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Political Economy

wealth, science, term and mill

POLITICAL ECONOMY. The term econom ics, derived from the Greek words olKoc (house hold) and vopoc (law or regulation), was used by Xenophon and in the spurious treatise at tributed to Aristotle, to signify the art of pru dent and systematic household management, with particular reference to family income and ex penditures, and to the labor and satisfaction of the wants of the members of the household. Political CC0110112 iCS, or political economy, as the words imply. originally signified, the art of directing the industry, the consumption, the in comes and expenditures of the State and its sub jects with frugality and care: and in this sense was first used in the Traits de PEconomie Poll ague, published by Monchrkien de Vatteville in 11;15. The use of the word in this significance soon became general. It was not until the nine teenth century that political economy came to be commonly conceived as a neutral science, di vorced from the art of statesmanship. Economics then became the science of wealth, the study of those things which possess exchange value. This view became dominant about 1825, the abstract and theoretical treatment then in favor being di vided into three or four topics: the production, consumption, and distribution of wealth (J. B. Say), or the production, 'distribution, and ex change of wealth (J. S. Mill). most subsequent writers including exchange and a minority fol lowing Mill in excluding consumption. Some

writers (e.g. Senior, J. S. Mill) proposed to limit the term political economy to this com paratively narrow science of wealth; while oth ers proposed to substitute for the term the titles tistics (Sismondi), Catallactics (Whately) , meaning the science of exchanges. A sharp reaction set in about 1S50 against the attempt to increase the precision of the science by narrowing its scope. The historical School (see below) maintained that the subject of the study was not wealth, but man's relation to wealth; that it was part of a general social science, and could not profitably be divorced from ethics and politics. The first contention, well expressed in Roscher's aphorism that political economy begins and ends in man, has met with practically universal acceptance. The other con tentions of the Historical School are still in dis pute, but they have served effectually to prevent any uniform acceptation of the term political economy. Economics, wrested from its old mean ing of household management, is used or de fended by Jevons, Marshall, Macleod, Ely, and other leading economists, but it is the brevity and not the clearness of the word which preserves it, since as now used it is afrected with all the ambiguity of the longer title.