Jevons learns to economise

According to The Stanford Encyclopedia of Philosophy, the Ancient Greek philosopher Aristotle’s word for politics is politikê, which is short for politikê epistêmê – or political science.

The encyclopedia, published by California’s Stanford University, explains that Aristotle (384–322 BCE), who studied under Plato and later tutored Alexander the Great, ranked politics as one of the three main branches of science, which are “distinguished by their ends or objects”.

“Contemplative science (including physics and metaphysics) is concerned with truth or knowledge for its own sake; practical science with good action; and productive science with making useful or beautiful objects.”

The encyclopedia says politics is a practical science, “concerned with the noble action or happiness of the citizens (although it resembles a productive science in that it seeks to create, preserve, and reform political systems). Aristotle thus understands politics as a normative or prescriptive discipline rather than as a purely empirical or descriptive inquiry.”

It bears remembering that in the time of Newton, Leibniz, Boyle and the founding of the Royal Society of London in 1660, much of what we think of as science today was called natural philosophy.

Gary Miller, in his 1997 paper “The Impact of Economics on Contemporary Political Science”, published in the Journal of Economic Literature, says that from Scottish economist Adam Smith’s landmark 1776 book, An Inquiry into the Nature and Causes of the Wealth of Nations, until the middle of the 19th century, “leading social thinkers made little distinction between economic and political writing”.

Miller, an emeritus professor of political science at Washington University in St Louis, Missouri, says the methods of analysis were “similar, using largely verbal arguments dominated by normative concerns”.

All that changed, Miller says, when in 1871 William Stanley Jevons published his book, The Theory of Political Economy.

Jevons was already “a minor celebrity”, says David Owen, writing in The New Yorker magazine in 2010, for his 1865 book The Coal Question. In it, Jevons claimed that the booming economy and position of global power being enjoyed by Britain at the time couldn’t last, based as it was on a “rapidly depleting” domestic supply of coal.

Owen says Jevons believed “such an outcome could not be delayed through increased economy in the use of coal – what we refer to today as energy efficiency”. Owen cites Jevons’ claim that: “It is wholly a confusion of ideas to suppose that the economical use of fuel is equivalent to a diminished consumption. The very contrary is the truth.”

Jevons was born in Liverpool, England, on 1 September 1835. He attended University College from 1851 to study chemistry, mathematics and logic, but left without taking a degree, instead moving to Sydney, Australia, in 1854 to take a well-paying job as a metallurgical assayer at the new Australian Mint, where he determined characteristics such as weight, measure and quality of the coinage.

An article published by the University of St Andrews School of Mathematics and Statistics in Scotland says that while Jevons was in Australia, he took up studies in topics such as meteorology, geology, railway policy and political economy.

He went home to England in 1859, returning to University College and receiving a Master of Arts degree in 1862, with studies that included logic, moral and political philosophy, and political economy. This led to work as a lecturer in political economy and logic at Owens College, in Manchester. In 1876 he took up a chair at University College.

The St Andrews article describes a letter Jevons wrote to his brother in 1860, saying that he had recently found: “…what I have no doubt is the true theory of economy, so thorough-going and consistent, that I cannot read other books on the subject without indignation”.

In the introduction to a 2013 reprint of the Theory’s fourth edition, London School of Economics researcher Harro Maas calls Jevons “unquestionably one of the great minds in the history of economics”, and says he is “remembered as one of the ‘fathers’ of the so-called marginalist revolution in economics”.

Jevons, writes Mass, “never considered himself a mathematician (and was not considered so during his lifetime)”, and that his “forte was in chemistry and the experimental sciences”. He says the Theory “replaced the central problems addressed by classical political economists, dynamic questions of long-term growth and distribution, for that of price formation on markets”.

Mass says Jevons formulated the central problem of economics differently: “as a static optimisation problem – how to maximise overall utility given a certain amount of means of production”.

The Stanford Encyclopedia of Philosophy says that although Jevons’ writings on logic were widely used as textbooks, his “most important achievement [was] the introduction of statistics and econometrics in the social sciences and the use of empirical data”.

It says his writings “revolutionised economic theory and shifted classical to neoclassical economics. He was the first economist to construct index numbers, and he had a tremendous influence on the development of empirical methods and the use of statistics and econometrics in the social sciences.”

Jevons died on 13 August 1882; he drowned in an accident near Hastings, East Sussex.