˜Anœ Outline of International Price Theories

385 Pages·2013·20.216 MB·English

by  Wu, Chi-Yuen

AN OUTLINE OF
INTERNATIONAL PRICE
THEORIES
By
CHI-YUEN WU
Ph.D. (Econ.)
With an Introduction by
PROFESSOR LIONEL ROBBINS
LONDON
GEORGE ROUTLEDGE & SONS, LTD.
BROADWAY HOUSE: 68-74 CARTER LANE, E.C.
First published 1939
PRINTED IN GREAT BRITAIN BY
STEPHEN AUSTIN AND SONS. LTD.. HERTFORD
CONTENTS
PAGE
ACKNOWLEDGMENT. ix
INTRODUCTION BY PROFESSOR LIONEL ROBBINS. xi
CHAPTER I
INTRODUCTION.
1. Introductory remarks. I
2. The four major problems in the theory of inter-
national price relationships: the Problems. i
3. A bird's-eye view of the historical development
of the theory. 5
4. The plan of the following chapters. 10
CHAPTER II
THE MERCANTILISTIC THEORIES.
1. Mercantilism : four stages of its development.
The first period: before 1550. 13
2. The second period : 1550 to 1620. The contro-
versy concerning the price revolution (Hales,
Malestroit, Bodin). 15
3. The foreign exchange controversy. 22
4. Gerrald de Malynes. 25
5. The third period : 1620 to 1680. The balance of
trade controversy (Mun and others). 29
6. Vaughan, Petty and Potter. 35
7. The fourth period : 1680 to about 1750. The
first protectionist controversy (Cary, Pollexfen,
Child, Davenant). North, a free trader. 39
8. John Locke and N. Barbon. 46
9. The doctrine that money stimulates trade and
production : Law, Melon and Forbonnais. 54
10. " The semi-equilibrium doctrine " : Vanderlint,
Cantillon and Harris. 62
11. Summary. 71
VI CONTENTS
CHAPTER III
FROM DAVID HUME TO JOHN STUART MILL : THE
DEVELOPMENT OF THE CLASSICAL THEORIES.
1. David Hume. 75
2. The Physiocrats and Adam Smith. 79
3. The Bank Restriction Controversy: 1797 to
1803 : Boyd, Thornton and others. 84
4. 1803 to 1808 : Foster and the Report of the
Committee on Irish Currency and Exchanges. 102
5. Wheatley and Blake. 106
6. The report of the Bullion Committee. Ricardo,
Malthus and Bosanquet. Contributions of
the participants in the Bank Restriction
Controversy. in
7. Nassau Senior. 123
8. The Bank Charter Act Controversy: the
currency school (Norman, Loyd and Torrens);
the banking school (Tooke and Fullarton). 129
9. The restatement by J. S. Mill. 141
10. Summary. 149
CHAPTER IV
THE CLASSICAL THEORY OF INTERNATIONAL TRADE.
1. The argument for a separate theory for inter-
national trade. 153
2. The doctrine of comparative costs : Torrens and
Ricardo. 155
3. The same subject continued : Marshall and
Haberler. 160
4. The doctrine of reciprocal demands : Longfield,
Torrens, Pennington and J. S. Mill. 163
5. Marshall's restatement of the theory of inter-
national value as an improvement upon the
classical theory of international value. 170
6. Cost of transport as a factor in international
trade. 175
ø
7. The classical theory of international trade as the
foundation of the classical theory of inter-
national price relationships. 178
CONTENTS Vll
CHAPTER V
POST-CLASSICAL DEVELOPMENT OF THE MONETARY
ASPECTS OF THE THEORY OF INTERNATIONAL PRICE
RELATIONSHIPS : 1848-1918.
1. The controversy concerning the gold discoveries
of 1848-1851: Austin, Stirling, Chevalier
and Newmarch. 185
2. The same subject continued: Levasseur,
Cairnes, Jevons and Leslie. 191
3. The rate of interest as a regulator of the inter-
national movement of specie (i.e. by in-
fluencing the rate of foreign lending):
Goschen, Bagehot and Laughlin. 203
4. The rate of interest both as a regulator of the
international movement of specie and as a
regulator of price movements : De Laveleye
and Juglar. 209
5. The indirect chain of effects that connect money
and prices : Sidgwick, Gifíen and Marshall.
Other contributions of Marshall. 212
6. Knut Wicksell. 221
7. Later restatements of the classical doctrine :
Mises and Taussig. 232
8. The theory of R. G. Hawtrey. 239
9. Summary. 246
CHAPTER VI
DEVELOPMENTS SINCE 1918: THEORIES OF THE
EXCHANGES UNDER DEPRECIATED CURRENCIES.
1. Preliminary remarks. The balance of payments
theory. 247
2. The purchasing power parity theory : Cassel's
version of the theory. 250
3. The place of cost of conveyance and the role of
international demands : Pigou, Viner and
Heckscher. 254
4. The dynamic factors : the secondary changes
in data, the importance of the psychological
elements and the problem of causal sequence.
The effects of a change in the rate of the
exchanges on prices and trade. 260
Vlll CONTENTS
CHAPTER VII
DEVELOPMENTS SINCE 1918: THE TRANSFER PROBLEM.
1. Theories of transfer and their developments
before the Great War. 272
2. The earlier controversy : Taussig, Wicksell
and Viner. 279
3. The reparation discussions : the controversy
between Keynes and Ohlin. 284
4. The restatements by Haberler, Iversen and
Nurkse. 296
CHAPTER VIII
DEVELOPMENTS SINCE 1918 : ATTEMPTS TO EXTEND
THE MUTUAL INTERDEPENDENCE THEORY OF
PRICING TO THE DOMAIN OF INTERNATIONAL
ECONOMICS.
1. The case of joint production and the problem of
general equilibrium : Sismondi and Longfield:
Pareto and his disciples. 301
2. The theory of international trade of Bertil Ohlin. 304
3. The theory of international price relationships
in the case of joint production. 309
CHAPTER IX
CONCLUSION.
1. The present position of the theory of inter-
national price relationships : the answers to
the four major problems in the theory. 317
2. The same subject continued : the dynamics of
the theory. 319
APPENDIX
BIBLIOGRAPHY.
1. The mercantilistic period. 323
2. From David Hume to J. S. Mill. 328
3. The post-classical developments : 1848-1918. 335
4. The developments since the War. 341
INDEX OF SUBJECTS. 357
INDEX OF NAMES. 369
ACKNOWLEDGMENT
This essay, which has been approved by the University
of London for the award of the Degree of Doctor of
Philosophy, was prepared by me under the supervision
and with the constant help of Professor Lionel Robbins
during the years 1935 and 1936. I am indebted to him,
firstly, for direction of the large amount of research work
which was required, and secondly, for ideas and guidance
in the planning and preparation of the essay. He has read
through the entire manuscript, and, but for his criticisms
and suggestions at every stage of its preparation, it could
not have taken its present form. Dr. P. N. Rosenstein-
Rodan also gave generously of his time to criticize the
first part of the essay. That the essay has many short-
comings is a fact of which I am fully conscious. The
responsibility for them, of course, is solely mine.
I owe a debt of gratitude to the Board of Trustees for
the Administration of the Sino-British Foundation in
Nanking for granting me the scholarship in Economics
for 1934-7, because, but for that financial help, my studies
in England and the preparation of this essay could not
have been undertaken.
Finally, my thanks are due to the authorities of the
Library of the British Museum, of the Goldsmiths' Company's
Library of Economic Literature, and of the British Library
of Political and Economic Science for granting me the use
of those institutions.
C. Y. Wu.
LONDON,
1937.