Latest From the Debate on 'Farewell to Alms' by Gregory Clark at Marginal Revolution

Over at Marginal Revolution, Gregory Clark's Farewell to Alms contionues to be debated.

Gregory Clark coments on my contributions:

'Smith is all about Smithian Growth in the millenia leading to 1776 - the expansion of the economy by reducing the impediments to trade, and thus extending the division of labor. This growth thus has at its base institutional improvements. Some modern economists, such as Avner Greif, give great weight to an extension of this vision whereby the key to growth is the devising of institutions which allow trade.
AFTA argues these processes, at least in the years 1200-1800 in England, were inconsequential. Trade possibilities were probably as good in 1300 as in 1800. The economy had improved somewhat, but technological advance dominated throughout.
AFTA thus argues for many purposes, Smith was a minor figure. The great intellectual figure of the era was Malthus, whose thinking was much more attuned to the realities of the pre-industrial world."

To which I replied this morning:

"Gregory Clark neatly summarises his impression of the differences between our approaches. Let me be clear: I have no axe to grind for forcing Adam Smith as a ‘major’, nor resisting an assessment that he was a ‘minor’, figure. It seems to me as a reader of Greg’s book (rigorously following Tyler’s ‘rules’ to read and debate in restricted order to page 272), that much of what Gregory asserts as ‘new’, ‘last 70 years research’, etc., about the period to 1800 (itself an arbitrary watershed) was discussed in detail by Adam Smith (WON, and LOJ), and indeed formed much of his distinct contribution, and was in place before 1763. That is all I have been saying in this debate. Greg rejects these statements, but so far in AFTA (what a brilliant contraction!) I read nothing to contradict the view that Greg has a view of Adam Smith heavily influenced by The Neoclassical Distortion. It would be better if he demonstrated he had read WON and LOJ.

That ‘Trade possibilities were probably as good in 1300 as in 1800’, I find breathtaking. I have noted his references and will read these on my return to Edinburgh from France in October. But I find it weird (‘exasperating’ even) that Greg make these sorts of grand statements. Exactly what were people in 1300 going to trade (and with who?) in 1300 comparable to what they could trade in 1800 among themselves and with Europe and north America (Europe couldn’t even sail to America until the end of the 15th century).

Feudal agriculture was not a place that potential traders could wander off their Lord’s lands (with what?) and go to the mainly miserable collection of hovels, called ‘towns’, and take advantage of hardly existent trade potentials. This was not the American ‘west’. In find references to that period being ‘laissez-faire’ problematical (it wasn’t in France, the source of the laissez-faire phrase in 1690).

There were pedlars travelling long distances across Europe with what they could carry for petty trades a few centuries after 1300. This was part of the long and slow process of the re-emergence of the age of commerce, and it had a long way to go before trade became significant. The Elizabethan government adopted a policy of encouraging domestic manufacture (early import substitution of ‘luxury’ goods and ‘secret’, i.e., ‘stolen’ technologies), to reward the people who established them (often, incidentally ‘merchant’ adventurers who were the younger sons of well-off local people!) and to set to work ‘indigent’ and unemployed familes, children included. From the early 1600s to the mid-18th century, local dispersed commercial process continued in fits and starts, often suppressed by the town guilds, letter patent, and outright corruption, otherwise known as mercantile political economy) to establish the markets that Greg claims were always there since 1300.

So my ‘axe’ is not so much to heap praise on Adam Smith as to question Greg’s narrative supporting his impressive and interesting data. My only comment on Malthus, writing in the early 1800s, is that his major idea – the ‘Malthusian trap’ – appeared at the moment it was being thwarted.

As stated, I look forward to reading the next chapters. If I am wrong I shall admit to it. So far I think Greg has to have a ‘big finish’."

Comment
There is a lively debate in progress at Marginal Revolution here
and you will gain much from it.

You should also read Gregory Clark's 'Farewell to Alms' (Princeton University Press)