Skip to main content Accessibility help

We use cookies to distinguish you from other users and to provide you with a better experience on our websites. Close this message to accept cookies or find out how to manage your cookie settings.

Close cookie message
×
Hostname: page-component-cd9895bd7-q99xh Total loading time: 0 Render date: 2024-12-18T22:41:03.317Z Has data issue: false hasContentIssue false

3 - Malthus and the Classics (Not Walras and the Marginalists) as the Major Inspiring Source in the History of Economic Thought

The Principle of Effective Demand and Classical Economics

Published online by Cambridge University Press:  17 February 2022

By
Heinz D. Kurz
Edited by
Enrico Bellino  and
Sebastiano Nerozzi
Enrico Bellino
Affiliation:
Università Cattolica del Sacro Cuore, Milano
Sebastiano Nerozzi
Affiliation:
Università Cattolica del Sacro Cuore, Milano
Get access

Summary

Thomas Roberts Malthus is typically considered a ‘classical’ economist together with Adam Smith and David Ricardo. However, in important respects his view differed fundamentally from theirs, as Keynes emphasised in his biographical essay on Malthus. Most importantly, Malthus vehemently opposed Ricardo’s doctrine that it was impossible for effective aggregate demand to be deficient. Keynes, who also insisted on the possibility of effective demand failures, therefore considered Malthus to have been a precursor of his own view. The chapter discusses the following themes. What was the classical conception of ‘Say’s law’ and what were the reasons why Ricardo endorsed and Malthus rejected it? What were the main lines of reasoning in the ‘general glut’ controversy between Malthus and Ricardo? Was Keynes justified in considering Malthus’s doctrine to foreshadow his own doctrine, and if not, why not? What are the reasons why according to Pasinetti the classical (Ricardo-Sraffa) approach to the theory of relative prices and income distribution is compatible with Keynes’s principle of effective demand?

Keywords

Classical economicsDavid Ricardogeneral glut controversyJohn Maynard KeynesPiero Sraffaprinciple of effective demandsaving and investmentSay’s lawThomas Robert Malthus
Type
Chapter
Information
Pasinetti and the Classical Keynesians
Nine Methodological Issues
 , pp. 50 - 78
Publisher: Cambridge University Press
Print publication year: 2022

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Baumol, W. (1977) ‘Say’s (at Least) Eight Laws, or What Say and James Mill May Really Have Meant’, in Economica, New Series, 44(174), pp. 145–161.CrossRefGoogle Scholar
Clower, R. W. and Leijonhufvud, A. (1973) ‘Say’s Principle, What It Means and Doesn’t Mean’, in Intermountain Economics Review, 4(2), pp. 1–16. Reprinted in Leijonhufvud, A. (1981) Information and Coordination, New York and Oxford, Oxford University Press.Google Scholar
Garegnani, P. (1978) ‘Notes on Consumption, Investment and Effective Demand: I’, in Cambridge Journal of Economics, 2, pp. 335–353.Google Scholar
Garegnani, P. (1979). ‘Notes on Consumption, Investment and Effective Demand: II’, in Cambridge Journal of Economics, 3, pp. 63–82.Google Scholar
Gehrke, C. and Kurz, H. D. (2001) ‘Say and Ricardo on Value and Distribution’, in The European Journal of the History of Economic Thought, 8(4), pp. 449–486.Google Scholar
Kalmbach, P. and Kurz, H. D. (2009) ‘Malthus: Vorgänger von Keynes?’, in Hagemann, H., Horn, G. and Krupp, H. J. (eds.) Aus gesamtwirtschaftlicher Sicht. Festschrift für Jürgen Kromphardt, Marburg, Metropolis, pp. 163–182.Google Scholar
Keynes, J. M. (1973 et seq.). The Collected Writings of John Maynard Keynes, Moggridge, D. (ed.), London and Basingstoke, Macmillan (cited as CWK, volume number, page number).Google Scholar
Kurz, H. D. (1985) ‘Effective Demand in a “Classical” Model of Value and Distribution: The Multiplier in a Sraffian Framework’, in The Manchester School, 53(2), pp. 121–137.Google Scholar
Kurz, H. D. (1986) ‘“Normal” Positions and Capital Utilization’, in Political Economy. Studies in the Surplus Approach, 2, pp. 37–54.Google Scholar
Kurz, H. D. (1998) ‘Limiting and Regulating Principles’, in Kurz, H. D. and Salvadori, N. (eds.) The Elgar Companion to Classical Economics, vol. 2, Cheltenham and Northampton, Edward Elgar, pp. 45–50.CrossRefGoogle Scholar
Kurz, H. D. (2000) ‘The Hayek-Keynes-Sraffa Controversy Reconsidered’, in Kurz, H. D. (ed.) Critical Essays on Piero Sraffa’s Legacy in Economics, Cambridge, Cambridge University Press, pp. 257–301.Google Scholar
Kurz, H. D. (2010) ‘Technical Progress, Capital Accumulation and Income Distribution in Classical Economics: Adam Smith, David Ricardo and Karl Marx’, in The European Journal of the History of Economic Thought, 17 (5), pp. 1183–1222.Google Scholar
Kurz, H. D. (2015) ‘Capital Theory, Crises, and Business Cycles: The Triangular Debate between Hayek, Keynes and Sraffa’, in Journal of Reviews on Global Economics, 4, pp. 186–191.CrossRefGoogle Scholar
Kurz, H. D. (2020) ‘The Theory of Value and Distribution and the Problem of Capital’, in European Journal of Economics and Economic Policies: Intervention, 17(2), pp. 241–264.Google Scholar
Kurz, H. D. and Salvadori, N. (1995) Theory of Production: A Long-Period Analysis, Cambridge, Cambridge University Press.Google Scholar
Kurz, H. D. and Salvadori, N. (1998) ‘Reverse Capital Deepening and the Numeraire: A Note’, in Review of Political Economy, 10(4), pp. 415–426.CrossRefGoogle Scholar
Kurz, H. D. and Salvadori, N. (2006) ‘Endogenous Growth in a Stylised “Classical” Model’, in Stathakis, G. and Vaggi, G. (eds.) Economic Development and Social Change, London and New York, Routledge, pp. 106–124.Google Scholar
Malthus, T. R. (1820 [1989]) Principles of Political Economy, Pullen, J. (ed.),Variorum edition, 2 vols., Cambridge, Cambridge University Press.Google Scholar
Marshall, A. (1890 [1920]) Principles of Economics, 8th ed., London, Macmillan.Google Scholar
Pasinetti, L. L. (1974) Growth and Income Distribution: Essays in Economic Theory, Cambridge, Cambridge University Press.Google Scholar
Pasinetti, L. L. (1977a) Sviluppo economico e distribuzione del reddito, Bologna, Il Mulino.Google Scholar
Pasinetti, L. L. (1977b) Lectures on the Theory of Production, London, Macmillan.Google Scholar
Pasinetti, L. L. (ed.) (1980) Essays on the Theory of Joint Production, London and Basingstoke, Macmillan.CrossRefGoogle Scholar
Pasinetti, L. L. (2007) Keynes and Cambridge Keynesians, Cambridge, Cambridge University Press.Google Scholar
Pigou, A. C. (1933) The Theory of Unemployment, London, Macmillan.Google Scholar
Ricardo, D. (1951–1973) The Works and Correspondence of David Ricardo, Sraffa, P. with the collaboration of Dobb, M. H. (eds.), 11 vols., Cambridge, Cambridge University Press.Google Scholar
Schefold, B. (1989) Mr Sraffa on Joint Production and Other Essays, London, Unwin Hyman.Google Scholar
Smith, A. (1776 [1976]) An Inquiry into the Nature and Causes of the Wealth of Nations, The Glasgow Edition of the Works and Correspondence of Adam Smith, Campbell, R. H. and Skinner, A. S. (eds.), Oxford, Clarendon Press.Google Scholar
Sraffa, P. (1925 [1998]) ‘On the Relationship between Cost and Quantity Produced’, in Pasinetti, L. L. (ed.) Italian Economic Papers, vol. iii, Bologna, Il Mulino; Oxford, Oxford University Press, pp. 323–363, English translation from the Italian original by Eatwell J. and Roncaglia A.Google Scholar
Sraffa, P. (1926) ‘The Laws of Returns under Competitive Conditions’, in Economic Journal, 36(144), pp. 535–550.CrossRefGoogle Scholar
Sraffa, P. (1932) ‘Dr. Hayek on Money and Capital’, in Economic Journal, 42, pp. 42–53.CrossRefGoogle Scholar
Sraffa, P. (1960) Production of Commodities by Means of Commodities, Cambridge, Cambridge University Press.Google Scholar
Stigler, G. J. (1953) ‘Sraffa’s Ricardo’, in American Economic Review, 43(3), pp. 586–599.Google Scholar

Save book to Kindle

To save this book to your Kindle, first ensure [email protected] is added to your Approved Personal Document E-mail List under your Personal Document Settings on the Manage Your Content and Devices page of your Amazon account. Then enter the ‘name’ part of your Kindle email address below. Find out more about saving to your Kindle.

Note you can select to save to either the @free.kindle.com or @kindle.com variations. ‘@free.kindle.com’ emails are free but can only be saved to your device when it is connected to wi-fi. ‘@kindle.com’ emails can be delivered even when you are not connected to wi-fi, but note that service fees apply.

Find out more about the Kindle Personal Document Service.

Available formats
×

Save book to Dropbox

To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Dropbox.

Available formats
×

Save book to Google Drive

To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Google Drive.

Available formats
×