Adam Smith Lives!

Economic Man & Leadership Studies

I'm still at the week long opening seminar for ACE fellows.  We've now turned to the topic of "leadership", broadly defined so much of the afternoon was about what's a leader, how to lead and so on.  One of our speakers this afternoon put up a slide that had a bullet point saying "assumptions about human nature" and suddenly I started paying very close attention.  Though leadership studies people don't always recognize this -- the disciplines mentioned in today's talk on leadership were political science and business (mgt) -- political economists have been talking about similar issues for a very long time.  Adam Smith at the forefront.

The passage from Smith that I think speaks most powerfully to the study of leadership is this (some of you know this already -- even so, it's fun to read!):

"The difference of natural talents in different men is, in reality, much less than we are aware of; and the very different genius which appears to distinguish men of different professions, when grown up to maturity, is not upon many occasions so much the cause, as the effect of the division of labour.The difference between the most dissimilar characters, between a philosopher and a common street porter, for example, seems to arise not so much from nature, as from habit, custom, and education. When they came into the world, and for the first six or eight years of their existence, they were perhaps, very much alike, and neither their parents nor playfellows could perceive any remarkable difference. About that age, or soon after, they come to be employed in very different occupations. The difference of talents comes then to be taken notice of, and widens by degrees, till at last the vanity of the philosopher is willing to acknowledge scarce any resemblance."

There will be plenty of opportunities to return to this passage.  David Levy and I use it as part of the title of our forthcoming book, The Vanity of the Philosopher. For now, I want simply to point out that there's a great divide among us -- among the ACE Fellows I'm getting to know this week but also among the rest of us in the academy -- about the nature of what economists have come to call economic man, that relates to leadership studies.  In the lingo of leadership studies, the divide occurs over whether we're all capable of being a "leader" (given sufficient training and so on) or not.  The American Council on Education presupposes that leadership can be learned.  But many of the fellows, I sense, as well as many of us in the academy, think that education notwithstanding some of us "ought" to lead because we're better at it than others. 

FYI:  a graduate student at GMU, Kail Padgitt, is conducting some experimental research on this question that we'll be presenting at the International Leadership Association 2005 annual meeting.  Also, Terry Price at the Jepson School (UR) has some interesting work on ethical failures of leadership as they relate to the presumption that some of us "ought" to lead. 

    

Education -- The debate in visual terms

At the ceremony following my son's (championship) baseball season, his coach commented that my son was "coachable".  This puzzled me somewhat -- he never seems to listen to me -- but it gave me great hope:  he's apparently teachable.  His middle name is "Casey", to reflect our Irish roots.

In the nineteenth and twentieth centuries, political economists and other social commentators debated this:  if people are poor but teachable, education will enable them to improve their condition in life as long as the right incentives are in place.  If they were not, the problem was how to transform these people so that they might become self sustaining human beings?  The economists lined up on the side of education and incentives, while others favoured transformation.

One picture (from Punch) that illustrates the latter argument is "The English labourer's burden". Here, an ordinary-looking Englishman struggles to carry an Irishman.  The question is, might the Irishman become a self-sustaining human being if he were educated, or is he naturally unable to do so (in which case he's inherently "uncoachable".)  The physical features of the Irishman in the picture suggest the latter -- this is a man who is naturally inferior to the person who carries him. 

I object to this visual claim, and I hope I do so for more than the reason that my grandmother was a Casey.

Marshall on education

I'm not a Marshall specialist and I've recently come to disagree with him on the issue of race and hierarchy in economics (in an article with David Levy in the Journal of the History of Economic Thought).  Here's a good starting point on Marshall from the New School HET site.  But -- I'm (still) at the conference for the 2005-6 class of American Council on Education Fellows -- I can't resist posting another much-loved "education" passage.  In his Principles of Economics, Marshall wrote:

"Education must be made more thorough. The schoolmaster must learn that his main duty is not to impart knowledge, for a few shillings will buy more printed knowledge than a man's brain can hold. It is to educate character, faculties and activities; so that the children even of those parents who are not thoughtful themselves, may have a better chance of being trained up to become thoughtful parents of the next generation."

The full passage, along with the conclusion: "Towards this end, public money must flow freely" -- which he extends as well to "fresh air and space for wholesome play for the children in all working class quarters" -- are available at the Library of Economics and Liberty.  I'm not sure how far I'd go along with Marshall's conclusion but his take on our attempts to impart knowledge is humbling, and compelling!

"Cram"

For many of us, classes begin today.  I'm not teaching -- I'm doing a fellowship with the American Council on Education (ACE)-- and I miss it.  I spent much of the day reading about higher education in the US for the first ACE seminar.  But this passage from William Stanley Jevons' 1877 essay in Mind, "Cram," may be as good as anything I read today:

"It is not merely that which goes into the eyes and ears of a student which educates him; it is that which comes out.  A student may sit on the lecture-room benches and hear every word the teacher utters; but he may carry away as much useful effect as the drowsy auditor of a curate's sermon.  To instruct a youth in gymnastics, you do not merely explain orally that he is to climb up one pole, and come down another, and leap over a third.  You make him do these motions over and over again, and the education is in the exertion.  So intellectual education is measured, not by words heard, or read, but by thoughts excited." 

I have a hard copy of Jevons' Methods of Social Reform but I'm glad to see that it's online at the Online Library of Liberty.  (Is everything there?!) You can read the rest of Cram, as well as a bunch of other interesting pieces by Jevons, there. 

Why the past matters -- the pictures

Here's one of my favourite pictures from the Victorian magazine, Punch.  The best description I've heard of Punch for today's readers -- it comes from the student who introduced me at a Common Hour talk I gave at Dickinson College -- is that Punch is something like today's Onion. 

Punch's influence was huge.  And, we'll see as we move through some of the 19th century debates between political economists and anthropologists, Punch was well informed, filled with prose and lots of pictures.  The images were perhaps more effective than their prose.  This one is by their principal artist in the late 1860s, John Tenniel.

How the influence?  Punch's readers were given a steady diet of pictures like this one.  (I thank David Laidler for reminding me that the caption comes from Donizetti's L'Elisir d'Amour.)  It's a picture of the famous Manchester MP, John Bright, trying to sell medicine to Irish folks.  Dupes that they are, the Irish can't tell the difference between real and fake medicine.  They're not equipped to trade.  We'll come back to this, who can and can't trade, before long.  For now, I want to suggest that if you were to see pictures of ____ folks (fill in the blank) over and over again, as simple minded dupes with misshappen foreheads and jaws, you might come to believe these people can't trade or govern themselves.  You might need to plan for them.  The images conveyed that message more powerfully than the words (we'll see there were plenty of each). 

The past matters because beliefs today are to some extent the product of the past.  And if we understand the pictures of the past we've got a better chance of understanding beliefs today. 

Why does the past matter -- private / public goods

Does the Past Matter? Public and Private Knowledge

My last post made the case that history matters in terms of the interrelatedness of texts and ideas. Here, I want to revisit the difference between private and public knowledge.

When David Levy and I gave some lectures at Oberlin College on the history of the dismal science (see Peart-Levy Vanity 2005), an economist told us he felt "emancipated". How? Certainly the profession’s judgment is that HET isn’t of much relevance to faculty or graduate students in economics.

Consider two accounts of our past. In one, well known but wrong, economics became the dismal science because it denied the possibility of human improvement. Here, dismal science indicates that economists were committed to a fixed world of misery. They opposed schemes for improvement and were thoroughly hard hearted. An alternative account – one we suggest is accurate, though less known – has economics as the dismal science because of an unrealistic view of human nature that denied races are inherently different. Economists supposed that people are equally competent, opposed racial slavery, and favored markets instead.

Would an economist be willing to pay something to learn the second account of our history is accurate, and the standard account is wrong? If so, we have the possibility of a divergence between private and social considerations.

How might such valuable things in the past be consistent with the lack of remuneration in the history of economics? Mark Blaug (No History of Ideas, Please) suggests that this is evidence that economists are failing to optimize by neglecting the history of economics.

Perhaps there’s more to it. Arguments can be too advanced to be appreciated until they have been long forgotten. They might also be concealed. It may be in the interest of the representative economist to know that the "history" contained in the standard account is wrong. But there is nothing in the standard reward package in economics that provides the incentives for an economist to make the investment in scholarship required to seek out such persistent mistakes. (Believe me, I know this one from experience!)

Perhaps historians of economics need to assume some responsibility as those who know the past of economics. We need, perhaps, to convince our self interested colleagues who are economists that there is a benefit – to themselves well as to their students) - that results when they know their past. This of course presumes that people value finding out that they were the "good guys", and, perhaps, that there are other such stories out there! On of the most wrong headed such mistakes has Malthus as a forerunner to Social Darwinism (Malthus misunderstood). We’ll come back to that one before long.

Why does the past matter? the general equilibrium case

Everything is related

Many of us who teach or do research in the History of Economic Thought (HET) have long felt that the economics profession undervalues our specialization, and we have struggled to make the case in support of it. The argument, as I've heard it, is sometimes cast in terms of externalities, other things that come along as we study HET:  unlike more technical economics courses, ours is, we hold, a course in which students learn how to write. If universities value writing, we might use this argument to justify the HET course in the overall curriculum. So, one of the HES-sponsored sessions I approved for the 2005 Allied Social Science Association meeting was "A Roundtable Discussion About Using Writing Across the Curriculum in the History of Economics Course". It’s a good strategy, one that justifies the otherwise beleaguered HET course.

But this under-emphasizes a case that I have recently come to appreciate: all sorts of economists who know the past have a better understanding of the present. I’ve always said that to myself – it’s a way to get through the day when you teach the history of ideas in an unsympathetic world! But it’s only recently that I’ve come fully to appreciate the general equilibrium point: If ideas, like markets, are interrelated, then what we don’t read has implications for our understanding (or lack of) of what we do read. Sometimes, the gap in understanding will be small and unimportant. When it comes to understanding the opposition to economics, this is probably not a safe assumption. If we are ever to engage that opposition in serious discussion – to convince our reading public that, for instance, free trade is not such a bad thing – we need fully to appreciate the origin, influence, and longevity of old ideas and debates. So if we don’t know that at least some progressives favoured eugenic restrictions on immigration, we may misunderstand their policy recommendation that "charity begins at home". We may think this is a statement in favour of charity (for those at home) when in fact it may be a statement about who should not receive charity and why not. We may also think that economics has been attacked – today and in the past – by the left, by those who wish to see more (not less) equality. And not by those on the right, who wish to see less (not more) equality. We’d be wrong to omit the latter group, and future posts will give evidence as to why.

That everything is related – the present is misunderstood if there is a gap in knowledge of the past – is a telling argument for teaching and studying the past of economics within economics as well as without. I don’t mean, by this, to argue that the HET should be taught only by economists: competition provides a useful corrective on historians of economic thought within and without economics. This underscores the Summer Institute for the Preservation of the History of Economics that has been held for the past 6 years at George Mason University. (More on the SI will follow in this blog! It’s one of the resources linked on the right..)

So, among other things, this is a blog to help fill in the interrelatednes, to help us identify and, perhaps, solve the problems that result because our knowledge of the past is incomplete.  It will of course focus often on the particular sets of problems that, with David Levy, I've spent a lot of time on recently. The origins of the dismal science will feature prominently (Levy-Peart Secret History)So will our forthcoming book, the Vanity of the Philosopher. I plan to post something here a couple of times a week.

I like pictures. So I’ll try to post an image that has something to do with what I’m writing, each time I post. The first one below – I posted it before I moved back home from VA and things went a bit nuts -- is one of my favourites. The context will become more clear as we move through some of my texts. For now, think of it as a picture of exchange. Of equality. Of interrelatedness. Perhaps of sympathy? It’s by the late nineteen century engineer and sometimes political economist, Fleeming Jenkin.(wikipedia )