Evolutionary and biophysical economics

from James Galbraith

The evolutionary and biophysical approach to economic phenomena is not a new thing, and actually long predates the neoclassical orthodoxy from which some believe it now springs. It began with the intellectual interplay of Malthus and Darwin, developed through Marx and Henry Carey and (to a degree) in the work of the German Historical School, brewed and fermented in the pragmatic and pluralist effervescence of late 19^th century American philosophy, and achieved a first full articulation in the hands of Thorstein Veblen (1898). It thereafter developed in the Institutionalist tradition of John R. Commons (1934) and Clarence E. Ayres (1944), among many others, and emerged as the dominant intellectual force in American economics under the New Deal. 

The Keynesian and Institutionalist traditions then merged again in North America in the hands of John Kenneth Galbraith (Carter, 2020), and the line of work known as Post Keynesian was pursued by Robert Eisner, Hyman Minsky, Paul Davidson and Wynne Godley; it has now been popularized by William Mitchell, Randall Wray (2006), Stephanie Kelton (2020), Pavlina Tcherneva (2020) and others as Modern Monetary Theory. In Britain the Keynesian cause was carried forward by Richard Kahn, Nicholas Kaldor (1985), Joan Robinson, and others, with close ties to an Italian strain led by Luigi Pasinetti, Pierangelo Garegnani, Mario Nuti and others. The calamity of the great financial crisis is treated in many books and articles, a notable example being Varoufakis, Halevi and Theocarakis (2011). Specific attention to the problem of resource quality originates with Jevons, was developed in the modern era by Meadows et al. (1972) and is advanced today by the biophysical school (Hall and Klitgaard, 2018), (Chen and Galbraith, 2009). A further branch of the Institutionalist approach, with roots in Marx and Keynes, occurred in Development Economics, epitomized by such figures as Albert Hirschman, Raoul Prebisch, Samir Amin and many others, and carried forward still today by (among others) Ha-Joon Chang and Ilene Grabel (2014), Jayati Ghosh, and Luiz Carlos Bresser Pereira (2010). One might further identify a branch of transition-economy and China studies, in which the New Pragmatism of Grzegorz Kolodko (2020) figures, along with Isabella Weber’s (2021) path-breaking history of Chinese policy-making. There are many more; applications will vary according to problems.

What is economics? A policy discipline for the real world