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History of Political Economy 33.1 (2001) 182-184

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Book Review

The Pillars of Economic Understanding:
Ideas and Traditions

The Pillars of Economic Understanding: Ideas and Traditions. By Mark Perlman and Charles R. McCann Jr. Ann Arbor: University of Michigan Press, 1998. xx; 639 pp. $79.50.

Mark Perlman and Charles McCann (hereafter PM) begin their preface by claiming that “we are up to something different”; that is, different from “another excursion into the literature on the history of economic theory” (xiv). This claim is certainly valid. But just what, in their massive volume, PM are “up to,” or aiming to achieve, is far from easy to describe, let alone appraise. In chapter 1 we are introduced to two somewhat problematic concepts that appear intermittently throughout the volume. At times it is rather difficult to discern just what or how much explanation or elucidation these ideas provide. The first concept, or idea, is that of “patristic legacies,” or “traditions,” which were originally presented in the ethical and political philosophies of the ancient Greeks, the Judeo-Christians, and the medieval fathers. Chapter 2 introduces the “British patristic legacy” (although subsequent chapters do not seem to recognize any German, Austrian, French, or American “patristic legacies”—merely “traditions”). In the construction of the British legacy, the ethical and political philosophy of Thomas Hobbes is assigned a leading role, closely followed by those of John Locke and later George Berkeley, Bernard Mandeville, David Hume, and Adam Smith. The important economic writings, however, of Locke, Berkeley, and Hume are scarcely mentioned; and when we come to Smith, it is insisted that economists have been “mistaken” in believing that “Smith’s great book was The Wealth of Nations,” since “The Theory of Moral Sentiments is the more profound work” (70).

Also in chapter 1 we are introduced to PM’s second leading concept, that of “magisterial interpretations of economics,” of which they single out three: those of Karl Pribram, Wesley Mitchell, and Joseph Schumpeter, who all put together (or had posthumously completed) comprehensive histories of the subject from the ancient Greeks to some point in the twentieth century.

After the two opening chapters comes a comparatively uncontroversial treatment of mercantilism, followed by two chapters on various aspects of measurement, quantification, and statistical analysis. The physiocrats, and also Anne-Robert-Jacques Turgot, are included in chapter 4 on measurement, and in chapter 5 we are rushed on through the centuries, via William Newmarch, to Henry L. Moore, Gottfried Haberler on business cycles, and the founding of the Econometric Society in 1930. Next come three substantial chapters on political economy in Britain from Francis Hutcheson—who, incidentally, is confused in the index with T. W. Hutchison—to “Joan Robinson and Cambridge socialism.”

These later chapters (6–11 inclusive) dealing with separate national traditions illustrate the problems of overstretching a nationalist framework. The important cases of Schumpeter and Vilfredo Pareto might be cited. Schumpeter has been included not [End Page 182] simply as an American, but as a follower of a leading American tradition, that of old-style institutionalism, and is presented as “the one on whom the Veblen mantle fell most squarely” (560): a curious description of the great champion of the supremacy among economists of Léon Walras, who also, in his own “magisterial” history, made only an almost contemptuously brief mention of Veblen.

The more serious case, however, is that of Pareto, included as the concluding representative of the “triumph of Cartesian rationalism, the French tradition” (chapter 10). The difficulty is by no means merely that Pareto was Italian, not French. The confusion is that Pareto, in spite of his leading contributions to mathematical economic analysis, was never an adherent of Cartesian rationalism, but a severe critic thereof. As Roberto Marchionatti and Enrico Gambino in an invaluable article have recently demonstrated, Pareto was almost as cautious and critical as Alfred Marshall regarding the use of mathematics in economics, and, indeed, he once described himself as methodologically nearer to Adam Smith than to Walras. It is quite unjustifiable, therefore, to describe Pareto’s...


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