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A Historical and Methodological Study of Ends and Means in Economic Theory

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A Historical and Methodological Study of Ends and Means in Economic Theory Louisiana State University LSU Digital Commons LSU Historical Dissertations and Theses Graduate School 1979 A Historical and Methodological Study of Ends and Means in Economic Theory. Gerald Alonzo Smith Louisiana State University and Agricultural & Mechanical College Follow this and additional works at: https://digitalcommons.lsu.edu/gradschool_disstheses Recommended Citation Smith, Gerald Alonzo, "A Historical and Methodological Study of Ends and Means in Economic Theory." (1979). LSU Historical Dissertations and Theses. 3416. https://digitalcommons.lsu.edu/gradschool_disstheses/3416 This Dissertation is brought to you for free and open access by the Graduate School at LSU Digital Commons. It has been accepted for inclusion in LSU Historical Dissertations and Theses by an authorized administrator of LSU Digital Commons. For more information, please contact [email protected]. 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N /\ \ H H( >A| > ANN AHHf Ml \ > 1 <»> 1 hi ^ if ' 'Ml i M- !■■/,- 1 i - N ! n i * - l ■ / ; < U J. - U i 7 '4 i 7 S o * SMITH, bFrf*tr' 7. A HJST'WILAL ■'■; O r.iC il M 'M V nF A n 0 ■“ t ^ 5 I r C ■ . 1 r 'ff . Ry, THF L r'‘lM A <■■ i-. ■ T VF « I T v AM' A 0p 1C ■! 7 " ' v. ! 1 l-r ir;-L Pm.L,, i«7'J U ni\«rsity M ic ro film s Interrwional t(H) \ / i I 14 ■ i • 11* i A N N M i 4^'i i I It A HISTORICAL AND METHODOLOGICAL STUDY OF ENDS AND MEANS IN ECONOMIC THEORY A Dissertation Submitted to the Graduate Faculty of the Louisiana State University and Agricultural and Mechanical College in partial fulfillment of the requirements for the degree of Doctor of Philosophy in The Department of Economics by Gerald Alonzo Smith B.A., St. Louis University, 1960 M.S., University of Florida, 1971 August 1979 ACKNOWLEDGMENTS The author is happy to have this opportunity to thank Herman E. Daly. From the very beginning of my economic studies at the Louisiana State University to the last dot on this study he has provided valuable insights, much-needed encouragement» sound advice on how to proceed, and an understanding and kindness for which the author is most grateful. To Professors Robert A. Flammang, William F. Campbell, Stephen C. Farber, Frederic A. Youngs, Jr., for their guidance on this project, and on many others. To the many faculty members at LSU, especially in the Depart­ ment of Economics, who have aided me in many ways beyond the call of duty. The Rockefeller Brothers Fund aided in a financial manner much of this study, and its support is gratefully acknowledged. To Regina, my parents and her parents, for their support and encouragement during both the difficult and pleasant times that I have spent working on this study. TABLE OF CONTENTS Page • * ACKNOWLEDGEMENTS ..................... 11 TABLE OF C O N T E N T S ........................................ iii ABSTRACT .............................................. v CHAPTER I. INTRODUCTION................................... 1 FOOTNOTES......................................... 16 II. CONCERN FOR THE ENVIRONMENT (1800-1962).......... 19 Nineteenth-Century Concern for the Environment . 19 Thomas Robert Maithus William Stanley Jevons George Perkins Jevons Nathaniel Southgate Shaler Charles Van Hise Natural Resource Economic Theory of the First Conservation M o v e m e n t ................ 30 Lewis C. Gray Richard T. Ely John Ise and Frederick S o d d y ....................41 Subsequent Natural Resource Economics .......... 52 FOOTNOTES......................................... 57 III. THE TELEOLOGICAL FUNCTION OF ECONOMIC OUTPUT . 66 INTRODUCTION..................................... 66 J. C. L. Simonde de Sismondi......................81 John R u s k i n ..................................... 98 John A. Hobson.................................. 116 Richard Henry Tawney ........................... 127 G. K. Chesterton and the Distributists........... 140 FOOTNOTES........................................ 155 TABLE OF CONTENTS (Continued) Page CHAPTER IV. SIGNIFICANCE OF CAUSA MATERIAL IS AND CAUSA FINAL IS ............................ .172 FOOTNOTES ........................................ 210 BIBLIOGRAPHY.............................................. 216 VITA ...................................................... 231 iv ABSTRACT In his recent book The Steady-State Economy: The Economics of Biophysical Equilibrium and Moral Growth Herman E. Daly develops the concept of an ends-means spectrum and suggests that economic theory with its emphasis on economic growth has been both too materialistic and not materialistic enough.1 In ignoring the ultimate means and the laws of thermodynamics it has been insuf­ ficiently materialistic. In ignoring the Ultimate End and ethics it has been too materialistic. There are, however, impressive intellectual traditions that criticize economic theory with its emphasis on growth in production from each of these two perspec­ tives. Modem statements of these critical traditions are evident in current policy debates concerning economic growth, energy, the environment, etc. But the underlying issues are not new, and we can learn much from past thinkers who were perceptive enough to foresee the problems of a growth economy before they emerged in full bloom. The object of this dissertation is then twofold. First, it attempts an historical exposition of two traditions of economists. 1. Herman E. Daly, The Steady-State Economy: The Economics of Biophysical Equilibrium and Moral Growth (San Francisco: W. H. freeman 5 Co., 1977): lS-26. v The first tradition has been labeled neo-malthusian and includes those economists and other scholars who because of their belief that natural resources are a unique and essential factor of production in the economic process have explicitly incorporated the biophysical environment into their economic analysis. The second tradition in­ cludes those economists who would attempt to evaluate the worth of the output of the economic system by a more ultimate goal than that used by most economists (i.e., the satisfaction of '’given'* wants). This second tradition would hold that the existence of this ulti­ mate goal and a partial description of it can be derived from a study of man’s human nature. Second, the concluding portion of this study will attempt to show the methodological importance of what an acceptance of these two traditions would be for conventional economic theory. Building upon an Aristotelian epistemological foundation, the conclusion will argue for an holistic methodology which explicitly incorporates into economic analysis a consideration of the biophysical environment and the Ultimate End of man’s nature. It should be emphasized that this concluding portion will be tentative and suggestive in nature. vi CHAPTER I INTRODUCTION In his recent book The Steady-State Economy: The Economics of Biophysical Equilibrium and Moral Growth Herman E. Daly develops the concept of an ends-means spectrum and suggests that economic theory with its emphasis on economic growth has been both too materialistic and not materialistic enough.* In ignoring the ultimate means and the laws of thermodynamics it has been insuf­ ficiently materialistic. In ignoring the Ultimate End and ethics it has been too materialistic. There are, however, impressive intellectual traditions that criticize economic theory with its emphasis on growth in production from each of these two perspec­ tives. Modem statements of these critical traditions are evident in current policy debates concerning economic growth, energy, the environment, etc. But the underlying issues are not new, and we can learn much from past thinkers who were perceptive enough to foresee the problems of a growth economy before they emerged in
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