The Hesitant Hand: Market and State in the History of Modern Economic Thought

FAIN: FT-53358-05

Steven George Medema
University of Colorado, Denver (Denver, CO 80202-1702)

The NEH stipend would support the writing of a book entitled, The Hesitant Hand: Market and State in the History of Modern Economic Thought, which is under contract with Princeton University Press. The book is an intellectual history of the theory of economic policy from the late nineteenth century to the present. It traces this history from the demise of the laissez-faire views associated with classical liberalism in the latter part of the nineteenth century, through the rise of the overtly interventionist neoclassical welfare economics tradition, and on to the challenge presented to this approach by the rebirth of classical liberal economics in the second half of the twentieth century.

Associated Products

The Hesitant Hand: Taming Self-Interest in the History of Economic Ideas (Book)
Title: The Hesitant Hand: Taming Self-Interest in the History of Economic Ideas
Author: Steven G. Medema
Abstract: Adam Smith turned economic theory on its head in 1776 when he declared that the pursuit of self-interest mediated by the market itself--not by government--led, via an invisible hand, to the greatest possible welfare for society as a whole. The Hesitant Hand examines how subsequent economic thinkers have challenged or reaffirmed Smith's doctrine, some contending that society needs government to intervene on its behalf when the marketplace falters, others arguing that government interference ultimately benefits neither the market nor society. Steven Medema explores what has been perhaps the central controversy in modern economics from Smith to today. He traces the theory of market failure from the 1840s through the 1950s and subsequent attacks on this view by the Chicago and Virginia schools. Medema follows the debate from John Stuart Mill through the Cambridge welfare tradition of Henry Sidgwick, Alfred Marshall, and A. C. Pigou, and looks at Ronald Coase's challenge to the Cambridge approach and the rise of critiques affirming Smith's doctrine anew. He shows how, following the marginal revolution, neoclassical economists, like the preclassical theorists before Smith, believed government can mitigate the adverse consequences of self-interested behavior, yet how the backlash against this view, led by the Chicago and Virginia schools, demonstrated that self-interest can also impact government, leaving society with a choice among imperfect alternatives. The Hesitant Hand demonstrates how government's economic role continues to be bound up in questions about the effects of self-interest on the greater good.
Year: 2009
Primary URL: http://press.princeton.edu/titles/8899.html
Primary URL Description: URL is for pb edition, published in 2011.
Publisher: Princeton University Press
Type: Single author monograph
ISBN: 978-0-691-122-
Copy sent to NEH?: Yes

Prizes

Best Monograph Award
Date: 5/1/2010
Organization: European Society for the History of Economic Thought

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