Arthur Burns's Economic Philosophy
WOYTINSKY, W. S.
Arthur Burns's Economic Philosophy The Frontiers of Economic Knowledge. By Arthur F. Burns. National Bureau of Economic Research. 366 pp. $5.00. Reviewed by W. S. Woytinsky Economist; author,...
...The history of economic thought in the nineteenth century was characterized by a struggle between two tendencies: that toward accumulation of pragmatic economic knowledge, and that toward development of economic theory as an abstract science...
...The group which Arthur F. Burns has in mind is the National Bureau of Economic Research...
...And yet the book has a unity...
...In thus defining the scope of this book, I do not mean to minimize its importance...
...Not all the Bureau's research projects have yielded spectacular findings, but the combined efforts of the school have had a decisive influence on economic thinking in the United States and abroad...
...Still later, Keynes revived the tradition of Ricardo and Marx by offering a quasi-mathematical model of the modern economic system, based on a very narrow empirical foundation but marvelously fitting the experience of the Great Depression of the 1930s...
...It is an important contribution to the history of modern economic thought in the United States...
...The record of its work therefore belongs to the current history of economic science...
...Meanwhile, another tendency developed in Germany: handling economic science as a purely descriptive, historical discipline and concentrating all attention on empirical research, without concern for generalizations...
...Such was the philosophy of the National Bureau under its first director, Mitchell, and such it has remained under Burns...
...The Marxist school sacrificed knowledge of economic facts to perfecting a theory based on certain socio-political ideas...
...Rather, it consists of Mr...
...But, in contrast to the historical school, they regard fact-finding research as spadework for theoretical generalizations, which, in turn, must provide the foundation for a successful economic policy...
...The historians disagree as to whether his exploration of the Wealth of Nations was a theory or a description of the contemporary economy, but it marked the beginning of modern economic science...
...This science emerged in the eighteenth century from occasional discussion of single phenomena related to agriculture, taxation, currency, foreign trade and similar topics...
...Most of the papers presented in this book are excellently written, and the book as a whole has a refreshing unity of purpose...
...The papers and articles of Arthur F. Burns, now brought together between two covers, not only describe the recent work of the Bureau but provide insight into its leading ideas, tying single projects to the crucial, controversial problems of economic theory...
...Some economic laws were firmly established and widely accepted when Adam Smith brought them together and presented them in a systematic form...
...Smith's successors, true to the philosophical ideas of the time, tried to strengthen the abstract, theoretical structure of the new discipline...
...Several decades elapsed before the new ideas could be consolidated into an internally consistent theoretical system...
...It is worthwhile to put this philosophy into the perspective of the development of economic science over the past two centuries...
...author, "Labor in the United States" and other books The title of this book may seem a misnomer: The volume does not discuss the frontiers of economic knowledge, but rather records the efforts of a group of American economists to extend those frontiers...
...No part of it was designed as a chapter of a comprehensive study...
...In the latter part of the nineteenth century, the Austrian school laid the foundations for new economic generalizations, broader and deeper than those of Adam Smith...
...The form of the book is somewhat unusual...
...Friedrich List and his followers combined keen observation of facts with an almost complete disregard for theory...
...In the work of Ricardo, empirical material was at a minimum and economic problems were treated in almost mathematical terms...
...In the secular struggle between the two concepts of economic science, Mitchell, Burns and the whole National Bureau group occupy an exceptional position...
...They differ from the Ricardians, Marxists and Keynesians in that they are first and foremost researchers and their immediate purpose is to explore things and accumulate precise information on economic phenomena...
...Characteristic of its work has been a systematic attack, carefully planned years ahead, on cardinal problems on the frontiers of our economic knowledge, such as cyclical fluctuations in business, the structure of national income, capital formation, economic growth, etc...
...Burns's introductory papers to the annual reports to the National Bureau of Economic Research for the years 1946-53, his introduction to Wesley C. Mitchell's What Happens During Business Cycles, and several theoretical articles and critical notes...
...The National Bureau of Economic Research is not just another research institution, but a school of economic thought—indeed, the most original and creative school of economic thought in the United States...
...He mentions research clone outside the Bureau only to the extent that it deals with the issues explored by the Bureau...
...The progress in observation in this broad field led to empirical generalizations...
...What holds it together is the underlying philosophy of economic research, the philosophy on which the National Bureau was founded 35 years ago by Wesley C. Mitchell...
...After the turn of the century, Marshall succeeded in consolidating modern empirical and theoretical economic knowledge on the foundations laid by the Austrian school...
Vol. 37 • July 1954 • No. 27
