History of Economic Theory
ECON 3531 Fall 2012
Department of Economics, Temple University
Instructor: James Bailey Email:
Class Location: Ritter Annex 707 Office Location: Ritter Annex 834
Class Time: T R 2:00-3:20 Office Hours: T R 12:00-2:00
“The ideas of economists and political philosophers, both when they are right and when they are wrong, are more powerful than is commonly understood. Indeed the world is ruled by little else. Practical men, who believe themselves to be quite exempt from any intellectual influence, are usually the slaves of some defunct economist.” –John Maynard Keynes
Required Books:
Worldly Philosophers, Robert Heilbroner, 7th edition, ISBN 978-0684862149
Hayek’s Challenge, Bruce Caldwell, University of Chicago Press, ISBN 978-0226091938
Recommended Books (Books are required, but available for free online; paper copies recommended):
Wealth of Nations, Adam Smith, Liberty Fund, ISBN 978-0865970083
Principle of Population, Thomas Malthus, Norton Critical Edition, ISBN 978-0393924107
General Theory of Employment, Interest and Money, John Maynard Keynes, Harcourt, Brace & World 1964 edition, ISBN 978-0156347112
Prerequisites: None required; Principles of Economics helpful
Course Goals: After this course, you should understand:
a. How to read and discuss difficult primary sources
b. What are the major ideas associated with each group or thinker studied
c. How economic theory is influenced by other fields and by the real-world circumstances of the day
d. How economics came to be the way it is, how it could have been otherwise, how to read previous thinkers on their own terms rather than as imperfect versions of current theory
General Course Information:
This course will involve much more reading, writing and discussion, and much less math and problem sets, than you are used to from other economics courses.
Attendance is not mandatory, but you need to come to class and do the reading in order to keep up. It is easy to fall behind.
Makeup exams will only be given if satisfactory proof (e.g. a doctor’s note) is given of a student’s illness or other extenuating circumstances.
Cell phone use is not permitted during exams.
Grade Scale: A 90-100; A- 87-90; B+ 84-87; B 80-84; B- 77-80; C+ 74-77; C 70-74; C- 67-70; D+ 64-67; D 60-64; D- 57-60; F below 56
Course Grade:
Reading Summaries/Participation 20%
Paper 40%
Final 40%
Important Dates:
January 22nd / First Day of ClassFebruary 4th / Last Day to Drop
March 10th-17th / No Class, Spring Break
March 26th / Last Day to Withdraw
April 30th / Paper Due
May 2nd / Last Class, Final Exam
Disability Policy: (Per University Policy # 02.78.13) Any student who has a need for accommodation based on the impact of a disability should contact me privately to discuss the specific situation as soon as possible. Contact Disability Resources and Services at 215-204-1280 or go to 100 Ritter Annex to coordinate reasonable accommodations for students with documented disabilities.
Statement on Academic Freedom: Freedom to teach and freedom to learn are inseparable facets of academic freedom. The University has adopted a policy on Student and Faculty Academic Rights and Responsibilities(Policy # 03.70.02) which can be accessed through the following link: http://policies.temple.edu/getdoc.asp?policy_no=03.70.02.
Outline for History of Economic Thought
Readings TBA
I. The Early History
A. The Middle Ages and the Scholastics
B. Mercantilism – French and English
C. The Rise of Science and Scientific Method
D. The French Enlightenment and the Physiocrats
Readings: Worldly Philosophers Chapters 1-2
II. Adam Smith
A. Life
B. The Scottish Enlightenment
1. Related Thinkers: Hume, Ferguson
C. Theory of Moral Sentiments and “Das Adam Smith Problem”
D. Wealth of Nations
Readings: Worldly Philosophers Chapter 3, Wealth of Nations Book 1 Chapters 1-4
III. Thomas Robert Malthus
A. Life and Times – Godwin, Condorcet, and the French Revolution
B. The Essay on Population
C. The Principles of Economics
D. Interpretative Issues
1. Was he right about population?
2. Was he a precursor of Keynes?
Readings: Worldly Philosophers Ch 4, Principle of Population ch 1-5 (p15-43) plus pages 125-128
IV. David Ricardo
A. Life and Times – Utilitarians, Napoleon, Politics, Corn Laws
B. Ricardo’s Contributions
C. Ricardians and the anti-Ricardo reaction
D. Interpreting Ricardo
V. John Stuart Mill
A. Personal Life, On Liberty
B. Utilitarianism
C. Principles of Political Economy
Readings: Worldly Philosophers Ch 5
VI. Karl Marx
A. Origins of Marx’s Thought – Hegel, Utopian Socialists, and British Political Economy
B. Marx’s Laws of Motion of Capitalism – Exposition and Appraisal
C. The Marxian Tradition – see handout
Readings: Worldly Philosophers Ch 6, Joan Robinson’s Open Letter
VII. The Marginal Revolution
A. Hutchison’s analysis of reaction to politics, theory, method
B. The Early Marginalists – dehomogenizing the emphasis on utility
1. Jevons – utilitarian theory
2. Menger – subjectivism and unintended consequences
3. Walras – general equilibrium and Pareto
4. The German Historical School and the Methodenstreit
Readings: Hayek’s Challenge Chapter 1
VIII. Alfred Marshall and the Cambridge School
A. His life, his influence on Cambridge, his economics
B. The Principles of Economics
C. The Marginal Revolution Redux – the Mirowski Thesis
Readings: Worldly Philosophers Chapter 7
IX. John Maynard Keynes
A. Life and Times
1. Keynes, Cambridge, and pre-war Britain
2. England in the 1920’s, and the gold standard
3. The evolution of the Treatise
B. The General Theory and the Keynesian Revolution
Readings: Worldly Philosophers Ch 9, General Theory Chapters 1, 2, 24
X. Discordant Currents
A. American Institutionalism
Readings: Worldly Philosophers Chapter 8
B. Methodology of Economics
C. Hayek and the Austrian School
Readings: Hayek’s Challenge, Chapter 10 (Economics and Knowledge, page 205-231) or: Hayek 1945 “Use of Knowledge in Society”
XI. What To Make of the Twentieth Century?
A. From the Neoclassical Synthesis to Modern Macro
B. From Arrow-Debreu to Game Theory and the Economics of Information
C. Metrics
D. Interpretive Frameworks – Stiglitz, Mirowski, Backhouse, Caldwell