Smith, Marx, and Keynes

John Maynard Keynes wrote, “The ideas of economists and political philosophers, both when they are right and when they are wrong, are more powerful than is commonly understood. Indeed the world is ruled by little else. Practical men, who believe themselves to be quite exempt from any intellectual influences, are usually the slaves of some defunct economist. Madmen in authority, who hear voices in the air, are distilling their frenzy from some academic scribbler of a few years back.” Since capitalism emerged as the dominant economic system in Europe and North America in the 18th century, theorists and policymakers have sought to understand the logic of this new way of organizing production and distribution. What determined the price of goods? The wages of labor? The profits to owners of capital? Would capitalism grow unceasingly, suffer from cycles, or inevitably decline into stagnation or collapse? Should the government actively regulate the economy, or should it play a minimal role and leave markets to determine outcomes without intervention? Should trade with other countries be regulated or free? What was the responsibility of the government with respect to the poor? Should they be assisted? Controlled? In the vigorous debates over these issues, continuing into the present, Adam Smith, Karl Marx, and John Maynard Keynes are frequently invoked as economic policy. A careful reading of these authors, however, shows that they were far more complex thinkers than the simplified versions of their ideas commonly circulated. This course will focus on the debates about value, distribution, economic dynamics, and the role of government through a careful reading of Smith, Marx, and Keynes in the original, followed by an examination of modern interpretations of their ideas.