He writes: "I have a question about the intellectual history of economics. (I'm a newbie trying to self-teach myself the discipline...so this might sound stupid). When did the market-based economy become the consensus for academic economists?
Socialism, Marxism, etc were ideologies
that held great sway among many great intellectuals for a long time. But
these folks appear to be mostly philosophers and sociologists and
various public intellectuals.
So, was there a time when
Keynesian and Classical economists stood tougher on one side of a
university's econ department and duked it out with the Socialists and
Marxists on the other? If so, when did this end."
My impression is that Marxism and socialism were fairly defunct even by the time Keynes came along, such that he could dismiss them unceremoniously and without a whole lot of analysis without anyone considering that particularly problematic. As Manju says, it seems to remain popular among non-economist intellectuals (and that continues to today), and some of their arguments were economic rather than simply social. But just because their arguments were economic doesn't mean that economists took them particularly seriously.
Still, one of my favorite Keynes smackdowns of Marxism is his1926 review of Trotsky's book Where is Britain Going?.This is my favorite part of that review (bolding is mine):
"But what are his assumptions? He assumes that the moral and
intellectual problems of the transformation of Society have been already
solved--that a plan exists, and that nothing remains except to put it
into operation. He assumes further that Society is divided into two
parts – the proletariat who are converted to the plan, and the rest who
for purely selfish reasons oppose it. He does not understand that no
plan could win until it had first convinced many people, and that, if
there really were a plan, it would draw support from many different
quarters. He is so much occupied with means that he forgets to tell us
what it is all for. If we pressed him, I suppose he would mention Marx.
And there we will leave him with an echo of his own words – “together
with theological literature, perhaps the most useless, and in any case
the most boring form of verbal creation.”
Trotsky’s book must confirm us in our conviction of the uselessness,
the empty-headedness of Force at the present stage of human affairs.
Force would settle nothing – no more in the Class War than in the Wars
of Nations or in the Wars of Religion. An understanding of the
historical process, to which Trotsky is so fond of appealing, declares
not for, but against, Force at this juncture of things. We lack more
than usual a coherent scheme of progress, a tangible ideal. All the
political parties alike have their origins in past ideas and not in new
ideas – and none more conspicuously so than the Marxists. It is not
necessary to debate the subtleties of what justifies a man in promoting
his gospel by force; for no one has a gospel. The next move is with the
head, and fists must wait."
Of course the Soviets had their own economists, and there was a mid-twentieth century of socialist calculation which was very important. In a lot of ways, though, this wasn't about Marxist economics at all. This was about neoclassical economics and whether the market could be reproduce under state socialism. Does that make sense? I simply mean that if Manju is looking for a critique of Marxist economic theory, the socialist calculation debate isn't really about that. If he is looking for an argument about whether socialism could work in practice, Marxist theory of the economy be damned, then that debate is worth looking at.
Bartleby does not like Marxist economics:
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