marshallian’ Thought Collective 136 Formation: Problems of Common Interest 137 Sociological Structure and Relations 138 Social Reinforcement 140 Temporality: Two Phases of the Marshallian Thought Collective 141 Spatiality 144 4.3.2 The ‘Marshallian’ Thought Style 145 4.3.3 Pigou and Marshall: Corroboration and Alteration of Thought Style 151 4.4 Concluding Remarks 153 References 156 5: Balancing the Material and the Ideal 162 5.1 Introduction 162 5.2 Utilitarianism and British Idealism 164 5.2.1 The British Utilitarian Tradition 164 5.2.2 Neo-Hegelianism and the British Idealist Movement 167 5.2.3 Hermann Lotze as a Modulating Influence on British Idealism 168 5.3 Late British Idealism and Transition 171 5.3.1 The Emergence of Personal Idealism at Cambridge 171 5.3.2 British Idealism and Cambridge Critiques 172 5.3.3 The Reception of Nietzsche’s Work in Britain 174 5.3.4 Situating Marshall and Pigou in the Idealist Period 176 5.4 Pigou as a Moral Sciences Student and His Philosophical Essays 177 5.4.1 Pigou as a History and Moral Sciences Student 177 5.4.2 Pigou’s Philosophical Essays 179 5.5 Concluding Remarks 193 References 206 Archival Material 206 Published Material 207 6: Mathematics and Formalism in Economic Theory 216 6.1 Introduction 216 6.2 Marshall, Pigou, and Analogies: Modelling Economic Complexity 217 6.3 Pigou, Mathematics, and Method 221 6.3.1 Background: British Traditions in Mathematics 221 6.3.2 The Marshallian Thought Style and Mathematics 224 6.3.3 Reconstructing Aspects of Pigou’s Mathematical Training 226 6.4 Corroboration and Alteration of the Marshallian Thought Style 231 6.4.1 The Marshallian Thought Style and Corroboration 235 6.4.2 The Marshallian Thought Style and Its Evolution 237 6.5 A Case Study: Correspondence on the Use of Mathematical Formalism in The Theory of Unemployment 239 6.5.1 Pigou’s Mathematical Errors and the Corrigenda 240 6.5.2 The Theory of Unemployment: An Overview of the Basic Model 241 6.5.3 Unsolicited Correspondence 248 6.5.4 Solicited Correspondence 249 6.5.5 Letters to Pigou as a Case Study: Some Final Comments 254 6.6 Concluding Remarks 256 References 260 Unpublished Material 260 Published Material 261 7: Conclusion 267 References 272 Appendix A: Comparison of Sidgwick and Lotze 273 Appendix B: Moral Sciences Part II Syllabus and Recommend Texts 276 Appendix C: Contents of Pigou’s Remaining Private Library 288 Appendix D: Letters on The Theory of Unemployment, Kahn 300 Appendix E: Letters on The Theory of Unemployment, Bowley 302 Appendix F: Letters on The Theory of Unemployment, Allen 308 Appendix G: Letters on The Theory of Unemployment, Robertson 314 Appendix H: Comparison, The Theory of Unemployment’s Corrigenda 315 Index 318 Front Matter ....Pages i-xvii A.C. Pigou and the Cambridge Tradition (Karen Lovejoy Knight)....Pages 1-18 The Elusive A.C. Pigou (Karen Lovejoy Knight)....Pages 19-77 The ‘Prof’ and Marshallian Economics (Karen Lovejoy Knight)....Pages 79-113 The ‘Marshallian’ Thought Collective and Thought Style (Karen Lovejoy Knight)....Pages 115-149 Balancing the Material and the Ideal (Karen Lovejoy Knight)....Pages 151-204 Mathematics and Formalism in Economic Theory (Karen Lovejoy Knight)....Pages 205-255 Conclusion (Karen Lovejoy Knight)....Pages 257-262 Back Matter ....Pages 263-316