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James Anderson, Development Economist: a cautionary tale
Author(s) -
Gee J. M. Alec
Publication year - 1998
Publication title -
the manchester school
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.361
H-Index - 42
eISSN - 1467-9957
pISSN - 1463-6786
DOI - 10.1111/1467-9957.00126
Subject(s) - externality , economics , relevance (law) , adam smith , moral hazard , intervention (counseling) , neoclassical economics , economic thought , positive economics , law , incentive , microeconomics , psychology , political science , psychiatry
James Anderson, 1739–1808, analysed the relatively backward and underdeveloped Scottish economy of his time. Anderson stressed the crucial importance of externalities and the adverse developmental effects of moral hazard and considered active intervention, such that the forces of self‐interest are allowed positive play, to be essential to the development process. His approach and analysis are compared with those of Sir James Steuart, John Rae, and Adam Smith and the classical school. It is argued that Anderson’s analysis is of relevance today, and he was more objective in his approach than was Adam Smith and his followers.