John Richard Hicks Economics Theory

Sir John Richard Hicks's Contributions to Economic Theory

Hicks Economics

The works of Professor Hicks span more than half a century from his earliest published work in Economica (1928) to his latest book Causality in Economics (1979a). However, so much of his presti­gious output has been rapidly absorbed into the main body of economic analysis that the Hicksian origin of much of con­temporary theory has become obscured. Therefore, the main purpose of this essay will be to highlight the early contributions of Hicks and to emphasise the revolutionary impact that much of his writings have had on th,e literature. A curious aspect in this development is that, despite their novelty, Sir John's writings have produced very little controversy. As regards his earlier writings, this lack of controversy can be explained by the almost immediate acceptance by the profession of Hick's pioneering efforts but his later works have stirred little controversy largely because they have been neglected.

Thus in addition to highlighting Hicks's major contributions to theoretical economics, we will also try to account for the apparent asymmetry between his earlier and later works.

J. R. Hicks was born in 1904 in Warwick. At the age of seventeen he won a scholarship to Balliol College, Oxford. He gained a first in mathematical moderation and transferred to PPE in which he graduated in 1925. In 1926 he became an assistant lecturer at the London School of Economics. He remained there until 1935 and during this period he produced some of his best work: the invention of the elasticity of substitution (1932), the distinction of income and substitution effects (Hicks, 1934a with R. G. D. Allen) and the identification of the liquidity spectrum (1935). From 1935-8 he held a fellowship at Cambridge. During this time he completed Value and Capital (1939a) and also wrote two influential reviews of Keynes's General Theory. He was then appointed to his first chair at Manchester University which he held until 1946. His major contributions at this time were in the area of consumers' surplus and welfare economics (1941). From 1946-52 he was a fellow at Nuffield College, Oxford, and then Drummond Professor of Political Economy at Oxford until his retirement in 1965. In this period he published his Trade Cycle (1950) and Revision of Demand Theory (1956a).

These works, which complete Hicks's early contributions to economic theory, have recently been referred to as the writings of Hicks the Younger (Leijonhufvud, 1979). However, before retir­ing Hicks produced two further pieces of analysis that indicate a major change of emphasis in his economic thinking (1956b, 1963) and since then he has produced a further seven major works (1965, 1967, 1969, 1973, 1974a, 1977, 1979a) which have served to highlight the redirection of his thinking. These latter contri­butions, again following Leijonhufvud, may be referred to as those of the Elder Hicks.

This essay will continue this distinction between the two formative periods in Hicks's work. Consequently we begin by elaborating Hicks's earlier contributions and tracing the extensive developments that these contributions spawned in the 1950s and 1960s. However, it is of interest to note that Hicks took little part in the refinements that were initiated in almost all branches of the subject as a direct result of his pioneering analysis. We attempt to account for this lack of interest and uSe it to introduce the works of the Elder Hicks.