Marjorie Grice-Hutchinson (1908-2003) played an important role in bringing attention to the contributions to economics of late medieval Spanish scholars, particularly the “School of Salamanca.” In Early Economic Thought in Spain, 1177-1740, first published in 1978 and out in a handsome new edition from the Liberty Fund, she delves also into the ideas and the writers that preceded and succeeded the Salamancan scholars. Grice-Hutchinson studied in London at King’s College, at Birkbeck College, and then at the London School of Economics, where she conducted research under F.A. Hayek, one of her most influential teachers. She moved to Málaga in 1951 after marrying Baron…
As noted in the first post, Albert Gallatin initially aspired to being a private, rather than a political, entrepreneur. To that end the firm of Albert Gallatin and Co. tried to attract renters or buyers to land in Pennsylvania. McCraw describes how the firm “organized a company store, a boatyard on the Monongahela, and later a glassworks.” (192) Like many commercial men of his day, not the least of whom was Robert Morris, Gallatin’s speculations in land development eventually failed, but the experience of trying to make a go of it in the private economy was important.
Unlike Hamilton, Gallatin had a more nuanced feel for the variations of taste and opinion that a businessman must have to adapt to opportunities as they are, rather than as he might wish them to be. Failure has a way of accentuating the point. Again, McCraw’s text does not specifically highlight this difference, but it comes through well enough in the evidence.
As noted in the two previous posts, a powerful illustration is the attitude of both men to the subject of finance and its relationship to the economy. Most of those who dabbled in political economy at the time presented a hodgepodge of Smithian free-trade arguments and mercantilist expediencies, and neither Hamilton (as we have seen) nor Gallatin were immune to the mixing of apples and oranges.
Adam Smith’s Wealth of Nations was published the same year as the Declaration of Independence, and Hamilton was right to perceive a growing appreciation of its basic message among his countrymen. Smith wrote to dispel the errors of mercantilism. Hamilton wrote to keep them current. In particular, he was fond of Sir James Steuart, who represented Smith’s “chief foil.” Curiously, McCraw buries this in his footnotes at the back of The Founders and Finance. (383/4 n. 4) But McCraw is not at all hesitant to declare Hamilton a “first-class student of both economics and administration.”
Hamilton apparently saw “how everything in the national economy was related to everything else.” And “he saw that in the construction of grand strategy, every move must be coordinated so as to make the whole of public policy exceed the sum of its parts.” Hardly reserved in his applause, McCraw proceeds, “And this is what he proceeded to do as secretary.” (93) But one can take a different view, and in the matter of economic theory, one would be right to do so.