A history of economic doctrines : $b from the time of the physiocrats to the present dayGide, Charles
History
A history of economic doctrines : $b from the time of the physiocrats to the present day
Gide, Charles
Economics -- History
It is very curious that Smith should have failed to make the best
possible use of this theory. Its full significance was lost upon him.
The theory of division of labour alone was sufficient to dispose of the
whole Physiocratic system. Nevertheless, in the last chapter of Book IV
we find him still valiantly struggling to disprove the conclusions of
the Physiocrats, by the aid of arguments not always very convincing.
Forgetting his principle of division of labour, he even adopts a part
of their thesis and finds himself entangled by the invalid distinctions
which they had drawn between productive and unproductive workers. He
simply gives another definition and describes as unproductive all works
which “perish in the very instant of their performance, and seldom leave
any trace or value behind them for which an equal quantity of service
could afterwards be procured.”[142] All these services, which comprise
the labours of domestic servants, of administrators and magistrates,
of soldiers and priests, of counsellors, doctors, artists, authors,
musicians, etc., Say classed together as “immaterial products.” By
restricting the term “productive” to material objects only, Smith gave
rise to a very useless controversy on the nature of productive and
unproductive works—a controversy that was first taken up by Say and
revived by Mill, but which to-day seems to be decided against Smith,
thanks to a more exact interpretation of his own doctrines. It is,
indeed, quite clear that all these services constitute a part of the
annual revenue of the nation, and that “production” in a general sense
would be diminished if some persons did not exclusively devote themselves
to the performance of such tasks.
After criticising the Physiocratic distinction drawn between the
wage-earning classes and the productive, Smith immediately admits that
the labour of artisans and traders is not as productive as that of
farmers and agricultural labourers, for the latter not only return the
capital employed by them together with profits, but they also furnish the
proprietor with rent.[143]
Whence this hesitation on the part of Smith? Where did he come by the
idea of the special and superior productivity of agriculture? An attempt
to account for it may prove interesting, and it will help us to give
Smith his true place in a history of economic doctrines.
Public-domain text, read in full here on John Shaqi.
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