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- Title
The Empirical Content and Longevity of Ricardian Economics.
- Authors
de Marchi, N. B.
- Abstract
There is a generally recognized gap, though of uncertain width, between the abstract analytical propositions of Ricardian economics and the concrete truth implicit in their use by contemporaries as guides to legislative action. The first purpose of this paper is to inquire into the nature of the economic statements made by Ricardo, and by John Stuart Mill. Can their key propositions be construed as, and did they intend them to be, empirical statements? What tests did they accept to measure the "truth" of their theory? How did they bridge the gap between their abstractions and the real world? <BR> A second purpose, to which the first inquiry is a necessary preliminary, is to throw some light on a related historical issue of some importance. Mark Blaug has recently charged Mill with having given an artificial extension of life to the Ricardian system, after it had become empirically untenable. Blaug argues that "the body of doctrine which Ricardo bequeathed to his followers rested on a series of definite predictions about the course of economic events which were subject to empirical verification, in the strictest sense of the term". These predictions included "a rising price of corn, a rising share of the national income going to rent receivers, constant real wages, and a gradual vanishing of investment opportunities in industry". But statistical evidence, available in the 1830s and 1840s, falsified these predictions. At that stage, Blaug argues, the system was retained only because of its usefulness to the opponents of the Corn Laws. Still more, therefore, with the repeal of those laws in 1846, should the system have been rejected as obsolete. For then even its basic assumption--an "insulated" economy--was no longer realistic. Thus, in 1848 Mill revived a system which, it is claimed, had been falsified as to its key deductions, and rendered irrelevant by the attainment of its chief policy objective.[2].
- Subjects
EMPIRICISM; ECONOMIC policy; INDUSTRIAL relations; POPULATION &; economics; RICARDO, David, 1772-1823; MILL, John Stuart, 1806-1873; ECONOMICS
- Publication
Economica, 1970, Vol 37, Issue 147, p257
- ISSN
0013-0427
- Publication type
Article
- DOI
10.2307/2551973