Interventionism and the Historical School

Economic History Of France and Belgium

Beginning in the seventies of the last century, however, a new tendency slowly crept into French economic thought. German influence had been virtually unfelt till about this time. Then, as a result of the Franco-Prussian War (1870), more curiosity concerning German thought sprang up. Perhaps, too, the result of the war somewhat shook French optimism. Laveleye made the so-called "Socialism of the Chair" known, and M. Block wrote of German books and thought; while through the activity of Paul Gide the historical spirit of Savigny penetrated the teaching of Roman law. Charles Gide studied under Roscher.

Laveleye (1822-1892) was a Belgian writer and professor at Liege. His works deal with freedom of commerce, money and crises, rural economy and land systems, property and Socialism. His views were considerably like those of the Katheder Socialisten, as he took the historical standpoint and denied the existence of natural laws. He will be remembered for his arguments favoring the belief in an original community of property; and, as to economic theory, for his analysis of the forces determining the productivity of labor. He was a strong advocate of international bimetalism.

The Franco-Prussian war, too, brought in its train a host of practical problems, and ultimately a veritable regeneration in politics and economics.

All this tendency would probably have been ineffectual, however, if the monopoly of economic instruction which was held by a few special schools in Paris and the College de France had not been broken. In 1878, courses in Economics were instituted in the faculties of law of various French universities. Since few if any of the Liberalists had the training in law which was required, this meant new teachers. Moreover, it will be noted that, as teachers of law, the new men were sympathetic toward state interference, and that they were not trained in the doctrines of the French Liberalists. These new men, then, were inclined to follow the Historical School, and to advocate government intervention for social reform.

Accordingly, in 1879 came Cauwes' Cows d'economie politique. Gide published his Principes d'economie politique in 1883. Translations of Schmoller, Wagner, and Brentano appeared; and in 1887 the Revue d'economie politique was established as the organ of the new tendencies. Cauwes' notable book was nationalistic, advocating protection, and following German ideas to the extent of placing the nation and actual conditions to the fore, abandoning the procedure of reasoning from absolute universal laws. In this, List was his master.

However, the Historical School proper and its peculiar method seem to have found little favor among the French economists. In fact, Historicism as a methodology has attracted relatively little attention, although Seignobos and H. Hauser were among the few who early took up the cudgels for it; and de Greef (a Belgian), under the influence of Comte, has a sociological approach somewhat akin. It was rather to an increased study of systems other than individualism, that the new movement led, and to an acceptance of more government intervention in economic affairs.
Here the difference between the French government and that of Germany has made a difference in the thought of the two nations. The French do not look upon the state with the eyes of Germans, but regard it more as an American would. Consequently they sought some other means of obtaining the goal of the German State Socialists than that of state activity. Indeed, the great mass of the French population is middle-class, not proletarian, in its interests, and except for the laborers of the manufacturing centers, has not responded readily either to movements for extending the power of the state so as to restrict individualism greatly, or to anti-capitalistic Socialism.

As to their economics, the majority of the professors in the faculties of law, as just indicated, differ from the Liberalists. They are what C. Gide terms "interventionists." They have devoted their energies largely to the study of current problems, notably the labor problem, and have advocated government protection. The International Association for the Legal Protection of Labour (Paris, 1900) drew from their number, M. Cauwes being president of the French section. Gide mentions as adherents, Jay, Pic, Aftalion, and Bourguin, the last named being the author of Les systemes socialistes el Vevolution kco-nomique (1904). In this book, the author, after critically examining the various plans for solving the social problem, decides adversely to Socialism. Between 1900 and World War I, however, the chief products of the professorial group in pure theory, Landry's L'interet du capital (1904) and Manuel economique (1908), appear to have come through the faculty of science. (Landry, while opposed to private property in land and capital goods — and an admirer of Effertz — is essentially Neo-Classical in his economic theories. He makes contributions to the analysis of demand and supply with reference to capital, and the functioning of monopoly in fixing prices.)