The Natural Origins of Economics (review)

In tracing the secularization and denaturalization of economics during the Victorian period, Margaret Schabas's The Natural Origins of Economics covers a wide range of topics. This is a slim volume, and while it centers on an interesting subject, the author's arguments are constrained by the brevity of the work. Schabas raises fascinating points, but then closes them down within a paragraph (or even a sentence) when the reader wishes she would expand on them further. For example, the discussion of Carl Linnaeus's potential impact on Adam Smith and much of classical economics is fresh and could be quite interesting. Schabas, however, does not extend that discussion beyond a brief mention that Smith owned Linnaeus's books. Similarly, Schabas notes the importance of the Lyell/Darwin connection in secularizing economics, but does not extend the discussion to include the Age of the Earth debates in the 1860s. An examination of how these scientific debates may have contributed to young intellectuals' loss of religious faith later in the Victorian period—and thus could have affected the development of economics as a discipline—would have profitably expanded this section of the book.

In some cases, a more careful rendering of the material might have prompted the author to reconsider some of her bolder statements. She contends, for instance, that the formation of the Statistical Society in Britain validated David Ricardo's work and helped establish the importance of political economy for the average person. Yet both Richard Jones and Charles Babbage (two founding members) viewed the Society as a tool for creating an alternative to Ricardo's deductive approach. Jones and Babbage were concerned that British political economy was too abstract and did not focus on the problems of the day, particularly as they related to the plight of the poor.

Schabas's use of modern terms to discuss eighteenth- and nineteenth-century ideas leads to some difficulties in her argument. For instance, the concepts of efficiency and waste—concepts that, according to Norton Wise, emerged with the development of the steam engine—are used to describe economic thought well before the rise of the industrial economy. Similarly, Schabas introduces the term punctuated evolution; however, in the nineteenth century, discontinuities in the fossil record were referred to as "catastrophies," placing them in stark contrast with the uniformitarianism of Charles Lyell. Such distinctions formed the basis for the great debates in geology that captivated the general public and played a large role in the secularization of science during this period.

The book's treatment of John Stuart Mill and the early neoclassical economists also raises some questions. Mill's desire to conform to the notion of uniformity in nature propelled him to separate the "Laws" of production and distribution into separate books in his Principles of Political Economy (1848). Ostensibly, such a distinction allowed economics to become a mental science in which social reform and improvements in human character would play a vital role. But because Schabas argues that this role was limited to matters pertaining to distribution, it is difficult to understand how human decision-making would lead to a better world as defined in terms of greater material abundance. This concern was shared by Alfred Marshall, whose own Principles of Economics (1890) abandons Mill's two-sphere approach. Yet I wish Schabas had offered more insight into how this transformation in the structure of economic theory took place.

The difficulty may be the result of the author's steadfast desire to highlight the emergence of psychological elements that transformed economics into a field of study in which individual decisions and social institutions play a prominent role. As a result, Schabas ignores the significant impact of evolutionary biology—and specifically Darwin's theory of natural selection—on later figures such as Marshall.

The central problem with this book is its lack of a coherent and consistent explanation for how the secularization and denaturalization of economics occurred. The Natural Origins of Economics is...