The loan fund theory of capital was developed by the unheralded American economist, Herbert J. Davenport (1861-1931). Davenport's name has virtually disappeared from writings on the history of economic thought. Today, he seems best known as a teacher of Frank Knight at Cornell around 1915. Davenport wrote three major books during an 18-year period between 1896 and 1914. The first (1896) was a treatise based on what he called the “principle of sacrifice,” or subjective opportunity cost. His second book, Value and Distribution (1908), covered much of the same ground but also presented some original contributions. It marked his emergence as a professional economist, since he presented his ideas within the context of an appraisal of classical and neoclassical economic doctrine. Among other things, the book contained a penetrating, subjectivist critique of four ideas in the history of subjectivist economics: marginal utility, Eugen von Bohm-Bawerk's theory of capital, Friedrich Wieser's theory of cost, and Frank Fetter's theory of market interest. It also introduced the loan fund theory of capital, which is the topic of this paper.

The dominant metaphor of conceptual relativism, that of differing points of view, seems to betray an underlying paradox. Different points of view make sense, but only if there is a common co-ordinate system on which to plot them; yet the existence of a common system belies dramatic incomparability (Davidson, 1984, p. 184).

From this same rostrum several years ago, outgoing president Bill Barber (1990, p. 110) said that presidential addresses tend to fall into one of two broad categories. Category I speeches typically survey the state of the art, identify promising directions for future research, and attempt to justify our scholarly existence to skeptics who doubt the value of studying the world of dead economists. Category II speeches draw their form and substance from the speaker's particular research interests.

Austrian economics is arousing increasing interest, not to say enthusiasm, these days. No doubt this is in part due to the collapse of the planned economies of the Soviet type, which has lent credibility to the claims of Ludwig von Mises and Friedrich Hayek regarding the impossibility of rational economic calculation under socialism-claims which were disputed by the mainstream neoclassical economists of a generation ago. The phenomenon also reflects a relatively long-standing dissatisfaction with neoclassical economics. For many years it was the radical critics of capitalism who felt most keenly the attractions of alternative approaches in economics. Now, increasingly, champions of the market are coming to believe that neoclassical theory does not offer a deep and firm enough basis for asserting the virtues of the market system, and the counterproductive effects of government intervention therein.

The works of Adam Smith are filled with quotable moments. The pin factory. The poor man’s son. The invisible hand. The butcher, the brewer, and the baker. The dog and the philosopher. The impartial spectator. The man of system and his chessboard. And our propensity to truck, barter, and exchange. All of these are so well known and so often quoted that I’ve had editors ask me just to refer to them in passing rather than quoting them in full.

Though the Chicago school has been the subject of no small amount of research over the past several decades, that scholarship has focused largely on persons, ideas, and influence—in short, on the school itself. No attention has been paid to the origins of that label and the avenues via which the notion of a “Chicago school” of economics came to be. This paper attempts to address that lacuna, drawing on both published and archival resources. What emerges is a story of a label of uncertain origin but wrapped up in competing agendas, the first stage in the history of which culminates in 1962 with its rejection by two of the very people who helped birth it.

I defended my doctoral dissertation on stochastic stability of general equilibrium systems in Penn’s Applied Mathematics program in fall 1968. That year I began teaching math for economists, mathematical economics, microeconomics, and even econometrics at Rutgers College, where I remained for a couple of years before moving to Duke. At Rutgers I saw that graduate students took required courses in micro, macro, statistics, math, and econometrics, and there were electives in other fields like public finance and economic history. I didn’t know that there was any subdiscipline, or field, called the history of economic thought.

I attended the now famous conferences at Sussex in 1968 and Nottingham in 1969 that preceded the later founding of both the History of Economic Thought Society in the UK and the History of Economics Society (HES) in North America. In 1969, I also helped to found the UK Money Study Group at its first conference in Hove, while in 1970 I was at Karl Brunner’s first Konstanz Seminar. In both fields, these conferences were followed by many, many more. At that time new specialist journals were also appearing. The Journal of Money, Credit and Banking (JMCB), where I had a paper in the second issue, started life in 1969. So did History of Political Economy (HOPE), but there I had nothing to submit. Ironically, given Lionel Robbins’s still notorious attack on this proposed journal at Sussex, to which I shall return below, my first completed research paper in history of economic thought (HET)—on Thomas Tooke (Laidler 1972)—was already committed to his forthcoming Festschrift.

This paper aims at understanding social practices and institutions that ensured the transnational diffusion, recognition, and renewal of the research program in the General Equilibrium Theory (GET), in spite of multiple critics and apparent theoretical dead ends. First, we trace the main conceptual developments of the Walrasian GET program since the 1950s and thus elaborate on its intellectual identity. Then, based on a systematic study of the educational and professional trajectories typical for several generations of GET scholars, we analyze a social form taken by this transnational and multidisciplinary “scientific community”: an institutional dynamics of the Walrasian GET program, most common career patterns, and the forms of international and intergenerational transmission. We construct a database of GET theorists and apply to this dataset a technique of Multiple Correspondence Analysis (MCA) in order to investigate the relational patterns between attribution of scientific credit (symbolic capital) and biographical properties in a transnational space of the GET scholars.

The outspoken social reformer Mary Clare de Graffenreid (born 1849, died 1921) stood out among the handful of early women members of the American Economic Association (founded 1885) as the winner of two essay competitions. In 1889, Clare de Graffrenreid’s essay shared the $100 first prize in an AEA essay competition on child labor, and appeared the following year in the Publications of the American Economic Association (1st series, 5, 2, March 1890, pp. 194–271). In 1891 her essay “The Condition of Wage-Earning Women” (published in Forum 15, March 1893, pp. 68–82) won the $300 first prize in an AEA essay competition on women workers (the $200 second prize went to Helen Campbell’s “Women Wage Earners,” 1893). Her valedictory address at Wesleyan Female College in Macon, Georgia, in 1865 provided her first taste of public controversy, as the general commanding Union troops in the area responded by placing the college under guard and threatening to close it, but by far the most controversial of her twenty-seven publications was “The Georgia Cracker in the Cotton Mill” (Century Magazine, February 1891). This paper examines de Graffenreid’s career and contributions, and what her career reveals about the paths for women to participate in the AEA and the American economics profession in the late nineteenth century. After teaching Latin, literature, and mathematics for a decade at Georgetown Female Seminary, de Graffenreid had a non-academic career as an investigator with the Bureau of Labor (from 1888, Department of Labor) from 1886 until she retired in 1906. Despite her AEA prizes, her published lectures to other conferences (YWCA, National Conference of Charities and Correction), and her published testimony to the Industrial Commission on the Relations of Capital and Labor, she was never on the program of an AEA meeting. Like other women economists of her time, de Graffenreid crossed boundaries between scholarly research and social reform, and between different scholarly disciplines (e.g., publishing “Some Social Economic Problems” in American Journal of Sociology, 1896). The paper examines how essay competitions provided women such as de Graffenreid and Campbell (and Julie-Victoire Daubié and Clémence Royer in France) with a voice in the predominately male economics profession of the late nineteenth century.

When scholars investigate the legacy of John Maynard Keynes’s Treatise on Probability (1921) for the development of Keynes’s thinking, the attention usually focuses on the connections among Keynes’s probability theory, his conception of decision-making under uncertainty, and the theory of the functioning of the macroeconomic system that derives from it—through the marginal efficiency of capital, the preference for liquidity, and the self-referential functioning of financial markets. By contrast, this paper aims to investigate the connections between Keynes’s probability theory, on the one hand, and his economic policy recommendations, on the other. It concentrates on the policy recommendations defended by Keynes during the Great Depression but also after the General Theory. Keynes’s economic policy can be understood as a framework for decision-making in situations of uncertainty: fiscal policy aims to induce private agents to change their “rational” probability statements, while monetary policy aims to allow more weight to these statements.