European Society for the History of Economic Thought

Bertram Schefold



Bertram Schefold



Mister Rector, Dear Colleagues, Ladies and Gentlemen

It is a pleasure for me to open the sixth conference of the European Society for the History of Economic Thought (ESHET) in Crete. It is an honour for us that this conference takes place in the context of the 25th anniversary of the founding of the University of Crete. Some of us have had the opportunity to read the list of events which will take place in the course of the celebrations, in particular those organised by the School of Social Sciences and the Department of Economics at Rethymno. This list is impressive, and we are grateful to be included. The conference received generous support from the following institutions: University of Crete, Ministry of Foreign Affairs, Bank of Greece, Ernst & Young.

Our previous conferences took place in Marseilles, Bologna, Valencia, Graz and Darmstadt. We have now gone back to the southern part of Europe, actually the preferences of the members, and, looking at the weather, I cannot blame them, remembering the snow in Darmstadt. The Society is in a healthy state. This will be discussed at the Annual General Meeting, to be held tomorrow. I hope that you will all participate in this meeting, whether you are a voting member of our society or a guest. The Executive Committee has met this morning and made its preparation. I hope that the annual meeting will be short, efficient and informative. We shall report on the elections, elect the new Council, discuss honorary membership and prizes, look forward to future conferences, including a possible future world conference on the history of economic thought, and report on publications of past activities.

One of our honorary members is here tonight, Professor Grice-Hutchinson. At a Nestorian age, she was not afraid to travel here from Malaga in Spain, to an audience of devoted admirers of herpath-breaking works on the economics of Spanish Scholasticism and the School of Salamanca.

I should like to thank the local organisers of this conference, in particular Professor George Stathakis, who has burdened most of the work, and who had also made an important contribution to the Scientific Program. I should like to thank Dimitris Mylonakis and his other collaborators, especially Ms. Ioanna Iotopoulou, who was extremely helpful, whenever we had to contact her. Crete, in Homer, in the Odyssey, is a particularly rich country (the Iliad calls it hekat—mpolis – with a hundred towns) where the nobles of a sea-faring people reside and display extraordinary hospitality. This is what we experience here.

The program includes an excursion to the Palace of Knossos, prior to our conference dinner on Saturday. We hope that you will pardon us for having included this element of tourism amidst our scientific activities. The Minoan and Mycenaean culture is the ancestor of classical Greece where in turn European society began – hence the Drachma coin with the owl as our symbol. A joint pilgrimage to these origins may be appropriate. As a consequence, and because of large attendance, there are again many parallel sessions. We beg you to bear this gladly and to keep discipline in attending the sessions, to begin and to end punctually so as not to interfere with the other sessions, and chairpersons are kindly requested to enforce punctuality. Chairpersons are also encouraged to help with the publication of the Proceedings of our conference by pointing out to the Scientific organisers which contributions might the suitable for inclusion, on the basis of their thematic orientation and their quality.

Contributors, on the other hand, are invited to send us their papers. The previous conference volumes have been successful and we hope that you will find it worthwhile to publish in our proceedings. Members of the Society can get previous conference volumes at a 50 % discount. The substance of history (and of the history of economic thought) necessarily is old, but the questions are modern. This time, we deal with “Development in the history of economic thought”, hence with a process which has been rapid, turbulent and characterised by quick ideological turns since the Second World War. For a while, it was dominated by the rivalry between capitalism and communism, and associated with it were the great hopes of decolonisation. More recently, we have witnessed the ascendancy of the Far Eastern countries, the downfall of the Soviet Union, the resurgence of Islam and the opening of China. Globalisation is accompanied by hopes for growth and by fears of excessive homogenisation and Westernisation.

I expect that Schumpeter’s phrase of creative destruction will often be quoted here. When I first visited Greece, about 45 years ago, as a boy, the donkey was still used to travel in the countryside and the Greeks seemed to sing, both at work, in the fields, when washing, and during leisure, when walking or dancing. When I came back in 1961, few would sing anymore. Instead, they were carrying transistor radios, and that was my first illustration of creative destruction and its ambivalence. Greece undoubtedly represents a remarkable example of post-war development, and to be able to pay in Euros is a confirmation that the development process is partly shaped by national traditions, partly determined by a world trend, but specifically modified by what happens in groups of countries which are similar in their cultural outlook, join forces and create common institutions. It will be a major benefit of our conference if it improves our understanding of such processes by improving our historical knowledge.

Here we come back to the specific contribution a European Society for the History of Economic Thought can make by rendering knowledge about specific national traditions international – something which requires to understand local languages and to express oneself internationally, which means English, for the most part. But I think that this process should not stop at the frontiers of Europe. The history of economic thought and of economic ideas concerns the world. The reasons why the West came to lead the process of development from the 16th century to today are in part rooted in its intellectual tradition, which started in Greece. This intellectual tradition, the creation of abstract economic thought, the singling out of the economy as a separate sphere in society, the formation of economic theories were a peculiar and historically important outcome, but other cultures came close to similar conceptions – even if at different levels of abstraction – and were perhaps more insightful in other respects. I am therefore both for and against Euro-centrism: for, because of the specificity of the European philosophical tradition, against, because it is one of our most challenging tasks to formulate and express in a language understandable to us what was different in what the others wanted.

If I may, I shall – for lack of time only by way of allusion – refer to my own recent work. The series “Klassiker der Nationalškonomie” will be completed this year, after the publication of 100 volumes of classical texts, each with a separate volume of commentaries. They range from Xenophon and Aristotle to Samuelson and von Neumann. However, we include also three non-European contributions: first Ibn Khaldun, to represent the Arabs. His theory of development, not only of growth, but also of decline, is very relevant to our conference theme, but his way of thought is not so different from ours because of the common Aristotelian origin. Then we have Miura Baien, with his Kagen (“on value”), sometimes called the Japanese Adam Smith. He wrote an economic treatise during the Tokugawa or Edo period when Japan was almost totally closed with respect to the outside world, in a process of autonomous preparation for a capitalist development, with feudal structures giving way to a penetration of market relations – the phenomena were similar to those described by Adam Smith when he talks of how towns developed the countryside. But Miura Baien’s representations of the phenomena are different, since they are based on the old Chinese Confucian tradition. At a time when banking, bills of exchange, centres of commercial activity originated in Japan in some analogy with Western developments, but essentially independent of them, Miura Baien asked himself how the ensuing threat to social cohesion might be faced, and to this end, he studied the Confucian classics, some 2200 years older, and tried to formulate a program between liberal reform and a conservative utopia. The concepts appropriate to describe this intellectual universe remain for us to be formulated in our language. Despite similarities, it will not do to speak of Japanese Physiocrats or Mercantilists.

Confucius wrote in the 6th century B.C. in a time of transition of Chinese feudalism to a more centralised form of state administration. Confucius writings emphasise loyalty, but also the duty of rulers who must provide for their subjects in times of need. As one saying went: if there is storage of grain for nine years, the state is wellordered. If there is storage for six years, the state is in danger. If there is storage for only three years, the state has ceased to exist. The figures are not to be taken literally but the message was of lasting importance. It did not simply mean insurance against risk, as when our Treasurer keeps funds, in case a future conference should fail like a bad harvest, but personal responsibility, upheld by virtue, and that is what Miura Baien emphasised when he realised that the rise of the monetary economy caused the feudal lords to spend the surplus for luxury consumption or monetary investments. The samurai continued to receive their stipends in the form of rice, and a future market developed for the harvests of coming years.

The workers migrated to the city where small industries developed. Miura Baien understood these trends and their causes, in particular monetary relations which were complicated because the monies of different princes, paper issued by commercial houses and other assets circulated simultaneously and coexisted with the payments in rice. These institutions were discussed as conscious creations, not as having emerged spontaneously. Even the first introduction of money in Japan in the 7th century A.D. was remembered as a historical event, i.e. as the deliberate imitation of the Chinese monetary system by the empress Genmei. She declared her wish thereby to lighten the burden of the Japanese people who would have to carry less in a mountainous country.

The Chinese literature on economic matters is far older and richer; its conceptual beginnings are roughly contemporaneous to the genesis of an economic discourse in European antiquity, but the perspectives are very different because of different social forms and a much closer identification of the political body with economic tasks. There is no Aristotelian theory of Chrematistics, of the autonomy of capital accumulation, but it is a recurring theme in China, throughout the millennia, that the state must provide granaries to help the peasants at the times of bad harvests; the European alternative of storage induced by changing market prices was not approved of. Our Chinese classic will be a text recording a discussion on the desirability of the salt and iron monopoly, held at the request of the emperor in the first century B.C. It contains deliberations on the tasks and instruments of bureaucratic rule, the virtues of organised agriculture and the benefits from controlled trade and effective taxation.

There is, in fact, in the Guan Zi, also the responsibility for creating employment, in the third century B.C., in a passage on funeral rites, where it is said that if the poor lack work, the burial of the king should be more luxurious, with a more expensive coffin, more gifts in the grave, a larger mound – obviously, Keynes had an insight into what others called ‘oriental despotism’, when he said that two pyramids for the dead are better than one.

This illustrates that the theme of our conference transcends the history of analytical economics. Mostly, of course, we shall be concerned with less exotic and more
theoretical conceptions of a more recent past.

It is now my duty and pleasure to introduce Robert Boyer. He disposes of a magnificent web site, with waving flags and a photograph of himself; it shows him sadly and pensively looking in front of a very cheerful Eastern deity. His researches are rich and extensive. He is best known for his contributions to the ThŽorie de la RŽgulation, for contributions on innovations, institutions and growth, international economics, but also the history of economic thought. His work has been studied by many others. Among his most recent contributions there is one to a book Institutional Economics in France and in Germany: German Ordo-Liberalism versus French Regulation School in which he gives both a summary and a development of the theory of the regulation school and provides a confrontation with Ordo-Liberalism and institutionalism – this I must praise because I have read it for a review. There are also several recent contributions on globalisation and RŽgulation. As a historian of economic thought, he has worked on authors such as Irving Fisher, Nicholas Kaldor, Keynes, Marx, Schumpeter, Smith, who are among the founders of what we have by way of a theory of development. We are therefore grateful that he has come to open our conference with the first plenary lecture.

Note: Robert Boyer’s Lecture is expected to appear in print in the forthcoming collection of papers from the Rethymno Conference under the editorship of G. Stathakis and G. Vaggi.