In Christian Weber's opinion in the preceding article in this journal, although Vilfredo Pareto never wrote his utility function in the Cobb-Douglas form U = rβbrγc, he did present an early, if incomplete, discussion of a Cobb-Douglas utility function. Weber's sections II and III try to document his opinion.

Weber's section II examines Pareto's “Considerazioni” (1892) on the assumption that the marginal utility πi, of good i depends only on the level ri, of consumption of that good. Section III examines Pareto's Manual (1909) on the assumption of “additive separable” utility functions.

In a recent paper (1994) in this journal, Elias L. Khalil makes two claims. First, he contends, the law of the tendency of the rate of profit to fall is not unique to the capitalist mode of production but it is equally valid in a socialist economy. Second, a decline in the rate of profit in a socialist economy would engender crises as would be the case in a capitalist economy. Even more, he argues that crises would be necessary in any social form if there is a secular tendency of the organic composition of capital to rise.

Although in the past some of the best-known trade specialists have lavished praise on Vilfredo Pareto's theory of international trade, this aspect of his writings has been neglected for many years. Pareto's name figures in trade-theoretic articles only combined with the word “optimum,” as if the concept of a “Pareto optimum” constituted the beall and end-all of Pareto's contribution. This parallels Pareto's fame as a general economic theorist, of which it has recently been said that “it is disappointing that this reputation should be constructed on the basis of such a small part of his work” (Kirman 1986, p. 808).

Economists and finance researchers have long recognized the “close relation between the measurement of inequality and the measurement of risk” (Breitmeyer et al., 2004). Economists today agree that a measure of income inequality must respect the Pigou-Dalton transfer principle, that is, inequality cannot increase with a transfer from a richer person to a poorer person. Finance researchers today agree that a measure of risk must respect the diversification principle, that is, risk cannot increase when portfolios are combined. Where did these convictions originate? While both principles were advocated early in their respective fields, they were not viewed as definitive until relatively recently. In both fields major empirical and theoretical efforts were mounted in support of various conceptualizations at odds with these two principles. For example, Robert Gibrat advocated the use of the variance of log income despite the fact it is inconsistent with the Pigou-Dalton principle. In finance, value at risk (VaR), although it can violate the diversification principle, was widely advocated. People supporting research programs at odds with Pigou-Dalton or the diversification principle, based those programs on ambitious empirical and theoretical claims about distributions. Such claims could have been right and are not a priori or logically false. The purpose of this paper is to review these “at odds” conceptualizations, the types of arguments advanced for their legitimacy, and the reasons they have been given up.

This work presents the elements of economic analysis of law that occur in the thought of Gaetano Filangieri. In the pages of La Scienza della Legislazione the Neapolitan writer develops a utilitarian and economic investigation that pays attention to the judgments individuals make over social phenomena at the margin point. A proof of this development can be found in the explanation of the principle of decreasing marginal utility, argued in Head XXXI of Book III, which represents one of the most effective demonstrations that can be found before the end of nineteenth-century literature. The most remarkable fact is that, of all the five parts that compose the Filangierian work, the most rich in economic arguments is dedicated to “Criminal Laws.”

This article will point out this and other innovative results of the Filangerian analysis, and will also offer a reconstruction of the economic theory on crime and punishment presented in La Scienza della Legislazione. Filangieri’s criminal doctrine represents a significant example of the Enlightenment antecedents of “law and economics,” as well as the better known contributions made by Beccaria and Bentham.

The abolition of slavery in the nineteenth and twentieth centuries was a long process. In terms of the economic views of abolitionists, there has been an excessive focus on the economic ideas of liberal abolitionists and their approach to “Civilization, Christianity, and Commerce.” However, there was a “developmental abolitionism” that has received little attention. Afro-American Martin R. Delany and Liberian James S. Payne were writers who approached abolitionism through this developmentalism. They favored more interventionist measures aimed at building the material power and national autonomy of Black nations to undercut the power of slave-using African chiefs, to provide indigenous Africans with employment, and to undermine the profitability of slave-based cotton production in the Americas. They also implicitly and indirectly approached labor scarcity with solutions ranging from promoting labor-saving technology to cultivating national prosperity that would improve emigration to Africa or increase birth rates.

The London Economist of June 14, 1997, carried an article by Jeffrey Sachs (1997) entitled “The Limits of Convergence: Nature, Nurture and Growth,” which explores the relationship between geography, economic policies and institutions, and economic growth on the basis of recent econometric work. Four principal groups of factors were found to account for the sizable difference in per capita income growth between the South-East Asian countries and other less successful developing countries: initial economic conditions (such as the income gap separating poor countries from rich ones), policy variables, demographic factors, and resources and geography. One of the most significant conclusions (Sachs, 1997, p. 20) is that “openness was decisive for rapid growth. Open economies grew 1.2 percentage points per year faster than closed economies, controlling for everything else.”

Oddly enough, my first clear recollection of an encounter with an economic proposition dates from the age of six or seven, when my father (who died suddenly from the pneumonia when I was eight) casually remarked that the Colman Mustard Company derived most of its profits from the residue people left on their plates. Unfortunately at the time I did not appreciate the analytical subtlety of this observation. Nor, I suspect, did my father, who probably only wanted to particularize the familiar maxim: waste not, want not. Nevertheless, the point evidently stayed in my mind, though I cannot claim it as the origin of my subsequent fascination with economics. The evolution of my attitudes to economics will tie considered later. First, however, let me briefly sketch some relevant features of my personal and socio-economic background, which may shed some light on my subsequent intellectual activities.

Allin Cottrell's criticisms of my paper fall into three general categories: criticisms of the paper I did not write, criticisms of the paper I claimed to write, and criticisms of the paper he thinks I was really writing. Let me try to address each of these categories, emphasizing the more substantive points he raises about the paper I claimed to write.

Over thirty years ago, Bronfenbrenner characterized Japanese economics in terms of “sectarianism, inbreeding and schizophrenia” (1956, p. 390). This paper explores the validity of these characterizations in relation to the contemporary Japanese scene. The main focus will be an institutional analysis of academic economics as conducted within the Japanese university system.