The Birmingham School was a school of economic thought that emerged in

Birmingham Birmingham ( ) is a city and metropolitan borough in the metropolitan county of West Midlands in England. It is the second-largest city in the United Kingdom with a population of 1.145 million in the city proper, 2.92 million in the We ...

England England is a country that is part of the United Kingdom. It shares land borders with Wales to its west and Scotland to its north. The Irish Sea lies northwest and the Celtic Sea to the southwest. It is separated from continental Europe ...

during the post-Napoleonic depression that affected England following the end of the

Napoleonic wars The Napoleonic Wars (1803–1815) were a series of major global conflicts pitting the French Empire and its allies, led by Napoleon I, against a fluctuating array of European states formed into various coalitions. It produced a period of Fre ...

in 1815.

Overview

Arguing an underconsumptionist theory – attributing the depression to the fall in demand due to the end of the wars and end of war mobilization – Birmingham School economists opposed the

gold standard A gold standard is a monetary system in which the standard economic unit of account is based on a fixed quantity of gold. The gold standard was the basis for the international monetary system from the 1870s to the early 1920s, and from th ...

and advocated the use of an expansionary monetary policy to achieve

full employment Full employment is a situation in which there is no cyclical or deficient-demand unemployment. Full employment does not entail the disappearance of all unemployment, as other kinds of unemployment, namely structural and frictional, may remain. F ...

. The leading thinker and spokesman for the Birmingham School was the banker Thomas Attwood. Other notable figures included

George Frederick Muntz George Frederick Muntz (26 November 1794 – 30 July 1857) was an industrialist from Birmingham, England and a Liberal Party Member of Parliament (MP) for the Birmingham constituency from 1840 until his death. His father Philip Frederic Mu ...

and Thomas Attwood's brother Matthias Attwood. Economists who lent the Birmingham School some support included Arthur Young, Patrick Colquhoun and Sir John Sinclair. Dismissed at the time as "currency cranks" or "crude inflationists", the theories of the Birmingham School are now recognized as embryonic versions of the

Keynesian economics Keynesian economics ( ; sometimes Keynesianism, named after British economist John Maynard Keynes) are the various macroeconomic theories and models of how aggregate demand (total spending in the economy) strongly influences economic output ...

of the 1930s. Some of Attwood's writings contain formulations of the multiplier effect and an income-expenditure model. In his 1954 ''History of Economic Analysis'', Joseph Schumpeter wrote that "it is from these writings that any study of modern ideas on monetary management ought to start".

References

Bibliography

* * * Miller, Henry. "Radicals, Tories or Monomaniacs? The Birmingham Currency Reformers in the House of Commons, 1832-67," ''Parliamentary History'' (2012) 31#3 pp 354–377. * * Schools of economic thought Keynesian economics History of Birmingham, West Midlands Full employment {{Econ-theory-stub

Overview

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Bibliography