Thomas C. Leonard

AN ECONOMIC THEORY OF CIGARETTE ADDICTION

In this paper we present a model in which individuals act in their own best interest, to explain many behaviors associated with cigarette addiction. There are two key features of the model. First, there is an explicit representation of the withdrawal effects experienced when smokers attempt to quit smoking. Second, there is explicit recognition that the negative effects of smoking generally appear late in an individuals life. Among the things we use the model to explain are: (1) how individuals can become trapped in their decision to smoke; (2) the conditions under which cold-turkey quitting and gradual quitting may occur; and (3) a reason for the existence of quit-smoking treatments.

Retrospectives: Eugenics and Economics in the Progressive Era

During the Progressive Era, eugenic approaches to social and economic reform were popular, respectable and widespread. This essay documents the influence of eugenic ideas upon American economic reform, especially in the areas of immigration and labor reform, and tries to illuminate something of its causes and consequences.

“More Merciful and Not Less Effective”: Eugenics and American Economics in the Progressive Era

Oliver Wendell Holmes was made a Progressive lion upon his pithy dissent to the U.S. Supreme Court’s landmark decision to overturn a New York statute restricting (male) bakers’working hours. “The 14thAmendment,” said Holmes famously, “does not enact the Social Statics of Mr. Herbert Spencer.”1 Twenty-two years later, in another well-known case, Holmes wrote for the majority, which upheld the constitutionality of a Virginia law proposing involuntary sterilization of persons believed to be mentally retarded—the “feebleminded,” in the jargon of the day. “The principle that sustains compulsory vaccination is broad enough to cover cutting the Fallopian tubes,” Holmes wrote in Buck v. Bell (1927). “Three generations of imbeciles,” Holmes volunteered, “is enough.” How does an opponent of Spencerian Social Darwinism come to endorse coercive sterilization of the unfit? This essay argues that, as a matter of history, there is no contradiction in the views that underwrite the

American Economic Reform in the Progressive Era: Its Foundational Beliefs and Their Relation to Eugenics

This essay explores the progressive beliefs other than human hierarchy that inclined Progressive Era economic reform toward eugenics. It argues the following: that the progressives believed in a powerful, centralized state, conceiving of government as the best means for promoting the social good and rejecting the individualism of (classical) liberalism; that the progressives venerated social efficiency; that the progressives believed in the epistemic and moral authority of science, a belief that comprised their view that biology could explain and control human inheritance and that the still nascent sciences of society could explain and control the causes of economic ills; that the progressives believed that intellectuals should guide social and economic progress, a belief erected upon two subsidiary faiths, a faith in the disinterestedness and incorruptibility of the experts who would run the technocracy they envisioned, and a faith that expertise could not only serve the social good, but also identify it; and that, while antimonopoly, the progressives believed that increasing industrial consolidation was inevitable, and desirable, consistent with their faith in planning, organization, and command.

Reflection on rules in science: an invisible-hand perspective

Can successful science accommodate a realistic view of scientific motivation? The Received View in theory of science has a theory of scientific success but no theory of scientific motivation. Critical Science Studies has a theory of scientific motivation but denies any prospect for (epistemologically meaningful) scientific success. Neither can answer the question because both regard the question as immaterial. Arguing from the premise that an adequate theory of science needs both a theory of scientific motivation, and a theory of scientific success, I make a case for seeing science as a kind of invisible-hand process. After distinguishing different and often confused conceptions of invisible-hand processes, I focus on scientific rules, treated as emergent responses to various coordination failures in the production and distribution of reliable knowledge. Scientific rules, and the means for their enforcement, constitute the invisible-hand mechanism, so that scientific rules (sometimes) induce interested scientific actors with worldly goals to make epistemically good choices.

“A Certain Rude Honesty”: John Bates Clark as a Pioneering Neoclassical Economist

John Bates Clark (1847–1938), the most eminent American economist of a century ago, was, in his own day, caricatured as an apologist for laissez-faire capitalism (Veblen 1908).1 The caricature has shown staying power, a measure, perhaps, of the relative paucity of scholarship on Clark and his work. Recent Clark research signals a welcome attempt at a more accurate portrait (Morgan 1994; Henry 1995; Persky 2000). But some revisionists would remake Clark the apologist for capital into Clark the Progressive exemplar. Robert Prasch (1998, 2000), for example, depicts Clark as a Progressive paragon, which groups him with the great reformers of Progressive-Era political economy—Social Gospelers such as Richard T. Ely and his protege John R. Commons, labor legislation activists such as Clark’s junior colleague Henry Rogers Seager

New on Paternalism and Public Policy

Bill News (1999) thoughtful paper has performed the valuable service of clarifying the meaning and the policy implications of paternalism. His careful formulation delimits the domain of justified state paternalism. Having argued successfully, in our view, for a narrow ambit, New proceeds to identify situations that justify paternalism. This comment is written in the spirit of a friendly reformulation that refines and improves the specification of when paternalism is justified. Our argument is two-fold. First, we argue that News formulation, properly understood, will not readily permit the paternalistic interventions he argues are justified. Second, we identify a class of potentially justified interventions that have paternalistic aspects, but which are neither strictly paternalistic nor market-failure remedies.

INEQUALITY OF WHAT AMONG WHOM?: RIVAL CONCEPTIONS OF DISTRIBUTION IN THE 20TH CENTURY

Distribution concerns who gets what. But does “who” refer to the personal distribution of income among individuals or the functional distribution of income among suppliers of productive factors? For nearly 150 years, Anglophone distribution theory followed the Ricardian emphasis on functional distribution – the income shares of labor, land, and capital. Only beginning in the 1960s, and consolidated by a research outpouring in the early 1970s, does mainstream economics turn to the personal conception of distribution. This essay documents Anglophone (primarily American) economics’ move from functional to personal distribution, and tries to illuminate something of its causes and timing.

Economics at the millennium

History teaches that the future will be unkind to those foolhardy enough, or well compensated enough, to attempt prediction. The most eminent American economist of a century ago, Irving Fisher, predicted in October 1929 that “the end of the decline in the stock market will ... be a few more days at the most.” IBM chairman Thomas Watson estimated in 1943 that “there is a world market for about five computers.” Charles Duell, of the U.S. Patent Office, asserted in 1899 that “everything that can be invented has been invented.” In 1894, on the cusp of the golden age of physics, physicist A.A. Michelson concluded that “the more important fundamental laws and facts of physical science have all been discovered.” Economics also teaches skepticism about prediction—forecasts of any real value are unlikely to remain valuable for long. Still, the opportunity to speculate on the future of economics is irresistible, not least because any guess at the future must begin with the present, and with the history that brought us here. Jacob Viner once said, only partly tongue-incheek, that “economics is what economists do.” Economists today do many and diverse things. Testifying to this diversity, the New Palgrave Dictionary of Economics contains nearly two thousand essay-length entries. How economists do economics remains more monolithic. In this sense, neither of your correspondents is a representative economist. In a discipline that has adopted the techniques and ethos of applied mathematics, we mostly conduct our arguments in prose. Moreover, our research interests include the history and philosophy of economics, fields that today occupy the periphery of the discipline, so our views may not be representative. To partially compensate for these biases, we present views other than our own. This might also ECONOMICS AT THE MILLENNIUM

Progressive Era Origins of the Regulatory State and the Economist as Expert

During the long Progressive Era (1885–1918) progressive reformers transformed American government, American higher education, and American economics, all in the name of regulating a transformed economy. Economic progress, they argued successfully, required the creation of a powerful regulatory state, guided by expert economic advisers, whose scientific training and credentials were supplied by the nascent research universities. Progressive economists called this new model of economic governance social control. Social control was less a coherent agenda of substantive goals than it was a technocratic theory and practice of how best to obtain them—a progressive method of economic governance. Though American economics cast its vocational lot with the regulatory state, left and right progressive economists offered different visions of the states role in economic life—managerial and market capitalism, respectively—which arose from differing conceptions of how a modern, industrialized economy functioned, and which evolved with the shifting vocational opportunities presented by recurring crisis. Different visions of the states role in economic life, in turn, implied different conceptions of what economic experts do.