HISTORY OF ECONOMIC THOUGHT
Economics 315
Fall 2001
 
 

A study of the history of ideas is a necessary preliminary to the emancipation of the mind.

J.M. Keynes
 
 

The purpose of this course is to study the most important economic theories of the past in order to gain a better understanding, not only of these earlier economic theories, but also of the nature of economic theory in general and of the strengths and weaknesses of modern micro and macro economics.  We will study the “great masters” of economics:  Smith, Ricardo, Marx, Marshall, Keynes, and Keynes.  We will examine these theories from both neo?classical and Marxian perspectives.  We will continually compare and contrast these two different perspectives.  As the course proceeds, each student should think about which of these perspectives seems to be the most plausible and enlightening in understanding the history of economics.

Class sessions will be largely discussions.  Study questions will be handed out for each set of  readings.  Students are expected to have read the assignment prior to class and to be prepared to discuss the study questions.  It should be noted that the reading load for this course is quite heavy.  This is unavoidable because we have to read both the original works of the masters and secondary sources from different perspectives.  You should schedule sufficient time for careful study of the assigned readings.  It is important to read all the assignments and to take good notes, even if everything is not initially understood.  Better understanding should come with later discussions and further reflection.  Hopefully, this intellectual journey through time will be exciting enough to make the hard work worthwhile.
 

Books available in the Odyssey Bookstore:

  Blaug, Mark,  Economic Theory in Retrospect
  Keynes, J.M.,  The General Theory of Employment, Interest, and Money
  Marx, Karl,  Capital, Volume 1
  Ricardo, David,  Principles of Political Economy
  Smith, Adam,  The Wealth of Nations

 LIST OF COURSE READINGS
 
 

Blaug, Mark.  Economic Theory in Retrospect.

Heilbronner, Robert.  “Modern Economics as a Chapter in the History of Economic Thought,”
    History of Political Economy, 1979, pp. 192?98.

Keynes, John.  The General Theory of Employment, Interest, and Money

Marx, Karl.  Capital, Volume 1.

          (2).  Capital, Volume 3.

Moseley, Fred (1).  “Marx’s Theory of the Falling Rate of Profit”
     in Glasner (ed.), Encyclopedia of Business Cycles.

          (2).  “Marx’s Logical Method and the Transformation Problem,”
     in Moseley (ed.), Marx’s Method in Capital: A Reexmination.

          (3).  “Marx’s Economic Theory: True or False?  A Marxian Response to Blaug’s Appraisal,”
     in Moseley (ed.), Heterodox Economic Theories: True or False.

Ricardo, David. Principles of Political Economy.

Rubin, I.I.  A History of Economic Thought.

Smith, Adam.  The Wealth of Nations.
 
 

 
 ASSIGNED READINGS
 
 

1.  ALTERNATIVE APPROACHES to the history of economic thought

     Blaug, Introduction
 
 

2.  SMITH

     a.  Growth and development
Rubin, Chapter 18
     Smith, Book 1, Introduction and Chapters 1?3
           Book 2, Chapter 3
Blaug, Chapter 2 (pp. 33?37 and 53-54)

     b.  Value and distribution
Smith, Book 1, Ch. 4 (pp. 131-32), Chs. 6-7, Ch. 8 (167-72 and 189-90),
  Ch. 9 (pp. 190-91), and Ch. 11 (pp. 247-49 and 350-59)
Blaug, Chapter 2 (pp. 37?52)

     c.  Welfare
Smith, Book 4, Chapter 2 (pp. 452?59)
Blaug, Chapter 2 (pp. 56?63)
 
 

3.  RICARDO

     a.  Value
Rubin, Chapter 25
      Ricardo, Preface and Chapter 1
     Blaug, Chapter 4 (pp. 90?96 and 106?12)
 
     b.  Distribution
Ricardo, Chapter 2, 5, and 6
      Blaug, Chapter 4 (pp. 85?89, 96?103, and 112?18)

     c.  Comparative Advantage
Ricardo, Chapter 7 (pp. 89-95)
     Blaug, Chapter 4 (pp. 118-23 and 132-34)
 

FIRST PAPER:   Assigned:  October 2
  Due:  October 16

 
4.  MARX

     a.  Value
      Marx (1), Chapter 1 (Sections 1 and 2)
      Blaug, Chapter 7 (pp. 254-57)

     b.  Surplus?value
Marx (1), Chapters 4, 6, 7 (Sec. 2), 9 (Secs. 1 and 3), and 10 (Sec. 1) and 11
     Blaug, Chapter 7 (pp. 215-18 and 257-60)

     c.  Technological change
Marx (1), Chapters 12, 15 (Sec. 6), 24 (Sec.) 1, and 25 (Secs.1?4 )
     Blaug, Chapter 7 (pp. 247-49 and 260-62)

     d.  Falling rate of profit
Marx (2), Chapter 13 (pp. 211?16)
Moseley (1)
     Blaug, Chapter 7 (pp. 235-47 and 268-71)

     e.  Equal rates of profit (the “transformation problem”)
Marx (2), Chapter 9 (pp. 154?60)
Moseley (2)
     Blaug, Chapter 7 (pp. 218-31, 265-68, and 274-75)

f.  Evaluation
Moseley (3)
Blaug,  review points of evaluation
 
 

SECOND PAPER:  Assigned:  October 23
     Due:   November 6
 
 

5.  NEO?CLASSICAL MICROECONOMICS

     a.  Early development
      Blaug, Chapters 8 (pp. 277-301)

     b.  Value
Blaug, Chapter 9 (pp. 311-16, 322-39) and Chapter 10 (pp. 354-63 and 404-05)
Intermediate Microeconomics textbook

     c.  Distribution
Blaug, Chapter 11 (pp. 406-11, 417-25, 447-54, and 466-68)
Intermediate Microeconomics textbook
 

5.  NEO?CLASSICAL MICROECONOMICS - continued

     d.  Welfare economics
Blaug, Chapter 15 (pp. 570-80)
Intermediate Microeconomics textbook
 
 

THIRD PAPER: Assigned:  November 13
                Due:  November 27
 
 
 

6.  KEYNES AND MODERN MACROECONOMICS

     a.  Critique of the “classical” theory of the labor market
     Keynes, Preface and Chapters 1?2 and Chapter 19 (pp. 257-60)
Blaug, Chapter 16 (pp. 651-53)

b.  Theory of employment
Keynes, Chapters 3?5, 18 (pp. 245?49) and Chapter 19 (pp. 260-71)
     Blaug, Chapter 16 (pp. 653-61)

     c.  Modern macroeconomics
      Blaug, Chapter 16 (pp. 641-51 and 667-87)
Intermediate Macroeconomics textbook
 
 

FOURTH PAPER: Assigned:   November 27
                   Due:   December 11
 
 
 
 

7.  CONCLUSION: “Has Economic Theory Progressed?”

     Blaug, Introduction and Chapter 17
     Heilbronner
 
 

FINAL PAPER:   Assigned:  December 11
     Due:  December 20