Economic essays

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Identifikator:: 1753623200

URN:: urn:nbn:de:zbw-retromon-136107

Document type:: Monograph

Title:: Economic essays

Place of publication:: New York

Publisher:: Macmillan

Year of publication:: 1927

Scope:: viii, 368 S.; Ill., graph. Darst.

Digitisation:: 2021

Collection:: Economics Books

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Document type:: Monograph

Structure type:: Chapter

Title:: Static economics and business forecasting / Benjamin M. Anderson, Jr.

Collection:: Economics Books

12 ECONOMIC ESSAYS IN HONOR OF JOHN BATES CLARK REA of particular kinds of raw materials, and excessive industrial equipment in some lines, with inadequate equipment in others. A crisis comes and corrects these abnormalities, restoring equilibrium—roughly and approximately. Throughout his analysis of the business cycle it is clear that he is judging the phenomena that he describes in terms of the static norms. It is, therefore, an occasion for comment that in his presidential address before the American Economic Association in December of 1924, he should have taken occasion to scrap the “static state” and the general body of economic theory to which the term, statics, properly applies. That many elements in the older economics may be discarded I grant cheerfully, and I would go all the way with Professor Mitchell in dropping studies of “utilities and disutilities . . . in the individual economy.” We need modern social psychology rather than the individualistic psychology of David Hume and Bentham as the basis of present- day economic theory. But a modern theory of value resting on present-day sociology and psychology, so far from throwing out of court the great generalizations based on the notions of supply and demand, cost of production, the laws of wages, interest, rent, and profits, the capitalization theory, the laws of marginal equilibrium among the factors of production, and of the factors of production in different industries, rather strengthens them by giving them a solid foundation. The static-dynamic contrast seems to me particularly to gain rather than to lose by being reformulated in terms of a social theory of value.” Professor Mitchell says: “In recent years many members of our Association have come to fear that economics may disinte- grate into a number of specialties. This danger they combat by insisting that every young economist must receive a thorough grounding in theory. The remedy seems inefficient, because the qualitative theory, in which we are commonly grounded, plays so small a réle in our work as specialists in public finance and banking, in accountancy and transportation, in economic history and insurance, in business cycles, marketing, and labor prob- lems.” I wish to enter a caveat. The student of public finance who does not understand the static theory of the incidence of taxation ' T venture to refer here to the chapter on “The Reconcilation of Statics and Dynamics” in my Value of Money.

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