John Maurice Clark: A Social Economics for the Twenty-First Century

210 Pages·1997·19.168 MB·English

by  Laurence Shute (auth.)

JOHN MAURICE CLARK
CONTEMPORARY ECONOMISTS
General Editor: John Pheby, Professor of Political Economy,
De Montfort University, Leicester, England
The Contemporary Economists series is designed to present the key ideas of the
most important economists of this century. After an opening biographical
chapter, the books in this series focus on the most interesting aspects of their
subject's contribution to economics, thus providing original insights into their
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Published titles
John F. Henry JOHN BATES CLARK
Steven G. Medema RONALD H. COASE
Michael Schneider J. A. HOBSON
James Ronald Stanfield JOHN KENNETH GALBRAITH
John Maurice Clark
A Social Economics for the
Twenty-First Century
Laurence Shute
Professor of Economics
California State Polytechnic University. Pomona
Pomona. California
First published in Great Britain 1997 by
MACMILLAN PRESS LTD
Houndmills. Basingstoke. Hampshire RG21 6XS and London
Companies and representatives throughout the world
A catalogue record for this book is available from the British Library.
ISBN 978-1-349-25581-8 ISBN 978-1-349-25579-5 (eBook)
DOI 10.1007/978-1-349-25579-5
First published in the United States of America 1997 by
ST. MARTIN'S PRESS, INC.,
Scholarly and Reference Division.
175 Fifth Avenue. New York. N.Y. 10010
ISBN 978-0-312-16525-3
Library of Congress Cataloging-in-Publication Data
Shute. Laurence.
lohn Maurice Clark: a social economics for the twenty-first
century 1 Laurence Shute.
p. cm. - (Contemporary economists)
Includes bibliographical references and index.
ISBN 978-0-312-16525-3
I. Clark.lohn Maurice. 1884-1963. 2. Economists-United States
-Biography. 3. Statics and dynamics (Social sciences) I. Clark.
lohn Maurice. 1884-1963. II. Title. III. Series.
HB119.C53S55 1997
330'.092-dc20 96-34662
CIP
© Laurence Shute 1997
Sof'tcover reprint of the hardcover 1s t edition 1997
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with the Copyright. Designs and Patents Act 1988.
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sustained forest sources.
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06 05 04 03 02 01 00 99 98 97
Contents
Preface ix
1 Background and Origins 1
The Clark Family Background 1
John Bates Clark 3
J.M. Clark - The Early Years 7
2 An "Examination of Premises" 13
The Need for Realistic Psychological Assumptions 14
A Provisional "Theory of Guidance" 21
The Empire of Machines 27
After Statics, Dynamics: The Study of Cumulative
Evolutionary Process 29
The Selection of the Problem 31
3 The Emergence of Overhead Costs 37
Clark's Dissertation - A First Approach 37
The Discovery of Overhead Costs 40
Price Discrimination as a Response 44
Cutthroat Competition and Monopoly 47
Some Relations to Business Cycles 53
Towards Economic Stabilization 55
4 Control of Industry - By Business and Society 61
Clark's Dissertation and the Changing Requirements
of Public Control 61
The Evolution of Control 63
Control in the Modern Period 71
Types of Public Controls 76
5 Problems of War, Depression, and Effective
Competition 84
The Costs of the World War 85
Strategic Factors in Business Cycles 92
The Economics of Planning Public Works 98
Inflation and the New Dogma of "Keynesianism" 103
Competition as a Dynamic Process 106
v
Contents
VI
6 Economics and the Bridge to Ethics 116
The Orthodox View 116
Clark: Economics as The Bridge to Ethics 117
The Bias of the Market 118
An Economic Constituent Assembly for Reconstruction 121
An Indispensable Factor of Production 124
7 J. M. Clark - An Evaluation 125
Notes and References 128
Appendix A 159
Appendix B: Bibliography of John Maurice Clark 160
Bibliography of J. M. Clark: Addendum I 177
Bibliography of J. M. Clark: Addendum II 178
Notes for Appendix B and Biography of J. M. Clark 179
Selected Bibliography 183
Index 192
To J.D. and D.J.D.
"There is no beginning; we know nothing about beginnings;
there is always continuity with the past, and not with anyone
element only of the past. but with the whole interacting
organism of man."
Charles Horton Cooley
Social Process (1918)
Preface
John Maurice Clark was one of the seminal social thinkers of the
twentieth century and his work provides the foundation for a
dynamic economics of the twenty-first century: for a Social econo
mics. The extent and depth of Clark's contributions were often
obscured by his quest to build bridges to orthodox, received, schools
of economics; to convince them; to win them over. Moreover, Clark
also sought to build bridges to the heterodox schools in economics,
including the Institutionalist and Marxian - he considered Marx an
Institutionalist. In this process, however, Clark often used language
so temperate as to obscure the prodigious reconstruction in econ
omic theory that he was formulating. He argued persuasively that
prices were not the aim, end or final measure of things economic,
nor were costs definite, absolute measures: they were functions of
the institutional structures of society. It was necessary, in Clark's
view, to create an economics of responsibility - of social responsi
bility. His work remains astonishingly modern 'in content and scope
today, at the dawn of the twenty-first century.
Manuscript sources which have been consulted are listed in the
bibliography. Wherever the J.M. Clark Papers are mentioned, the
reference is to the primary collection in the Columbia University
Libraries unless otherwise stated. Copies of all of J.M. Clark's
unpublished works are in the author's possession.
This work has had a long gestation period and I am grateful to
more people for assistance and encouragement than I can possibly
mention. Above all, however, I would like to thank Joseph
Dorfman, Donald Dewey, and Abraham Hirsch - each of whom at
crucial periods contributed in memorable ways. Sharon Sterling
contributed a great deal by formatting this on computer disk.
Although this work is written for the professional economist and
social theorist, it is hoped - in keeping with Clark's lifelong
approach - that much of this will be intelligible to thoughtful men
and women everywhere; the themes are universal and most definite
ly not simply "economic" in today's narrow and constricted sense
of the word.
ix
1 Background and Origins
John Maurice Clark, who became a leading American Economist in
the mid-twentieth century, was born on 30 November 1884 in
Northampton, Massachusetts. He was the third son of John Bates
Clark, himself the leader of the mainstream in American economics
towards the close of the nineteenth century, and Myra Almeda
(Smith) Clark, a graduate of Vassar College. As a member of this
family, the young Clark had a number of unusual opportunities to
make a decisive impact on the American intellectual and social
tradition.
That he did so in fact is stilI remarkable. As the historian of
American economics has noted: "There have been few cases of
successive generations of a family substantially contributing to the
advancement of knowledge. Certainly in the field of economics it
has been rare." However, "The United States can ... boast of that
rarest of cases: a father and son both of whom achieve[d] the rank
of seminal thinkers. This was the fate of John Bates Clark and John
Maurice Clark, both of Columbia University."]
THE CLARK F AMIL Y BACKGROUND
His place of birth is indicative, since the Clark family had deep
roots in the soil of Puritan New England.2 Throughout the writings
and actions of both the younger Clark and his father, the themes
of those Puritan pioneers who had struggled to build a "Zion in the
wilderness" run intensely and steadily. On the eve of his eightieth
birthday, John Bates Clark remarked to an audience of friends and
colleagues assembled in his honor that he had once visited one of
his great-grandfathers who fought in the Revolutionary War. "I
saw him," Clark said, "conversed with him, ... and I have his
journal, kept during the war." The elder Clark then emphasized, "at
second hand, I remember the American Revolution.") The father's
theme of continuity with the past was characteristic of the son as
well. John Maurice Clark was, to the end of his life, to frequently
underscore the notion that the direction and significance of his
labors were to be seen as a continuation of his father's work.4
Indeed, "Throughout his career [J.M.] Clark proclaimed his debt to
1