4 thoughts on “The Worldly Philosophers – the better half”

1. Let me briefly make the case as to why I think a suitable addition to this excellent list would be Sophie de Grouchy (1764-1822). She’s not widely known as an economist, but that has quite a bit to do with the rather narrow way in which the subject is understood today, and her contemporaries certainly would have thought of her as a kind of political economist. And what she worked on is a topic that is very much of interest to the more interesting and imaginative economists today.

   If people know about De Grouchy, it’s probably for one or more of four reasons: (i) she was the wife, and then widow, of the Marquis de Condorcet, one of the most important intellectuals of the Revolutionary period, who died in prison after being arrested during the Revolutionary Terror. (ii) She was (along with Condorcet) part of the Cercle social, from which many of the Revolution’s most interesting and radical legislative proposals derived, and which was also the centre of its feminist politics. (iii) She translated Adam Smith’s “Theory of Moral Sentiments”, which was the standard French translation of that book for 200 years. (iv) She appended to her translation a set of “Letters on Sympathy”, which discuss this key theme in Smith’s moral philosophy.

   Hmm. Doesn’t sound like much of an economist, perhaps. Let’s look a little closer. Many years later the Germans got interested in Das Adam Smtih Problem, which they took to be the difficulty of reconciling The Theory of Moral Sentiments (which seemed to rest on an account of sympathy) with The Wealth of Nations (which seemed to rest on an account of self-interest). How can we reconcile these positions? Most scholars these days don’t think Das Adam Smith Problem is really a problem — though it’s an itch they often return to scratch from time to time, which suggests that they aren’t always satisfied with the various explanations that are offered for why it isn’t supposed to be a problem. De Grouchy wasn’t, of course, a later nineteenth-century German professor. But she was thinking carefully about the relationship between Smith’s two big books.

   In particular, she was interested in whether Smith’s political economy could guide the life of a large, egalitarian republic–as France was trying to become in the early 1790s. Some recent Smith commentators–such as Iain McLean at Oxford–have argued that there’s a powerful egalitarian streak in Smith. They aren’t wrong. But that recognition has to be counterbalanced with his interest in the “system of ranks”, which he thought was made possible by the powerful imaginative sympathy we tend to have with the rich. Right at the end of his life, Smith worried that the disposition to admire the rich was what generated what he called “the corruption of the moral sentiments”. But most of the time, he thought that this kind of sympathy was a powerful social glue, which helped to keep commercial society from fragmenting, in the face of the various inequalities that it systematically generated.

   So if you want a more egalitarian society — the kind perhaps captured by the more recent label, a “property-owning democracy”, which is a pretty good label for the kind of society Condorcet and De Grouchy wanted to help to found in France — and if you wanted to present that society as compatible with Smith’s teachings about the freedom of commerce, and the like, it wasn’t a bad idea to rework his account of sympathy, to try to show that imaginative sympathy with the rich wasn’t as central to an account of a well-functioning commercial society as he himself seems to have thought.

   And this is what Sophie de Grouchy tries to do in the Letters on Sympathy. She explores the physiological basis of sympathy, and offers a different account to Smith’s, one grounded in the work of French writers like Condillac and Helvétius. This kind of argument makes me sleepy–I’m not very good with this kind of eighteenth-century natural science–so I won’t try to say more about the details here. But the thrust of the argument is to displace attention away from Smith’s account of the (potentially unbounded) imagination, and to think about the way sympathy comes to operate, first in the context of dependency (e.g., of a child on a parent), later across the relations of mutual co-dependence that structure a society characterised by the division of labour. With appropriate social institutions, especially concerning education, De Grouchy thought that the human capacity for sympathy could be nurtured in a broadly egalitarian manner, suitable for a modern republic, without it going off in the more Smithian, more inequality-friendly, kind of direction.

   We live in a post-socialist age. If democratic politics require a certain kind of citizen equality, but markets generate a certain kind of substantial inequality, how can we think our way through the various tensions that we find in the relationship between democratic states and capitalist markets. These days, we might think of this as Thomas Piketty’s question, and the stir that his book has made has reminded us that questions like this ought to stand close to the heart of the discipline of economics. And over two hundred years ago, Sophie de Grouchy was one of the people who was thinking and writing about this question in interesting and imaginative ways. Hers was an exceptionally interesting mind, and she seems to me very much to belong in a project to recover women’s voices in the history of economics.

   Not so brief in the end, perhaps. For which, my apologies.

2. As per my tweets, a list like this ought in my view to include Alice Amsden, who died a couple of years. Not so well known because something of a maverick, she was an outstanding scholar: an American heterodox development economist specialising in the history and policies of late industrialization, above all in South Korea but also elsewhere. For Alice, abstract theory was less important than looking carefully at and analysing empirical reality. She could ‘do’ the quants (regression analysis etc.) but did not use this as the core analytical method in what was really a programme of comparative economic history. Her books – including The Rise of the Rest and, before that, Asia’s Next Giant – have had a profound and widespread influence – both on many development economist academics and students around the world and on policy makers in Asia, in Latin America (especially Brazil), and in Africa. I remember her addressing a South African cabinet minister and others, saying “You know who would be a great teacher for you?” They were thinking, does she mean Stiglitz perhaps, or some other luminary of the field? “Brazil”, she said. For Alice, late industrialization and the policies it required were a matter of having the right role models (frankly, not the USA and UK) and the capacities to learn from them and implement adaptations of that learning. Industrialization itself is largely a matter of learning – learning from role models, putting in place the policies that allow for a period of ‘learning by doing’ protected from the full force of the hostility of global competition, and perhaps, to paraphrase Albert Hirschman, learning by failing (or – pace Samuel Beckett – failing better).

   But this learning, these policies, were not just about applying a standard toolkit of tariffs and subsidies. What Alice learned from and highlighted in the East Asian NICs experiences, what distinguished their industrial policies from those in many Latin American and African countries (and elsewhere), was the importance of ‘reciprocal control mechanisms’. In other words, states not only supported and protected private sector firms (e.g. the Korean chaebols) but disciplined them: removing privileges where they had not been used effectively to meet stringent targets for output growth, rate of growth of exports, etc.

   Alice wrote a widely known paper challenging one of the fundamental tenets of mainstream economics, that development is about ‘getting prices right’. For Alice, on the contrary, it has historically been created by ‘getting prices wrong’. Later in her life she wrote a chapter, unpublished at her death, arguing that many successful late developers also ‘got property prices wrong’, through nationalisations and abrupt shifts in ownership at the moment of independence, etc.

   Alice also lambasted the politically correct pronouncements of the era of poverty reduction and of the appealing but complex ideas of human capital theory (as given a starring role in many endogenous growth models). For one thing, the data show remarkably little dramatic reduction in the proportion of populations living below the $1.25 a day ‘poverty line’ – except, of course, in parts of East Asia and especially in China where the policies adopted in the past 20-30 years have been far removed from those urged on most developing countries. For Amsden, what mattered was not all the panoply of reforms encouraged in the poverty reduction era but the much neglected matter of creating meaningful jobs. Likewise, human capital theory goes too far when it turns into a form of educational Say’s Law, the idea that simply educating people more will generate demand for these educated people. By contrast, in many parts of the world we see educated people not securing meaningful, properly remunerated jobs. And even in South Korea and other Asian developing success stories, there was massive educated brain drain (actually useful in generating foreign exchange), only abating through the use of carefully designed ‘reverse brain drain’ policies and through the policy-driven industrialisation that created the jobs to soak up an increasingly educated workforce.

   So for her iconoclasm, her empirical observation, her analytical courage and indeed her hilarious wit, and for her very wide influence, she should be on any list like this.

3. Another example why this blog is wonderful because of Diane’s posts as much as for the comments, fortunately only a handful of them so that we can read them all. I hope it remains one the best kept secrets.

4. What about Ester Boserup? (She even wrote on women’s role in economic development).

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