Alfred Marshall: Putting micro @ heart of economics studies (1)

Anthony Kila is a Jean Monnet professor of Strategy and Development. He is currently Centre Director at CIAPS; the Centre for International Advanced and Professional Studies, Lagos, Nigeria. He is a regular commentator on the BBC and he works with various organisations on International Development projects across Europe, Africa and the USA. He tweets @anthonykila, and can be reached at anthonykila@ciaps. org

THIS GENERATION IS USED to and familiar with the notion that economics is a systematic authoritative and independent study that, based on observations of gathered data, inductions and deductions, calculations and projections, can arrive at conclusions and prescriptions capable of solving tangible problems in our daily lives. We are now used to the idea that like every method-based study, economics is capable of understanding and accommodating complexities, contradictions, rarities, peculiarities as well as new discoveries and frontiers that an object of study might present. It is now obvious to us that like any other study, economics uses other studies like history, mathematics, psychology to arrive at its own conclusions and laws whilst contributing to these same auxiliary studies. The focus of our general education is largely microeconomics.

Things have, however, not always been this way; it was rather far from such. For centuries, economics, or political economy as it was generally known at its inception, was not regarded as systematic study in its own right. Economic theories were derivatives of other studies like philosophy, politics etc. The prevailing area of interest was wealth creation and process of production: Macroeconomics. Until just about hundred years ago, economics was not capable of insisting on putting text into context. It was believed that one theory fitted all and there were no shades or variations in ideas and situations. Our today’s Unforgettable led the change that turned economic studies from what it was into what it has become. His name is Alfred Marshall and he was born in London in 1824. He is regarded as one of the fathers of modern economics, and besides his numerous contributions to content, he must be seen as the one who led the change in the way economics is studied, taught and perceived.

Alfred Marshall, arguably before and more than anyone else, was the first to successfully bring our attention to how complex and relative things can be in economics when conceived as a systematic study, “every short statement about economics is misleading (with the possible exception of my present one)” he quipped.

Alfred Marshall’s interest in and attraction to economics were largely built on the fact that he saw it as the subject and study that can help provide solutions for individuals and the masses. For him economics was the study that can and should provide a solution to the problem of poverty and improve the lives of many. He felt economics was not doing that thus far, and he was not convinced nor satisfied with the focus on wealth of nations and he moved to a refoundation of the study of economics. He shifted the attention of the study from macro to microeconomics. As part of his efforts and achievement in the refoundation of economics he led the battle to make economics become a course on its own, a study in which one can graduate (in Cambridge). As a teacher, his main purpose was to create scholars (economists) with the scientific abilities and skills to reason objectively but moved with passion and compassion for the poor. He wanted them to have “cool heads but warm hearts.” At the Inaugural Lecture Given in the Senate House at Cambridge, in February, 1885, Prof Alfred Marshall in a paper titled, “The Present Position of Economics”, reviewed the state of economics and economists; he then shared with his audience and the rest of us what we can today call his vision and mission statement as a thinker and a teacher. He declared, amongst other things, that “It will be my most cherished ambition, my highest endeavour, to do what with my poor ability and my limited strength I may, to increase the numbers of those whom Cambridge, the great mother of strong men, sends out into the world with cool heads but warm hearts, willing to give some at least of their best powers to grappling with the social suffering around them…”. Alfred Marshall was keen on making economics scientific, hence his insistence on using calculations (his background was in mathematics); but he also wanted to make economics about, and accessible to, the layman. In terms of method of researching and presenting findings, he used and gave his students six tips: “…(1) Use mathematics as shorthand language, rather than as an engine of inquiry. (2) Keep to them till you have done. (3) Translate into English. (4) Then illustrate by examples that are important in real life (5) Burn the mathematics. (6) If you can’t succeed in 4, burn 3….”

You can audit his quest and vision and argue if he has succeeded and is succeeding or less. I think he has and he is; and one thing that cannot be argued is his impact. So much was and is his impact that in recognition of his contribution to the creation of an authoritative independent systematic study and profession, everywhere he taught is named after him, starting from the

Cambridge University department of Economics which is called, “The Marshall Library of Economics”, the Economics Society that is named, “The Marshall Society”, and to the University of Bristol, where the Economics Department is also named after him. His teachings generated many students, some who became leading economists in their own rights.

When Alfred Marshall died in 1924, one of his students, John Maynard Keynes, another icon that made it into our pantheon of “The Unforgettables”, in an essay written as a tribute to Alfred Marshall, whom he recognised as his mentor and tutor, noted that “The master-economist must possess a rare combination of gifts. He must be a mathematician, historian, statesman, philosopher — in some degree. He must understand symbols and speak in words. He must contemplate the particular, in terms of the general, and touch abstract and concrete in the same flight of thought. He must study the present in the light of the past for the purposes of the future. No part of man’s nature or his institutions must be entirely outside his regard. He must be purposeful and disinterested in a simultaneous mood, as aloof and incorruptible as an artist, yet sometimes as near to earth as a politician.”

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