Skip to main content
SpringerLink
Log in

Economics in Lausanne: Vilfredo Pareto and the Lausanne School

  • Chapter
  • First Online:
Economic Theory in the Twentieth Century, An Intellectual History - Volume I

  • 516 Accesses

Abstract

This chapter deals with economics in Lausanne in Pareto’s epoch. After presenting Walras’s legacy, the methodological and analytical contribution of Pareto is discussed, starting from the articles making up the Considerazioni which provide a critical assessment of the state of the ‘new economic theories’. The analysis of the Cours d’économie politique follows: the foundation of the experimental method in economics, the restatement of pure political economy, and the examinations of many topics in applied economics. Then the Manuale di economia politica is considered: in particular, the passage from the cardinal to ordinal utility and the new formulation of general economic equilibrium. Lastly, the relationship between economics and sociology in the late Pareto is analyzed. The last part of the chapter deals with the contributions of the economists of the Paretian school.

This is a preview of subscription content, log in via an institution to check access.

Access this chapter

Log in via an institution
eBook
USD 16.99
Price excludes VAT (USA)
  • Available as EPUB and PDF
  • Read on any device
  • Instant download
  • Own it forever
Softcover Book
USD 119.99
Price excludes VAT (USA)
  • Compact, lightweight edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info
Hardcover Book
USD 119.99
Price excludes VAT (USA)
  • Durable hardcover edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info

Tax calculation will be finalised at checkout

Purchases are for personal use only

Institutional subscriptions

Notes

  1. 1.

    For the intellectual biography of Pareto, see Mornati (2018a, b). A third volume is forthcoming.

  2. 2.

    In 1891, Pareto also agreed to write a French preface to a selection of extracts from Marx’s Das Kapital chosen by Paul Lafargue and published in 1893. In this preface, Pareto proposed a strong marginalist critique of Marx’s theory of value, often referred to together with Böhm-Bawerk’s critique.

  3. 3.

    These articles were translated (with editors’ notes) into English in 2007 under the title Considerations on the Fundamental Principles of Pure Political Economy, edited by Roberto Marchionatti and Fiorenzo Mornati.

  4. 4.

    These points are considered in Chipman (1976), Weber (2001), and Marchionatti and Mornati (2003).

  5. 5.

    Walras had considered only the maximum ophelimity of each individual. Nevertheless, without demonstration, he believed that free competition was a maximum for the community. In the Trattato di sociologia (§2129, note 1), Pareto wrote: “Failure to distinguish between the maximum of ophelimity for the community and the maximum of ophelimity of each individual in the community had led certain writers to regard my demonstrations of my theories concerning the maximum of ophelimity for the community as reasoning in a circle. As a matter of fact, in the case of free competition, the equations of economic equilibrium are obtained by positing the condition that each individual attains the maximum of ophelimity; so that if one were to infer from those equations that every individual achieves the maximum of ophelimity, one would obviously be reasoning in a circle. But if, instead, one asserts that the equilibrium determined by the equations has the peculiarity of corresponding to a point of equilibrium for the community…one is stating a theorem that has to demonstrated. This demonstration I gave first in my Cours and then in my Manuale”.

  6. 6.

    In “Il massimo di utilità dato dalla libera concorrenza” (The Maximum of Utility given by Free Competition, 1894), Pareto considers the effects of variations in production techniques on the collective economic welfare. First, they are determined under conditions of free competition. Second, Pareto proves the theorem that the coefficients of production determined by free competition have the identical value to those obtained by determining the coefficients with the conditions to produce the maximum of utility with the minimum of sacrifice.

  7. 7.

    The analogy with Fisher’s formulation in Mathematical Investigations is evident. As a matter of fact, Pareto’s position is analogous to that affirmed by Poincaré (1901, in Jaffé 1965), as Edgeworth (1915) recognized.

  8. 8.

    In his elaboration of the logical/non-logical taxonomy, Pareto was inspired by the classification of the French entomologist Jean-Henri Fabre (an “inimitable observer”, as Charles Darwin called him) and by the works of the French zoologist Edmond Perrier.

References

  • Allen, Roy G.D. 1936. Professor Slutsky’s Theory of Consumers’ Choice. The Review of Economic Studies 3 (2): 120–129.

    Article  Google Scholar 

  • Antonelli, Etienne. 1914. Principes d’économie pure. Paris: Marcel Rivière.

    Google Scholar 

  • Aupetit, Albert. 1901. Essai sur la théorie générale de la monnaie. Paris: Guillaumin.

    Google Scholar 

  • Auspitz, Rudolf, and Richard Lieben. 1887. Zur Theorie des Preises. Leipzig: Duncker & Humblot.

    Google Scholar 

  • ———. 1889. Untersuchungen über die Theorie des Preises. Leipzig: Duncker & Humblot.

    Book  Google Scholar 

  • Barnett, Vincent. 2011. E. E. Slutsky as Economist and Mathematician. Crossing the Limits of Knowledge. New York: Routledge.

    Book  Google Scholar 

  • Barone, Enrico. 1894. A Proposito delle Indagini del Fisher. Giornale degli Economisti. May, pp. 413–439. Reprint in Le Opere Economiche, vol. I. Bologna: Zanichelli, 1936, pp. 21–55.

    Google Scholar 

  • ———. 1896. Studi sulla distribuzione. Giornale degli Economisti 6 (12): 107–155.

    Google Scholar 

  • ———. 1908a. Principi di economia politica. Bologna: Zanichelli.

    Google Scholar 

  • ———. 1908b. Il Ministro della Produzione nello Stato Collettivista. Giornale degli Economisti 2 (September–October): 267–293, 392–414. English Translation: The Ministry of Production in the Collectivist State. In Collectivist Economic Planning, ed. Friedrich von Hayek. London: Routledge & Kegan Paul, 1935, pp. 245–290.

    Google Scholar 

  • Boninsegni, Pasquale. 1902. I fondamenti dell’economia pura. A proposito di un libro del sign. Aupetit. Giornale degli Economisti 24 (February): 106–133.

    Google Scholar 

  • ———. 1910. Précis d’économie politique. Lausanne: Rouge.

    Google Scholar 

  • ———. 1930. Manuel élémentaire d’économie politique. Lausanne: Rouge.

    Google Scholar 

  • Bortkiewicz, Ladislaus (von). 1898. Die Grenznutzentheorie als Grundlage einer ultraliberalen Wirtschaftsppolitik. Schmoller Jahrbuch 22: 1177–1216.

    Google Scholar 

  • Boven, Pierre. 1912. Les applications mathématiques à l’économie politique. Lausanne: Rouge.

    Google Scholar 

  • Bowley, Arthur L. 1924. The Mathematical Groundwork of Economics: An Introductory Treatise. Oxford: Clarendon Press.

    Google Scholar 

  • Chipman, John S. 1976. The Paretian Heritage. Revue Européenne des Sciences Sociales. Cahiers Vilfredo Pareto 14 (37): 65–171.

    Google Scholar 

  • Dooley, Peter C. 1998. Enrico Barone. In Italian Economists of the 20th Century, ed. Ferdinando Meacci, 69–94. Cheltenham: Edward Elgar.

    Google Scholar 

  • Edgeworth, Francis Y. 1881. Mathematical Psychics: An Essay on the Application of Mathematics to the Moral Sciences. London: Kegan.

    Google Scholar 

  • ———. 1915. Recent Contributions to Mathematical Economics, I. Economic Journal 25 (97): 36–63.

    Article  Google Scholar 

  • Fisher, Irving. 1892. Mathematical Investigations in the Theory of Value and Prices, Transactions of the Connecticut Academy of Arts and Sciences, 8. New Haven: Yale University Press.

    Google Scholar 

  • Flux, Alfred W. 1896. Review of Pareto’s Cours d’économie politique. Economic Journal 6 (22): 249–253.

    Article  Google Scholar 

  • Gide, Charles, and Charles Rist. 1909. Histoire des doctrines économiques: depuis les physiocrates jusqu’a nos jours. Paris: J.B. Sirey.

    Google Scholar 

  • Ingrao, Bruna, and Giorgio Israel. 1990. The Invisible Hand: Economic Equilibrium in the History of Science. Cambridge, MA: MIT Press.

    Google Scholar 

  • Jaffé, William, ed. 1965. Correspondence of Léon Walras and Related Papers, 3 vols. Amsterdam: North-Holland.

    Google Scholar 

  • Jannaccone, Pasquale. 1912. Il Paretaio. La Riforma Sociale 23: 337–368.

    Google Scholar 

  • Kirman, Alan. 1987. Pareto as an Economic Theorist. In The New Palgrave. A Dictionary of Economics, ed. John Eatwell, Murray Milgrate, and Peter Newman. London: Macmillan.

    Google Scholar 

  • Koopmans, Tjalling C. 1957. Three Essays on the State of Economic Science. New York: McGraw-Hill.

    Google Scholar 

  • Marchionatti, Roberto. 1999. The Methodological Foundations of Pure and Applied Economics in Pareto. An Anti-Walrasian Programme. Revue européenne des sciences sociales. Cahiers Vilfredo Pareto 37: 277–294.

    Google Scholar 

  • ———. 2004. Introduction: The Classical Era of Mathematical Economics. In Early Mathematical Economics 1871–1915, 4 vols, ed. Roberto Marchionatti, vol. I, 1–63. London and New York: Routledge.

    Google Scholar 

  • Marchionatti, Roberto, and Enrico Gambino. 1997. Pareto and Political Economy as a Science: Methodological Revolution and Analytical Advances in Economic Theory in the 1890s. Journal of Political Economy 6 (105): 1322–1348.

    Article  Google Scholar 

  • Marchionatti, Roberto, and Fiorenzo Mornati. 2003. Pareto et l’économie mathématique au début des années’90. Quelques réflections à propos des Considerazioni sui principi fondamentali dell’economia politica pura. In Histoire et théorie des sciences sociales. Mélanges en l’honneur de Giovanni Busino, ed. Mohamed Cherkaoui. Geneva: Librairie Droz.

    Google Scholar 

  • McLure, Michael. 2007. The Paretian School and Italian Fiscal Sociology. London: Palgrave Macmillan.

    Book  Google Scholar 

  • Merritt, Fred D. 1898. Review of Pareto’s Cours d’èconomie politique. Journal of Political Economy 6: 549–552.

    Article  Google Scholar 

  • Moret, Jacques. 1915. L’emploi des mathématiques en économie politique. Paris: M. Giard & É. Brière.

    Google Scholar 

  • Mornati, Fiorenzo. 1999. Pasquale Boninsegni e la scuola di Losanna. Torino: UTET Libreria.

    Google Scholar 

  • ———. 2018a. Vilfredo Pareto: An Intellectual Biography. Vol. I. From Science to Liberty (1848–1891). London: Palgrave Macmillan.

    Book  Google Scholar 

  • ———. 2018b. Vilfredo Pareto: An Intellectual Biography. Vol. II. The Illusions and Disillusions of Liberty (1891–1898). London: Palgrave Macmillan.

    Book  Google Scholar 

  • Mosca, Manuela, and Michael E. Bradley. 2013. Perfect Competition According to Enrico Barone. Cahiers d’économie Politique/Papers in Political Economy 64 (1): 9–44.

    Article  Google Scholar 

  • Osório, António Horta. 1913. Théorie mathématique de l’échange. Paris: M. Giard & E. Brière.

    Google Scholar 

  • Pantaleoni, Maffeo. 1889. Principi di economia pura. Firenze: G. Barbera. English Translation: Pure Economics. London: Macmillan, 1898.

    Google Scholar 

  • ———. 1923. Obituary. Vilfredo Pareto, Economic Journal, 33 (132), 582–590. Extended version in Italian: In occasione della morte di Pareto—Riflessioni. Giornale degli economisti 65 (1–2): 1–19, 1924.

    Google Scholar 

  • Pareto, Vilfredo. 1892–1893. Considerazioni sui principi fondamentali dell’economia politica pura. Giornale degli Economisti 4 (May 1892): 389–420; 4 (June 1892): 485–512; 5 (August 1892): 119–157; 6 (January 1893): 1–37; 7 (October 1893): 279–321. English Translation: Considerations on the Fundamental Principles of Pure Political Economy, ed. by Roberto Marchionatti and Fiorenzo Mornati. London: Routledge, 2007.

    Google Scholar 

  • ———. 1894. Il massimo di utilità dato dalla libera concorrenza. Giornale degli Economisti 5 (1): 48–66. English Translation: The Maximum of Utility Given by Free Competition. Giornale degli Economisti e Annali di Economia 67 (3) (2008): 387–403.

    Google Scholar 

  • ———. 1896–1897. Cours d’économie politique, 2 vols. Lausanne: Rouge.

    Google Scholar 

  • ———. 1897a. The New Theories of Economics. Journal of Political Economy 5 (September): 485–502.

    Article  Google Scholar 

  • ———. 1897b. Il compito della sociologia fra le scienze sociali. Rivista italiana di sociologia I: 45–54.

    Google Scholar 

  • ———. 1898. Comment se pose le problème de l’économie pure. Paper presented at a conference of the Société Stella, Lausanne, December 1898.

    Google Scholar 

  • ———. 1900. Sunto di alcuni capitoli di un nuovo trattato di economia pura del prof. Pareto. Giornale degli economisti 2 (March): 216–235; (June): 511–549. English Translation: Summary of Some Chapters of a New Treatise of Pure Economics by Professor Pareto. Giornale degli Economisti e Annali di Economia 67 (3) (2008): 453–504.

    Google Scholar 

  • ———. 1902–1903. Les Systèmes Socialistes. Paris: Giard et Brière.

    Google Scholar 

  • ———. 1906. Manuale di economia politica. Milano: Società editrice Libraria. French Translation (revisited): Manuel d’économie politique. Paris: Giard et Brière, 1909. English Translation: Manual of Political Economy, ed. A. S. Schweir and A. N. Page. New York: August M. Kelley, 1971.

    Google Scholar 

  • ———. 1907. L’économie et la sociologie au point de vue scientifique. Rivista di Scienza 1: 293–312.

    Google Scholar 

  • ———. 1911. Economie mathématique. In Encyclopédie des sciences mathématiques. Paris: Gauthier Villars. English Translation: Mathematical Economics. International Economic Papers 5 (1955): 58–102.

    Google Scholar 

  • ———. 1916–1917. Trattato di sociologia generale, 4 vols. Firenze Barbera, 1916. French Edition: Traité de sociologie générale. Paris and Genève: Librairie Droz. English Translation: The Mind and Society, ed. A. Livingston. New York: Harcourt Brace and Co., 1934.

    Google Scholar 

  • ———. 1975a [1917]. Jubilé du Professeur Vilfredo Pareto. In G. Busino (ed.), Vilfredo Pareto, Oeuvres Complètes, vol. 20. Geneva: Droz.

    Google Scholar 

  • ———. 1975b. Correspondence, 1890–1923. In Vilfredo Pareto. Œuvres completes of Vilfredo Pareto, vol. 19, ed. Giovanni Busino. Geneva: Librairie Droz.

    Google Scholar 

  • ———. 1984. Lettere a Maffeo Pantaleoni 1890–1923. In Vilfredo Pareto, Œuvres complètes, vol. 28, ed. Giovanni Busino. Genève: Droz.

    Google Scholar 

  • Persky, Joseph. 1992. Retrospectives: Pareto’s Law. Journal of Economic Perspectives 6 (2): 181–192.

    Article  Google Scholar 

  • Poincaré, Henri. 1965 [1901]. Letter to Léon Walras, September 30, 1901. In Correspondence of Léon Walras, vol. 3, ed. William Jaffé, cit., 1965.

    Google Scholar 

  • Schumpeter, Joseph A. 1914. Epochen der Dogmen- und Methodengeschichte. In Grundriss der Sozialökonomik. I. Abteilung: Wirtschaft und Wirtschaftswissenschaft, ed. Max Weber et al. Tübingen: J.C.B. Mohr.

    Google Scholar 

  • ———. 1949. Vilfredo Pareto (1848–1923). The Quarterly Journal of Economics 63 (2): 147–173.

    Article  Google Scholar 

  • ———. 1954. History of Economic Analysis. New York: Oxford University Press.

    Google Scholar 

  • Slutsky, Eugen. 1915. Sulla teoria del bilancio del consumatore. Giornale degli Economisti 51 (July): 1–26.

    Google Scholar 

  • Volterra, Vito. 1906. L’Economia Matematica e il nuovo manuale del professor Pareto. Giornale degli Economisti 32 (April 1906): 296–301. English Translation: Mathematical Economics and Professor Pareto’s New Manual. In Preferences, Utility and Demand: A Minnesota Symposium, ed. John S. Chipman, Leonid Hurwicz, Marcel K. Richter, and Hugo F. Sonnenschein. New York: Harcourt Brace Jovanovich, 1971.

    Google Scholar 

  • Walker, Donald. 1996. Walras’s Market Models. Cambridge: Cambridge University Press.

    Book  Google Scholar 

  • Walras, Léon. 1889. Eléments d’économie politique pure. 2nd ed. Lausanne: Rouge. English Translation: Elements of Pure Economics. London: Allen and Unwin, 1954.

    Google Scholar 

  • ———. 1890. Observations sur le principe de la Théorie du prix de MM. Auspitz et Lieben. Revue d’économie politique 4 (May–June): 320–323.

    Google Scholar 

  • ———. 1896. Etudes d’économie sociale. Lausanne: Rouge.

    Google Scholar 

  • Weber, Christian E. 2001. Pareto and the 53 per cent Ordinal Theory of Utility. History of Political Economy 33: 541–576.

    Article  Google Scholar 

  • Wicksell, Knut. 1897–1899. Vilfredo Pareto’s Cours d’économie politique. Zeitschrift für Volkswirtschaft, Sozialpolitik und Verwaltung 1897: 159–166; 1899: 95–100.

    Google Scholar 

  • Zawadski, Wladyslaw. 1914. Les mathématiques appliquées à l’économie politique. Paris: Rivière.

    Google Scholar 

Download references

Author information

Authors and Affiliations

  1. Department of Economics and Statistics, University of Turin, Turin, Italy

    Roberto Marchionatti

Authors
  1. Roberto Marchionatti
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Roberto Marchionatti .

Rights and permissions

Reprints and permissions

Copyright information

© 2020 The Author(s)

About this chapter

Check for updates. Verify currency and authenticity via CrossMark

Cite this chapter

Marchionatti, R. (2020). Economics in Lausanne: Vilfredo Pareto and the Lausanne School. In: Economic Theory in the Twentieth Century, An Intellectual History - Volume I. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-030-40297-6_4

Download citation

  • DOI: https://doi.org/10.1007/978-3-030-40297-6_4

  • Published:

  • Publisher Name: Palgrave Macmillan, Cham

  • Print ISBN: 978-3-030-40296-9

  • Online ISBN: 978-3-030-40297-6

  • eBook Packages: Economics and FinanceEconomics and Finance (R0)

Publish with us

Policies and ethics

Search

Navigation