Thursday, August 11, 2016
Richard Cantillon, Father of Modern Economics by Henry Higgs 1892
Richard Cantillon, Father of Modern Economics by Henry Higgs 1892
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Stimulated in part by the conscious recognition of the principle of evolution, the rapidly extending interest in the earlier economic writers is certain to be further developed by reprints like those of the hitherto hardly accessible Essai of Cantillon. An appetite for such literature rarely fails to grow by what it feeds on. The moment, moreover, is propitious for the revival of these old works. On the one hand, M'Culloch's reprints are themselves become "scarce and valuable" in the book market, as they were probably intended to be. And, on the other, the student of economics is no longer content to begin his history of theory with Adam Smith, but is fain to hope for a more intelligent appreciation of the Wealth of Nations, when he is aware of the relation which much of it bears to what had already been written by others.
Among these others, a place of high honor is due to Cantillon. He shares, with Adam Smith, Steuart, Mirabeau, Quesnay, Petty, Montchretien, Serra, Sully, the dignity of a reputed paternity of economics; and good reasons might be given for regarding him as "the father of Political Economy," without putting any very strained interpretation upon the phrase. But it is quite hazardous enough to make even the limited assertion that a writer is the first to offer a certain characteristic or to formulate a certain theory,— statements based rather upon what we do not know than upon what we do. Looking rather at economics as a stream issuing into light from sources veiled by the mists of antiquity, we may regard Cantillon as an early and important tributary, and consider (I.) the influences which affected him, (II.) the nature of his own contribution to the main stream, and (III.) the turn which he gave to other and later currents of economic doctrine.
As regards Cantillon's originality, it is impossible that he can have owed anything to works written later than 1734; for in that year he died. And a reference to the year 1730 at page 364 of the Essai justifies us in assuming, when allowance has been made for the time spent in translation, that the book was not finished long before his death. What, then, were the influences which bore upon him? The authors whom he names are Cicero, Livy, the two Plinys, Petty, D'Avenant, Locke, Halley, King, Newton, Vauban, and Boizard. He refers also to the author of an Etat de la France, probably Boulainvilliers, to the book of Genesis, and to the casuist writers on Usury.
One extrinsic piece of evidence enables us not only to name two other works with which he was acquainted, but comes nearer than any statement yet published to confirm the ascription of the Essai to Richard Cantillon. The necessity of explaining in a law-suit the distinction between usury and a profit made by foreign exchanges at current market rates induced Cantillon, as he tells a friend in a letter, to draw up a memoir on the subject for his advocate. Such a memoir is embodied in the "case"
preserved in the Bibliotheque Nationale in Paris, in the suit of Carol versus Richard Cantillon (Fm 2740). It is evidently from the hand of the author of the Essai, exhibits lucidly the nature of the exchanges in almost the same words, and appeals for confirmation to Dupuy's Traite de l'art des Lettres de Change, Savary's Parfait Negociant, "and all the authors who have treated of this subject." This mode of lumping writers together, with the easy confidence of a man who has read them all, is, it may be remarked, quite characteristic of Cantillon. Compare, for instance, his mention of Petty, Locke, and D'Avenant, "and all the other English authors who have written anything on this subject." On the other hand, it is inexplicable that a man much interested in the literature of his subject should go back to "a little manuscript of the year 1685" for a statement of Petty's which was printed in his Political Anatomy of Ireland in 1691, at p. 63. This, too, is the more remarkable because Petty was the one writer more than any other whose influence is conspicuous in the Essai. A certain familiarity with the Latin writers, suggested in various parts of the book, is borne out by Mirabeau's graphic description of Cantillon in his dressing-gown, discoursing upon the Livy which lay upon his desk.
It is possible, as Jevons suggests, that he had some acquaintance with Aristotle; but of this there is no proof. Such Aristotelian distinctions as "natural" and "artificial" wealth (a distinction, by the way, which Cantillon does not employ) were constantly used by seventeenth century writers like Mun, Lewes Roberts, Fortrey, Barbon, and D'Avenant, without being consciously borrowed from the Greek. And the opposition of le fonds et la forme, an old colloquialism still constantly heard in France, came, there is reason to think, from the formal language of the old French law, and not from Aristotle direct. Allowing, indeed, for literary influences in the air,— the spirit of the age,— we may account as well for an Aristotelian as, in a few scattered phrases here and there, for a certain Machiavellian ring.
But, if we do not find in Cantillon that fulness of reading which is shown by Adam Smith even oftener than his acknowledgments allow, we know that he was prepared for his task by two excellent teachers, Travel and Trade. Of these formative influences, the first operated, with few exceptions, upon all the ablest of the old English economists,— upon Mun, Petty, Locke, North, Barbon, Law, and the rest,— enlarging their horizon much as in modern times travel through time by the aid of history has widened the view of economists in Germany and elsewhere. Thus, too, in his recent inspection of a portion of the library of Adam Smith, who, we know, spent three years abroad, Professor Nicholson was much struck by the large number of books of travel. Cantillon, according to Mirabeau, "had houses in seven of the principal towns of Europe, and the slightest point of information to acquire or calculation to verify made him cross Europe from one end to the other." Such cosmopolitan experience must have greatly assisted an economist in the infancy of the science to winnow the local, accidental, and particular from the general and "natural" causes of wealth, even if it did not afford the advantage of access to the literature of trade in other tongues than his own. And Cantillon was an observant traveller. "In these travels," says Mirabeau, "he reduced everything to precision, got down from his carriage to go and question a laborer in his field, weighed the quality of the soil, tried the taste of it, made his notes, and a clerk, whom he always took with him, drew up the whole account at home in the evening." The countries to which Cantillon refers are England, France, Germany, Belgium, Holland, Sweden, Spain, Portugal, Italy, Hungary, Turkey, Greece, Poland, Russia, Cyprus, Arabia, China, Japan, India, Brazil, and America; and his references are often intimate as they are always apt.
A close connection with trade was equally fortunate in the case of a man with Cantillon's faculty for abstract reasoning. A banker, conversant by practice with the movements of commerce and the exchanges, he was admirably situated for a study of the great economic forces which swayed society in its diverse and seemingly eccentric movements. It was by the aid of qualities which enabled him to see the principles and workings of these elemental powers that, like Ricardo in later years, he succeeded in the money market. He had probably, too, some experience in the silk trade, possibly even in the wine trade. From these three forms of business activity his examples are chiefly drawn; though this may be little to the purpose in conjecturing his biography, for we know that Ricardo, let us say, was not a hatter, fond as he was of quoting hats as an example. Cantillon shows no such poverty of illustration. He is always ready to support an argument by a cogent fact, in this respect resembling Adam Smith as closely as in his laconic style he differs from him widely.
Whether or not Cantillon was a great reader, Mirabeau tells us that he wrote a great quantity of valuable works which perished with him. The standard of Mirabeau was
high in this respect, his own scribbling activity almost justifying his boast, "Had my hand been of bronze, it were long since worn out!" But there is little in Cantillon which the present writer can identify as derived from his predecessors, to none of whom, indeed, does he exhibit a very reverential attitude. The remarks upon the advantages of money hic et nunc over other commodities (pp. 252, 310) at once call up to the mind the words of Petty upon the same subject (e.g., Political Arithmetick, ed. 1691, pp. 18, 19, 36); though comparison shows the great advance which Cantillon made upon Petty's argument, and the subtlety of his additions to it (pp. 249-252). So, too, the alleged excessive number of priests and of holidays in Catholic countries (p. 125) is reminiscent of Petty's Political Anatomy of Ireland, 1691, where he recommends at p. 130 "that the exorbitant Number of Popish-priests and Fryars may be reduced to a bare competency," and says (p. 118), "The Irish Papists (besides Sundays and the 29 Holidays appointed by the Law) do . . . observe about 24 days more in the Year ... so as they have but about 266 working days; whereas Protestants have in effect 300 working days,— that is 34 days more than the Papists, or 1/10 part of the whole year." But Law's writings are not even mentioned by Cantillon, although his "System" is referred to in the Essai; and, although the distinction between "value in use" and "value in exchange," with the examples of water and diamonds, which opens the treatise on Money and Trade, was considered important enough by Adam Smith to be transferred to the pages of The Wealth of Nations (Book I. Chap. IV.). The title Essai sur la Nature du Commerce en General may be compared with the first page of Defoe's Plan of the English Commerce, 1728 (2d edition, 1730): "Of Trade in General, Chap. I When 'tis particular to a Place, 'tis Trade; when general, 'tis Commerce; when we speak of it as the Effect of Nature, 'tis Product or Produce; when as the Effect of Labour, 'tis Manufacture." The word "Nature" in the title is used with intention. "Natural" and "naturally" occur thirty times or more in the course of the short Essai; and we have only to think of the titles and the language of Graunt's Natural and Political Observations, or Adam Smith's Inquiry into the Nature and Causes of the Wealth of Nations, to recognize that in this respect Cantillon was not singular. But his use of "natural" is eminently scientific, and does not cover a confusion of thought or serve as a mere rhetorical trick, as often in the hands of other writers. It stands in the Essai for the inevitable sequence of effect upon cause, none the less existent because it may in practice be overborne by other forces. A clear conception of his title is necessary because he frequently cuts short a seductive line of inquiry by the remark, "But this is no part of my subject."
We thus come to consider the character and qualities of the Essai itself. To the present writer it appears very effectually to "isolate the conception of material wealth," which is often regarded as the distinctive originality of Adam Smith, and to differ from any preceding work of the kind in thoroughness and system, and especially in the unity which it derives from its backbone of a theory of value. Its piercing analysis is of such scientific generality that, had it been written in Latin by an author unknown, doubt might still prevail as to his nationality. This is true to some extent of two other able books, the Discourses upon Trade of Sir Dudley North, 1691, and Barbon's Discourse of Trade, 1690; but the latter is not without a vein of discursive philosophy, and, shorn of digressions, is not much more considerable in development than the outline which makes up the former, while neither Barbon nor North affects to treat of wages. North has, indeed, been the subject of unbounded eulogy by those who regard free trade as coincident with economic science, and has been called by M'Culloch "an Achilles without a heel"; but, in truth, his order of intellect, as manifested in this tract, bears about the same relation to that of Cantillon as the writings of Bastiat bear to those of Cournot. And, if we wish to find the first advocate of free trade, we must go much further back than two centuries ago.
The proposition with which Cantillon opens his Essai, that man and matter or land and labor are the agents of production, is a commonplace of old economics, such as Graunt had represented by the jingle "hands and lands." But it is necessary to emphasize the fact that Cantillon holds tightly to this principle throughout, because the authority of Daire has been lent to the opinion that the phrase in the Maximes Generales of Quesnay, "La terre est l'unique source des richesses," is due to the influence of Cantillon. It is not surprising that, after accepting this view, Jevons should write: "Quesnay . . . attributed undue weight to some . . . remarks of Cantillon, and produced an entirely one-sided system of economics, depending on land alone. Smith struck off rather on the other track, and took 'the annual labor of every nation' as the fund which supplies it with all the necessaries and conveniences of life." But we have no direct evidence that in either of these cases Cantillon is responsible for the faults of others; and, apart from the antecedent improbability of a borrowing which is really a rejection of his view, it is easier to match both these dicta more closely by references to other writers. Thus Colmeiro, Biblioteca de los Economistas Espanolas, quotes Centani (c. 1650) as saying, "La tierra es la unica y fisica hacienda"(wealth). And Locke and Galiani anticipated Adam Smith in the point under consideration.
When Cantillon passes from the causes to the measure of wealth, he acknowledges the influence of Petty, and again has recourse to land and labor, which he attempts to reduce to a par or equation, in order that wealth may be evaluated in terms of one of these two components. Petty's large experience as a land surveyor must, however, have convinced him of the great practical difficulty of taking any of the various and variable kinds of land as a general measure of value. He shows, therefore, a preference for "drudging labor," or rather its remuneration, for this purpose: "The day's food of an adult man at a medium, and not the day's labor, is the common measure of Value, and seems to be as regular and constant as the value of fine Silver" (Political Anatomy of Ireland, 1691, p. 65). "We understand the easiest gotten food of the respective Countries of the World, . . . what all Sorts and Sizes will eat, so as to Live, Labour, and Generate" (p. 64). Petty further mentions certain articles of food as equivalent,— e.g., a pint of oatmeal, a half-pint of rice, a quart of milk, a pound of bread, a pound and a quarter of "flesch,"— and goes on to give a very interesting account of the food, clothing, and housing of the poorer families in Ireland, and the average cost of the separate articles consumed (pp. 75-77, 81, 82). Now, Cantillon, as we know, bettered this instruction. It appears, from pages 48-51 of the Essai, that the missing Supplement contained statistics of the annual cost of living (food, clothing, etc.), of the peasant in the different countries of "our Europe," and exhibited great variations of diet, fashion, and expense. Even the subsistence of the Iroquois hunter and of the Southern Chinaman was compared with that of peasants in the county of Middlesex and in the south of France. Such a collocation evidently convinced Cantillon that the real wages of Labor do not constitute a good measure of value. He accordingly falls back upon land, his other alternative, but significantly concludes, in italics, "Money which, in exchange, finds the proportions of values, is the most certain measure for judging of the Par between Land and Labour, and the relation of one to the other in the different countries where this Par varies with the amount of Produce of Land attributed to those who work" (p. 54). But the curious italicizing on page 44 of a passage which seems to be an interpolation raises a question whether this, the only other italicized sentence in the book, is not inserted by some other hand. At any rate, his subsequent practice is not consistent. He sometimes estimates value in ounces of silver, sometimes in the product of so many acres of land "of average European goodness."
One conspicuous service of Cantillon to science is indicated by the necessity under which he lay to invent a phrase for what has since been called Normal Value. This real or intrinsic value, as he styled it is opposed to market value, precisely as natural and market value are contrasted by Adam Smith and Ricardo, or normal and market value by Cairnes and Marshall. The first Cantillon rested upon cost of production, or "quantity of land and labor which enters into its production, regard being had to the goodness or product of the land, and to the quality of the labor" (p. 36). The second depends upon supply and demand, "is sometimes above, sometimes below, Intrinsic Value, and varies with abundance or scarcity according to the consumption" (p. 128).
Such a conception of intrinsic value, imperfect as we may think it, was a striking feat of the imagination early in the eighteenth century, when the free play of "natural liberty" had not yet facilitated economic speculation by the simplification of hypothesis. The forces modifying at every step the production, distribution, and consumption of wealth, were so numerous, complicated, and capricious that an analysis of "tendencies" must have appeared to many minds neither practicable nor useful. But, in discussing the relative value of coin and bullion, Cantillon appeals to "the long run" with a quite Ricardian confidence; and he will admit of no exceptions to his theory of value, though it is noteworthy that he always applies it with careful regard to the effects of other factors of which he was a keen observer. Such factors, e.g., are space, time, and custom.
The English economist, living in a country whose physical features are on so small a scale and whose soil is so thickly populated, has been peculiarly liable to omit from view the economic results of distance from work or distance from a market, and this in spite of the exceptional importance attached to the subject by Adam Smith. But any one who has climbed the arduous approaches to the mountain villages among the olive groves of Northern Italy can hardly refuse his sympathy to Cantillon's a priori account of the "natural" formation of villages, due to the necessity of proximity to work. Readers of the Essai will not need to be reminded of the observations upon the marketing of perishable commodities, like fruit, vegetables, and fresh eggs, or heavy commodities, like timber, or wines coming to Paris from the south of France by way of Gibraltar, or bullion from Japan. Compare, too, his extension of Locke's Theory of Value so as to include under the term "market" other and distant places, so far as supply and demand there affect the particular place in question.
The reprint happily makes it unnecessary to quote the Essai at length. It is sufficient to instance the examples of the villagers who lose their time in going to and returning from another place, for want of a local tradesman; of the artisan whose wages are higher by reason of the time spent in apprenticeship; of the rapidity of circulation of the currency, and the proportion of bank reserves as related to the monetary habits of different classes of the community; and of custom in regard to consumption, of. fashion among the rich (e.g., pp. 82-84, 314), and the standard of comfort among the poor (p. 45).
It might, no doubt, be urged on behalf of economists who have accepted too literally the sublime exhortation of Carlyle to "sweep away the illusion of Time!" (and the rest), that by eliminating disturbing elements they have purified theory. Nor will it be denied that the competitive theory is a valuable tool, whose use is the distinctive feature of the trained economist. But the practice of suppressing reference to the disturbing elements is giving place to their careful enumeration and estimation, although the progress of society has in some respects considerably diminished the obstacles to unrestricted competition since Cantillon's time. So far, his book is much more likely to be appreciated now than it would have been some years ago. And, if the times were not yet ripe for a hypothesis of pure competition, he attained scientific exactitude by the ingenious device since used by Cournot of starting from monopoly (pp. 76, 131) and working down to something like the conditions of real life. Of a piece with this procedure is his method of approaching the wages question in Part I. Chap. XI. Beginning with slave labor, he shows that an adult unskilled slave must have allotted to him enough produce for his own maintenance and for that of a family sufficiently large to replace him as a laborer, regard being had to the rate of mortality. The skilled slave will receive more, because it pays to take more care of him as a more valuable chattel. The overseers will be distinguished "by advantages proportioned to the confidence and authority which they possess." Now, "if the proprietor employ vassals or free peasants to do his work, he will probably keep them a little better than he would keep slaves, to an extent determined by the custom of the country." Here Cantillon anticipates the necessary wages of the "iron law," and includes the important corrective or explanation of the effect of the standard of comfort.
Many points of great interest might further be mentioned with regard to his theory of value. But it is needless to extend these random references to the contents of the Essai. In originating even so much, Cantillon derived, as he complains, little help from his English predecessors, whom he accuses of attending, "not to causes and principles, but only to effects." It is idle to speculate whether this taunt can have fired Adam Smith to undertake his inquiry into the nature and causes of wealth; but it shows us Cantillon's own intentions, and to these he confined himself strictly. His arguments might often with advantage be expanded and his suggestions worked out, but there is no irrelevance, no prolixity. "He knows so well," says Mirabeau, "whence he starts and whither he goes!" And so, as Roscher has stated, he exhibits in great fulness many of the leading features and merits of later writers. His was, in truth, a master mind. He dared to argue with Newton, and did not get the worst of the argument. And he mentions Locke's views, generally to improve upon them and accept them "with a difference." He did not, of course, shake himself entirely free from contemporary prejudices. His suspicious anxiety for what may be called a balance of nutrition in foreign trade smacks of mercantilism in its latest phases, and is of a piece with earlier doctrine. "People and Plenty," wrote Fortrey in England's Interest and Improvement, 1663, "are commonly the begetters the one of the other, if rightly ordered,"—a phrase curiously re-echoed in the still unpublished article, Hommes, of Quesnay. And the author of Britannia Languens, 1680, devotes a section of his work to show that "People and Treasure are the Pillars of a Nation." The wonderfully good chapter on Population redeems Cantillon, however, from any charge of believing that wealth necessarily followed upon population. Moreover, if his environment betrayed him into weakness, it also saved him from some of the pitfalls of later writers,— as, for example, from airy assumptions about the equality of profits through the "migration of capital." After conducting us, with many concrete explanations, through the decline and fall of a tradesman's business, he brings us up with his usual formula, that "he will cease to carry it on or become bankrupt,"— an alternative not much contemplated by the Ricardian school.
As regards the second and third parts of the Essai, it would be interesting to show the advance made by Cantillon upon Briscoe and Asgill, Locke and Law. There is some beautiful work in these parts, notably the study of the circumstances which stimulate or impede the circulation of money; but it needs not to be extracted. A quotation from Jevons is sufficient: "The second part ... is a complete little treatise on currency, probably more profound than anything of the same size since published on the subject. . . . Judged by the knowledge and experience of the time, the third part especially is almost beyond praise." This is the verdict of a master, and is thoroughly justified by the weight of evidence.
Before laying down the Essai, we must lament the disappearance of the statistical Supplement. But for the unhappy accident by which this part of Cantillon's work is lost to us, the development of economics might have been considerably modified. The author's recognition of the importance of demand and consumption is very striking, and must have been much re-enforced by the Supplement, judging from the glimpses which we get of it in the text. Adam Smith, who was one of Cantillon's readers, identified the production of wealth with the "annual produce of the land and labor of the country," and not with the yield of taxes to the national exchequer. But he did not carry forward the same view into the Consumption of Wealth, and concluded his book by considering merely "the expenses of the Sovereign or Commonwealth" and the means by which they are defrayed; while the expenses of social classes, at which Petty and Cantillon had worked, were left in the background. From this misfortune, the study of consumption is only just beginning to recover.
Lastly, in addition to his services in threshing out and applying a theory of cost value, and in discussing in so masterly a fashion the principles of currency, banking, credit, and foreign commerce, Cantillon deserves recognition for having, as an economist, so sharply dissociated himself from political issues. Not even the influence of Petty persuaded him to enter upon the subject of Taxation (see p. 210), though the effects of taxation upon commerce are by no means remote; and the veriest purist among economists does not hesitate to-day, with due circumspection, to include Taxation in his province. Nevertheless, the distinction of economics from politics is a great gain for both; and Cantillon acted as a useful pioneer when he drew his firm line between them.
In considering Cantillon's originality, it was necessary to compare his work with writings which had appeared
before his death in 1734. In examining his influence, however, we are confined to writers of a date not earlier than 1755, when the Essai was first published. The manuscript of the Essai certainly affected the Marquis of Mirabeau much earlier. But he retained the manuscript jealously in his possession for sixteen out of the twenty-one years following its author's death. He is, therefore, probably the only important exception to the statement that the influence of Cantillon was not felt until 1755. It is a remarkable testimony, not only to the scientific value of the Essai, but to the stagnation of economics during the period 1734-55, that no part of the work was invalidated by this lapse of time, except, perhaps, so far as the development of banking had shown some of Cantillon's fears of state chicanery to be groundless. Melon's Essai Politique sur le Commerce, 1734, Vanderlint's Money answers All Things, 1734, and Berkeley's Querist, 1735, are gauges of the then state of economics as represented by its ablest votaries. Yet in 1756 the exordium of Another Dissertation on the Mutual Support of Trade and Civil Liberty runs as follows: "The author of the Reflections upon Learning, complaining of the late wonderful enlargements of its Boundaries, with a kind of prophetic contempt, supposes it not impossible, but that in a short time the World may admit even Trade Papers within the circle of Science. The event is at length come to pass,"—the University of Cambridge, "the renowned Mother of Arts and Sciences," having proposed in 1755, under the patronage of Lord Townshend, a reward of twenty guineas for a Dissertation on the Mutual Support and Assistance of Trade and Civil Liberty.
The year 1755 was remarkable in social science for much more than Lord Townshend's patronage. The middle of the century witnessed an awakening of interest in economics. Reprints and translations were multiplied. The writings of Ustariz and Ulloa were translated from Spanish into French, and those of Ustariz into English also. Dangeul and Forbonnais began to write. In France the economists were stirring, and the Encyclopedie was preparing. Gournay and his disciples were translating Culpepper, Child, and Tucker into French. Indeed, the identity of the fictitious title-page of Cantillon's Essai (A Londres, chez Fletcher Gyles, dam Holborn., 1755), with that of Turgot's translation of Tucker's Questions Importantes sur le Commerce the same year, at first sight suggests the possibility that Cantillon was published by the Gournay school. But the slovenly inaccuracies of its grammar (e.g., le prix et valeur intrinseque) and the numerous misprints (e.g., un a un for un a mil at page 35) at once make this very doubtful. At Berlin [Paris] appeared an edition of Herbert's Essai sur la Police des Grains. In Scotland the Foulis press was reprinting old works like Mun's England's Treasure by Forraigne Trade and Gee's Trade and Navigation of Great Britain considered. In England the Statutes at Large concerning the Provision for the Poor were collected together and published. Tucker printed his incomplete Elements of Commerce and Theory of Taxes, and published his Reflections on the Expediency of opening the Trade to Turkey. Petty's Political Arithmetic and Douglass's Summary of the British Plantations in North America were reprinted in London. Hewitt's Treatise upon Money and Magens's Essay on Insurances and the English translation of his Universal Merchant bear nearly the same date. And the same year which saw the death of Montesquieu and the publication of Cantillon's Essai was marked by Adam Smith's accession to the chair of Moral Philosophy in the University of Glasgow. The era of economic activity then commencing was not allowed to die. A succession of numerous and able writers extends thence-forward to the appearance of The Wealth of Nations, which opens a new chapter in the history of economic science.
There can be little doubt that the elder Mirabeau at one time intended to touch up Cantillon's manuscript, which he possessed, and publish it as his own. But he abandoned this project for that of avowedly editing the Essai, with a copious commentary. The publication of the text in 1755 by another person brought about a new change of plan; and ultimately his commentary, completed and enlarged, was published in 1756, under the title of L'Ami des Hommes. This work, with its ingenious turns of expression, familiar style, and vein of science, had a great literary success, at the same time that it attracted the serious attention of so solid a critic as Quesnay. It was not only in a sense the offspring of Cantillon's Essai, but called attention to the Essai in terms of high praise, and so must have widely extended Cantillon's repute. It further laid the foundation of the friendship between Mirabeau and Quesnay which resulted in the school or "sect" of the Economistes. If Mirabeaus account of his first conversation with Quesnay be accurate, he represented himself to Quesnay as a disciple of Cantillon, and was told for his pains that his tutor was a fool if he had taught him such views as he held. This indicates that Quesnay was, as yet, only acquainted with the Essai at second hand. He quoted it, however, in 1757 in support of his "fundamental" principles in his article Grains in the Encyclopedie. Gournay, in particular, esteemed it highly. Turgot, Morellet, Condillac, Mably, Graslin, Savary, Graumann, and Adam Smith, among contemporary writers, mention it; Harris and Postlethwayt plagiarized it; and Sir James Steuart quotes from a mutilated English translation, The Analysis of Trade, by Philip Cantillon, 1759. These are distinguished pupils, and the obligations under which some of them lay to the Essai would have entitled it to the epigraph,—
"Hither, as to their fountain, other stars
Repair, and in their golden urns draw light."
The debt of Quesnay to Cantillon is not a borrowing of detail, but an influence of spirit. It was not upon questions of grande or petite culture, of oxen or horses, of productive or unproductive labor, that he found help in Cantillon, but in the scientific attitude which he adopted when he approached the Distribution of Wealth. This organization of principle, and analytical habit of mind characteristic of the Economistes, constituted their very real service to Adam Smith. It is probable that Quesnay deduced his produit net and formed the idea of his Tableau Oeconomique from Part I. Chap. XII. of Cantillon's book, in which case Cantillon is certainly the Father of Physiocracy. The famous L'Ami des Hommes, written under the circumstances already mentioned, of course shows the influence of Cantillon throughout; but in later years Mirabeau persuaded himself that Cantillon was an advocate of large populations as a source of wealth, and refers to him in his Philosophie Rurale with amusing pity, as a great genius who had not a good grasp of scientific principle. The attribute of Turgot is breadth, as that of Quesnay is depth. He had taken all learning to be his province, and read much, but quoted little. We know, however, from one of his letters that he accounted for the eclipse of Melon's reputation by the succession of such luminaries as Montesquieu, Hume, Cantillon, Quesnay, Gournay, thus placing Cantillon in the first rank. Condillac paid the Essai the flattering attention of modelling upon it his work Le Commerce et le Gouvernement, 1776, in which he gave the Essai great praise. Nor were the Economistes alone in this chorus of favor. Mably, the brother of Condillac, who proposed his "doubts" to the Economistes upon their Ordre Naturel, was equally eulogistic. Graslin, reputed (probably without foundation) to have attended Adam Smith's lectures at Glasgow, followed suit in his Essai analytique sur la Richesse, 1767 (p. 365). And Adam Smith himself, by his reference to Cantillon, has insured him, as Jevons says, "a kind of immortality," though an examination of page 49 of the Essai discredits the criticism which the reference contains. The philosopher, who had in his Moral Sentiments based virtue upon sympathy, showed little of that quality himself in stating the views of others.
To the passages collected by Jevons as examples of Cantillon's influence upon Adam Smith it would be easy to add others. But it must suffice to mention one; and this will serve to show the lengths to which a fanciful study of "influences" may carry us. The fifteenth chapter of Part I. will convince any one who reads it that the eleventh was not the only chapter studied by Adam Smith. Accordingly, we have in Book I. Chap. XI. Part I. of The Wealth of Nations the following words, evidently inspired by Cantillon's fuller statement on the subject: "Men, like all other animals, naturally multiply in proportion to the means of their subsistence." Now, this passage is said to have suggested to Malthus the idea of his Essay on Population; and Darwin was led by the study of the Essay on Population "to explain the origin of species by a generalization which Malthus had known and named, though he did not pursue it beyond man." We have thus a complete chain from Cantillon, through Adam Smith, Malthus, and Darwin, to the present day. Malthus was one of the few English economists who refused to accept Adam Smith's account of the French school, and studied their views for himself. Daire, indeed, thinks that Malthus approved what was fundamental in them. But there is nothing to show that he was acquainted with those parts of their writings in which Cantillon's principles of population were stated or referred to; and he probably never saw Cantillon's Essai itself.
Lastly, to turn from this superficial indication of the influence of the Essai, what are the reasons which account for its falling almost into oblivion for a century, to be now revived with fairer prospects of recognition? Its scarcity, its difficulty (due to a rare combination of brevity with nicety of argument), and its lack of polished style or literary graces must have gone far to prevent it from becoming popular. There is, however, another reason which, to the conscientious student of to-day, gives it a perennial charm. As already mentioned, it was equally welcomed by the Economistes and by their opponents; and, if its general acceptance is not encouraged, neither is it discouraged by any recommendation of "isms." But the economists who have made a sound in the world outside the narrow circle of scientific discrimination have been, not the giants of pure theory, but the advocates of some "system," actual or prospective,— the mercantile or the agricultural, the cosmopolitan or the national system, free trade or protection, individualism or socialism, State regulation or laissez-faire, bimetallism or monometallism, and the like. The neglect of Cournot, even among professed economists of to-day, is a case in point.
It is not to be expected that the general reader will ever interest himself in Cantillon. It is enough that the Essai is now put within the reach of those who have a care for the history of economic science, or who find originality stimulated by quitting now and then the groove of contemporary thought to converse with an able writer of an older age. The reprint of 1892, at any rate, realizes the author's possible hope that, in the modest phrase of Milton, he "might perhaps leave something so written to aftertimes as they should not willingly let it die."
See also http://tomwoods.com/podcast/ep-704-adam-smith-not-the-founder-of-economic-science/