John Bates Clark (January 26, 1847 – March 21, 1938) was an American
neoclassical economist
An economist is a professional and practitioner in the social sciences, social science discipline of economics.
The individual may also study, develop, and apply theories and concepts from economics and write about economic policy. Within this ...
. He was one of the pioneers of the
marginalist revolution
Marginalism is a theory of economics that attempts to explain the discrepancy in the value of goods and services by reference to their secondary, or marginal, utility. It states that the reason why the price of diamonds is higher than that of wa ...
and opponent to the
Institutionalist school of economics, and spent most of his career as
professor
Professor (commonly abbreviated as Prof.) is an Academy, academic rank at university, universities and other post-secondary education and research institutions in most countries. Literally, ''professor'' derives from Latin as a "person who pr ...
at
Columbia University
Columbia University (also known as Columbia, and officially as Columbia University in the City of New York) is a private research university in New York City. Established in 1754 as King's College on the grounds of Trinity Church in Manhatt ...
.
Biography
Clark was born and raised in
Providence, Rhode Island
Providence is the capital and most populous city of the U.S. state of Rhode Island. One of the oldest cities in New England, it was founded in 1636 by Roger Williams, a Reformed Baptist theologian and religious exile from the Massachusetts Bay ...
, and graduated from
Amherst College
Amherst College ( ) is a private liberal arts college in Amherst, Massachusetts. Founded in 1821 as an attempt to relocate Williams College by its then-president Zephaniah Swift Moore, Amherst is the third oldest institution of higher educatio ...
, in Massachusetts, at the age of 25. From 1872 to 1875, he attended the
University of Zurich
The University of Zürich (UZH, german: Universität Zürich) is a public research university located in the city of Zürich, Switzerland. It is the largest university in Switzerland, with its 28,000 enrolled students. It was founded in 1833 f ...
and the
University of Heidelberg
}
Heidelberg University, officially the Ruprecht Karl University of Heidelberg, (german: Ruprecht-Karls-Universität Heidelberg; la, Universitas Ruperto Carola Heidelbergensis) is a public research university in Heidelberg, Baden-Württemberg, ...
where he studied under
Karl Knies (a leader of the
German Historical School
:''This is an article about a school of thought in the area of law. For economics, see historical school of economics.''
The German Historical School of Jurisprudence is a 19th-century intellectual movement in the study of German law. With Romant ...
). He taught as a professor of economics at
Carleton College
Carleton College ( ) is a private liberal arts college in Northfield, Minnesota. Founded in 1866, it had 2,105 undergraduate students and 269 faculty members in fall 2016. The 200-acre main campus is between Northfield and the 800-acre Cowling ...
from 1875 to 1881 before moving east to teach at
Smith College
Smith College is a Private university, private Liberal arts colleges in the United States, liberal arts Women's colleges in the United States, women's college in Northampton, Massachusetts. It was chartered in 1871 by Sophia Smith (Smith College ...
. He subsequently taught at
Amherst College
Amherst College ( ) is a private liberal arts college in Amherst, Massachusetts. Founded in 1821 as an attempt to relocate Williams College by its then-president Zephaniah Swift Moore, Amherst is the third oldest institution of higher educatio ...
,
Johns Hopkins University
Johns Hopkins University (Johns Hopkins, Hopkins, or JHU) is a private university, private research university in Baltimore, Maryland. Founded in 1876, Johns Hopkins is the oldest research university in the United States and in the western hem ...
, and
Columbia University
Columbia University (also known as Columbia, and officially as Columbia University in the City of New York) is a private research university in New York City. Established in 1754 as King's College on the grounds of Trinity Church in Manhatt ...
. Early in his career Clark's writings reflected his German
Socialist
Socialism is a left-wing economic philosophy and movement encompassing a range of economic systems characterized by the dominance of social ownership of the means of production as opposed to private ownership. As a term, it describes the e ...
background and showed him as a critic of
capitalism
Capitalism is an economic system based on the private ownership of the means of production and their operation for Profit (economics), profit. Central characteristics of capitalism include capital accumulation, competitive markets, pric ...
. During his time as a professor at
Columbia University
Columbia University (also known as Columbia, and officially as Columbia University in the City of New York) is a private research university in New York City. Established in 1754 as King's College on the grounds of Trinity Church in Manhatt ...
however, his views gradually shifted to support of capitalism and he later became known as a leading advocate of the capitalist system.
Theoretical work
After his return, from 1877 onward, Clark published several articles most of them edited later in ''The Philosophy of Wealth'' (1886). There he formulated an original version of
marginal utility theory
In economics, utility is the satisfaction or benefit derived by consuming a product. The marginal utility of a good or service describes how much pleasure or satisfaction is gained by consumers as a result of the increase or decrease in consumpti ...
, principle already published by
Jevons (1871),
Menger (1871), and
Walras (1878).
Until 1886 Clark was a Christian socialist reflecting the view of his German teachers that competition is no universal remedy – especially not for fixing wages. Clark writes:
It is a dangerous mistake to extol competition, as such too highly, and regard all attacks upon it as revolutionary. … We do not eat men … but we do it by such indirect and refined methods that it does not generally occur to us that we are cannibals.
He hoped that communism could be combatted by suppression ''and'' reform:
Among the adherents of Communism there is a large element that is simply murderous, and this deserves only the murderer's fate. ... It is possible that an indefinitely large proportion of declared communists in this country may be of worthless or criminal character.
According to Clark only if "...the union of capital necessitates the union of labour" just wages will come about and may be fixed by arbitration.
This view on fair wages changed in 1886: "Clark himself, it will be remembered has song down the doom of competition in ''The Philosophy of Wealth''. But now … he has reversed his position and build
up a body of economic laws based on competition" writes Homan (1928) and Everett (1946) finds: "Soon after writing ''The Philosophy of Wealth'', however, Clark started to make defences for the competitive system. What caused the change is unknown. This much we can say. By the time he wrote The Distribution of Wealth he was convinced that pure competition was the natural and normal law by which the economic order obtained justice." One cause that prompted this reorientation could be the
Haymarket Riot
The Haymarket affair, also known as the Haymarket massacre, the Haymarket riot, the Haymarket Square riot, or the Haymarket Incident, was the aftermath of a bombing that took place at a labor demonstration on May 4, 1886, at Haymarket Square in ...
(1886) in Chicago when some strikers were shot and others hanged. In the US it resulted in a cleansing of higher education from ''socialist'' reformers and the ruin of the
Knights of Labor
Knights of Labor (K of L), officially Noble and Holy Order of the Knights of Labor, was an American labor federation active in the late 19th century, especially the 1880s. It operated in the United States as well in Canada, and had chapters also ...
.
In 1888 Clark wrote ''Capital and Its Earnings''.
Frank A. Fetter later reflected on Bates' motivation for writing this work:
The probable source from which immediate stimulation came to Clark was the contemporary single tax
A single tax is a system of taxation based mainly or exclusively on one tax, typically chosen for its special properties, often being a tax on land value. The idea of a single tax on land values was proposed independently by John Locke and Bar ...
discussion. ... Events were just at that time crowding each other fast in the single tax propaganda. Henry_George's_.html" ;"title="Henry_George.html" ;"title="Henry George">Henry George's ">Henry_George.html" ;"title="Henry George">Henry George's ''Progress and Poverty''... had a larger sale than any other book ever written by an American. ... No other economic subject at the time was comparable in importance in the public eye with the doctrine of ''Progress and Poverty''. ''Capital and its Earnings'' "... wears the mien of pure theory .... But ... one can hardly fail to see on almost every page the reflections of the contemporary single-tax discussion. In the brief preface is expressed the hope that 'it may be found that these principles settle questions of agrarian socialism
Agrarian socialism is a political ideology that promotes “the equal distribution of landed resources among collectivized peasant villages” This socialist system places agriculture at the center of the economy instead of the industrialization ...
.' Repeatedly the discussion turns to 'the capital that vests itself in land,'...
The foundation of Clark's further work was competition: "If nothing suppresses competition, progress will continue forever". Clark: "The science adapted … is economic Darwinism. … Though the process was savage, the outlook which it afforded was not wholly evil. The survival of crude strength was, in the long run, desirable". This was the fundament to develop the theory which made him famous: Given competition and homogeneous factors of production ''labor'' and ''capital'', the repartition of the social product will be according to the productivity of the last physical input of units of ''labor'' and ''capital''. This theorem is a cornerstone of neoclassical micro-economics. Clark stated it in 1891 and more elaborated 1899 in ''The Distribution of Wealth''. The same theorem was formulated later independently by
John Atkinson Hobson
John Atkinson Hobson (6 July 1858 – 1 April 1940) was an English economist and social scientist. Hobson is best known for his writing on imperialism, which influenced Vladimir Lenin, and his theory of underconsumption.
His principal and ea ...
(1891) and
Philip Wicksteed
Philip Henry Wicksteed (25 October 1844 – 18 March 1927) is known primarily as an economist. He was also a Georgist,
Unitarian theologian, classicist, medievalist, and literary critic.
Family background
He was the son of Charles Wicksteed ...
(1894). The political message of this theorem is: "
at a social class gets is, under natural law, what it contributes to the general output of industry."
Clark's conclusion rests upon the productive contribution of the last unit of physical labour – one hour unqualified labour – and the last unit of physical capital. To him heterogeneous capital goods have a second, a social form as homogeneous capital (called ''jelly'' as a street can be moulded into an engine) and the productivity of the last unit of ''jelly'' determines ''profit''. This retakes
Karl Marx
Karl Heinrich Marx (; 5 May 1818 – 14 March 1883) was a German philosopher, economist, historian, sociologist, political theorist, journalist, critic of political economy, and socialist revolutionary. His best-known titles are the 1848 ...
's view that commodities have a heterogeneous natural form (''Naturalform'') and also opposed to it a homogenous value-form (''Wertform''), ''jelly''. Clark might have known this Marxian construction from his German time and was reproached for this similarity.
Clark's capital are not ''produced means of production'' each with a different production structure. It is an abstract, always existing and never perishing ''one great tool in the hand of working humanity''
[Clark (1908), pp. 59–60.] similar to a field or a waterfall, also considered capital by Clark.
The arguable sides of Clark's notion of capital helped to give rise to the
Cambridge capital controversy
The Cambridge capital controversy, sometimes called "the capital controversy"Brems (1975) pp. 369-384 or "the two Cambridges debate", was a dispute between proponents of two differing theoretical and mathematical positions in economics that starte ...
from 1954 to 1965 between the departments of economics at
Cambridge University
, mottoeng = Literal: From here, light and sacred draughts.
Non literal: From this place, we gain enlightenment and precious knowledge.
, established =
, other_name = The Chancellor, Masters and Schola ...
, England, and at
MIT
The Massachusetts Institute of Technology (MIT) is a private land-grant research university in Cambridge, Massachusetts. Established in 1861, MIT has played a key role in the development of modern technology and science, and is one of the m ...
in
Cambridge
Cambridge ( ) is a university city and the county town in Cambridgeshire, England. It is located on the River Cam approximately north of London. As of the 2021 United Kingdom census, the population of Cambridge was 145,700. Cambridge bec ...
,
.
Paul A. Samuelson
Paul Anthony Samuelson (May 15, 1915 – December 13, 2009) was an American economist who was the first American to win the Nobel Memorial Prize in Economic Sciences. When awarding the prize in 1970, the Swedish Royal Academies stated that he "h ...
's classic 1947 textbook, ''Economics,'' disseminated Clark's concept of capital worldwide.
Clark was the father of economist
John Maurice Clark
John Maurice Clark (1884–1963) was an American economist whose work combined the rigor of traditional economic analysis with an "institutionalist" attitude. Clark was a pioneer in developing the notion of workable competition and the theore ...
.
Major works
* ''The Philosophy of Wealth: Economic Principles Newly Formulated'' (1886).
* ''Capital and Its Earnings'' (1888).
* ''The Distribution of Wealth: A Theory of Wages, Interest and Profits'' (1899).
* ''Essentials of Economic Theory'' (1907).
* ''Social Justice without Socialism'' (1914).
See also
*
Marginal productivity theory
The marginal revenue productivity theory of wages is a model of wage levels in which they set to match to the marginal revenue product of Labour (economics), labor, MRP (the value of the marginal product of labor), which is the increment to revenue ...
*
John Bates Clark Medal
The John Bates Clark Medal is awarded by the American Economic Association to "that American economist under the age of forty who is adjudged to have made a significant contribution to economic thought and knowledge." The award is named after the ...
References
*
Further reading
* Hollander, Jacob H. (1927)
"John Bates Clark as an Economist."In: ''Economic Essays''. New York: The Macmillan Company, pp. 1–5.
* Messori, L. and Orsini, R., "A Biographical Note on John Bates Clark," History of Economic Thought and Policy, 2/2016, pp. 132–140.
* Messori, L. and Orsini, R., "John Bates Clark: the first American marginalist as a social economist", History of Economic Thought and Policy, 2/2018, pp. 33–53.
External links
*
*
Works by John Bates Clark at
JSTOR
JSTOR (; short for ''Journal Storage'') is a digital library founded in 1995 in New York City. Originally containing digitized back issues of academic journals, it now encompasses books and other primary sources as well as current issues of j ...
Works by John Bates Clark at
Hathi Trust
HathiTrust Digital Library is a large-scale collaborative repository of digital content from research libraries including content digitized via Google Books and the Internet Archive digitization initiatives, as well as content digitized locally ...
New School: John Bates Clark, 1847–1938*
{{DEFAULTSORT:Clark, John Bates
1847 births
1938 deaths
Amherst College alumni
Columbia University faculty
Carleton College faculty
Writers from Providence, Rhode Island
19th-century American economists
20th-century American economists
Presidents of the American Economic Association
Neoclassical economists
Neoclassical economics
Economists from Rhode Island