Economics 312 - Ike Van de Wetering

Econ. 312.  History of Economic Thought.  (3-0)  Cr. 3. S. Prereq: 101.  The logic and explanatory value of received economic doctrines since the middle of the eighteenth century.  The reflection of past economic doctrines in contemporary theory and policy.  Discussion of major works by Smith, Richardo, Mill, Marx, Marshall, Walras, Wicksell, and Keynes.

Fall 2005
Heady Hall 162
MWF 2 p.m.

Instructor:  H. Ike Van de Wetering
281 Heady Hall
515-294-5888
hivdw@iastate.edu
Office Hours:  MTWThF 11:00-11:50 a.m.

Students should use e-mail as the preferred means of communication.

Required Texts:  Ingrid Rima, Development of Economic Analysis, 6th ed. Routledge, 2001.

Lionel Robbins, A History of Economic Thought: The LSE Lectures, edited by Steven G. Medema and Warren Samuels, Princeton University Press, 1998.

Recommended:  Lecture Notes, supplementary handouts.

Texts and articles in the History of Economic Thought available on the Internet

(1) Rod Hay's collection at McMaster University, Hamilton, Canada.

(2) Akama Michio's collection, (1) plus supplementary biographies and bibliographies.

(3) Fonds Paulette Taieb, (1) in addition to many texts in French.

(4) Marx Archives, Colorado State University.

(5) Library of Economics and Liberty

(6) The history of economic thought website

(7) Brad De Long's "Adam Smith deserves a web page of his own"

(8) David D. Friedman's website, Ricardo Quotes, Smith Quotes

Encyclopedias

(1)  Encyclopedie ou Dictionnaire Raisonee: Des Sciences, Des Arts Et Des Metiers, Diderot and d'Alembert, 1752-1772, Electronic Text Version, ARTFL Project, University of Chicago, 1997.

(2) Dictionary of Political Economy, ed. by R. H. Inglis Palgrave, Macmillan, 1900.

(3) The New Palgrave: A Dictionary of Economics, ed. by John Eatwell, Murray Milgate, Peter Newman, Macmillan, 1989.

Biographies (short)

Mark Blaug, Great economists before Keynes, Humanities Press International, Atlantic Highlands, NJ, 1986.

The library of economics and liberty, the concise encyclopedia of economics, biographies

Also see Akamac link (see previous section).

Lecture Schedule
Introduction Syllabus, Textbooks, Websites, E-Texts Ingrid Rima, Development of Economic Analysis (2001) Lionel Robbins, The LSE Lectures (1998)
Textbooks:	Rima Chapter	Robbins Pages	Read no later than	Readings ordered by date
Part 1: Preclassical Economics
1 Early masterworks	1	5-26	Fr 8/24	1
2 The origins of analytical economics	2	35-54	Fr 8/24	1
*3 The transition to classical economics (Munn, Cantillon)	3	104-124	Fr 9/30	5
Part 2: Classical Economics
*4 Physiocracy (Quesnay)	4	77-103	Fr 10/21	6
*5 Adam Smith	5	125-163	Fr 9/30	4
*6 Thomas Malthus and Jean Baptiste Say	6	167-175	Fr 10/28	7
*7 David Ricardo	7	176-200	Fr 9/9	2
*9 Classical Theory in Review	9	231-237	Fr 9/23	3
Part 3: The Critics of Classicism
*10 Forerunners of marginalism (Cournot, Dupuit)	11	238-245	browse
*11 Marx	10	247-257	Fr 11/11	8
*12 (Jevons), Walras	12	258-276	Fr 12/2	10
Part 4: The Neoclassical Tradition
*14 Alfred Marshall	14	303-311	Fr 11/18	9
17 Neoclassical monetary and business cycle theories	17	312-320	skip

Above chapters in Rima and Robbins are required reading. Lectures will concentrate on economists marked with an asterisk. Lecture notes will be mostly distributed in class.

Students will complete 13 short papers.  Each paper has two parts:

Part 1:  a 4-5 page summary and interpretation of the assigned reading(s).

Part 2:   a 1 page written statement offering the student a chance to raise unanswered issues or points not yet fully understood by the student or not considered by   the author of the assigned readings.  Such points and issues will be discussed in the Friday lecture throughout the semester.  It gives the whole class a chance to participate and act with understanding of the material at hand.

Each part of each homework will be graded A, B, C, D or F with comments where appropriate.  Successful completion of homeworks are very important to get a good grade in this course (see the attached grade calculation work sheet for an example).

All homeworks must be completed by the listed due dates (see below).

Econ 312, Fall 2005 Papers for Friday Class Discussion
Number	Due	Author, Title, Chapter(s)	Discussion
1	Fr 8/26	James Mill, Elements of Political Economy (1821), Third ed., 1844, Chapter 1, Production, Chapter 2, Distribution.	Fr 9/2
2	Fr 9/2	Edwin Cannan, The origin of the law of diminishing returns, 1813-1815, Economic Journal, volume 2, 1892.	Fr 9/9
3	Fr 9/9	David Ricardo, On the principles of political economy and taxation, (1817) Third ed., 1981, Chapter 2, On Rent.	Fr 9/16
4	Fr 9/16	David Ricardo, On the principles of political economy and taxation, (1817) Third ed., 1821, Preface, Chapter 1, On Value, Chapter 4, On Natural and Market Price.	Fr 9/23
5	Fr 9/23	David Ricardo, On the principles of political economy and taxation, (1817), Third ed., 1821, Chapter 8, On Taxes, Chapter 10, Taxes on Rent, Chapter 18, Poor Rates.	Fr 9/30
6	Fr 9/30	Adam Smith, An inquiry into the wealth of nations, Volume 1, Introduction and plan of the work, Book 1, Of the causes of Improvement, Chapter 1.1, Of the division of labor, Chapter 1.2, Of the principle which gives occasion to the division of labor, Chapter 1.3, That the division of labor is limited by the extent of the market.	Fr 10/17
7	Fr 10/7	Adam Smith, An inquiry into the wealth of nations, Volume 1, Book 1, Of the causes of improvement, Chapter 1.5, Of the real and nominal price of commodities, Chapter 1.6, Of the component parts of the price of commodities, Chapter 1.7, Of the natural and market price of commodities.	Fr 10/14
8	Fr 10/14	Adam Smith, An inquiry into the wealth of nations, Volume 4, Introduction, Chapter 4.1, Of the principle of the commercial or mercantile system, Chapter 4.2, Of restraints upon the importation from foreign countries of such goods as can be produced at home.	Fr 10/21
9	Fr 10/21	Adam Smith, An inquiry into the wealth of nations, Volume 4, Chapter 4.9, Of the agricultural systems, or of those systems of political economy, which represent the produce of the land, as either the role or the principal source of the revenue and wealth of every country.	Fr 10/28
10	Fr 10/28	Thomas Robert Maltus, An essay on the principle of population as it affects the future improvement of society, with remarks on the speculations of Mr. Godwin, M. Condorcet and other writers, 1798, First edition, Preface, Chapter 1, Question stated, Chapter 2, The different ratios in which population and food increase, Chapter 5, The second or positive check to population examined, Chapter 11, Mr. Goodwin's conjecture concerning the future extinction of the passion between the sexes.	Fr 11/4
11	Fr 11/11	Karl Marx, Value, Price and Profit, The first International Working Men's Association, Edited by Eleanor Marx Arding, Transcribed for the Internet by Mike Ballard, May 5, 1995.	Fr 11/18
12	Fr 11/18	Alfred Marshall, Principles of Economics, (1890) Eighth ed., 1920, Book 5, General relations of demand, supply and value, Chapter 5.1, Introductory equilibrium of demand and supply, Chapter 5.3, Equilibrium of normal demand and supply, Chapter 5.15, Summary of the general theory of equilibrium of demand and supply.	12/2
13	Fr 12/2	Leon Walras, Elements of price economics, or the theory of social wealth (Jaffe translation based on 1926 Edition Definitive), Part 4, Theory of production, Lesson 20, Production equations, Lesson 21, Solution of the equations of production.  The law of the establishment of the prices of products and services.	12/9

Students are expected to write a substantial term paper.  They have at least three alternatives as outlined below.

Alternative 1:  (very popular)

Choose a major economist.  Choose a major available text by that economist (consult the available texts on the Internet).  Ascertain the availability of a major biography on that economist (check the Akama Michio link on the class homepage).  Thoroughly read part or all of your chosen text.  Review the biography.

Alternative 2:  (not so popular)

Write an analytical paper on one of the following schools of economic thought (1) mercantilism, (2) physiocracy, (3) classical economics, (4) Marxian economics, (5) neoclassical economics (including Walrasian economics), (6) Keynesian, or (7) Austrian economics.  Emphasize, wherever possible, the underlying model used.  Why was the school valid and useful in its time?  What is the contemporary relevance of that school?  Hint:  write on classical economics, use the material in your 13 essays and the lecture notes as a major starting point.

Alternative 3:  (challenging, several students last semester went this route).

Choose a Nobel Laureate (e.g. Samuelson, Stigler) or major economist who has written on the economics of Smith, Ricardo, Marx, Mill, Marshall.  Review one or two articles by those economists, as if you were preparing a lecture for Econ 312.

For either Alternative 1, 2 or 3 write a 20-page paper.  Pay close attention to clarity, originality, correctness and depth of exposition.  Spelling, grammar, citation and bibliography matter.

The due date for the term paper will be Thursday, December 8.  Mark your calendars please!

Students are expected to attend class regularly.  Those that do will earn credit accordingly (see the grade calculation sheet for an example).  Roll calls will be taken every lecture.

The lectures focus on economic analysis.  By nature they will be technical, analytical, and logical rather than descriptive.
 
Finally some good news for senior, juniors, sophomores and possibly freshmen:  this course dispenses with midterm and final examinations.  The 13 papers constitute a focussed substitute for in-class examinations.

Input Demand

Malthus

Marx

Marshall

Grade Calculation Worksheet

I.  Essays and derived questions
	Weight	Example Grade	(Weight)*(Grade)
No. 1	.05	A	.200
2	.05	B	.150
3	.05	C	.100
4	.05	D	.050
5	.05	F	.000
6	.05	A	.200
7	.05	B	.150
8	.05	C	.100
9	.05	D	.050
10	.05	F	.000
11	.05	A	.200
12	.05	B	.150
13	.05	C	.100
II. Term Paper (see syllabus)	.15	A	.600
III. Class Attendance
30 or more (A)	.20
25-29 (B)	.20	B	.600
20-24 (C)	.20
15-19 (D)	.20
18 or less (F)	.20
Note:  no midterm, no final			Sum 3.100 Rounded Sum 3.10 Course Grade B+

Letter Grade			Letter Grade
A	3.68-4.00		C	1.68-2.00
A-	3.34-3.67		C-	1.34-1.67
B+	3.01-3.33		D+	1.01-1.33
B	2.68-3.00		D	0.68-1.00
B-	2.34-2.67		D-	0.01-0.67
C+	2.01-2.33		F	.00-0.00

Note: regular class attendance and successfully completing abstracts and interpretation of assigned readings are a virtual necessity to obtain a B+, A- or A course grade in this class.
 

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