In the world of the twenty-first century, the study of economics has taken over the burden that once fell to the concept of empire. In contemporary global relations, power and privilege are thought primarily within an economic rhetoric; empire's frank assertions of hierarchy in race, class, and gender have been replaced in foreign policy by the sanitized terms of development, growth, and free trade. Public discourse on social and political policy, liberal and conservative, rests at every turn on an economic imperative of one form or another.1 At the same time, the last decade has brought an expansion of financial institutions, consumer credit instruments, and capital investment programs, which can make citizenship appear only a matter of personal investment strategy and wealth creation. As an academic discipline and as a practice of public policy, economics is a crucial tool for sustaining the view that distribution of resources, either at the level of the household or of the international agreement, is today nonviolent and non-coercive. The discipline's explanatory power, its ability to theorize the expansion of markets as a form of social progress, was consolidated in the middle decades of the nineteenth century. This book studies that process of consolidation, examining the cultural and philosophical preconditions of the discipline's difficult birth.
The nineteenth century witnessed the failure of one set of economic concepts, known today as classical political economy, and the birth of a new one, now called “neoclassical” economics. The period between the demise of the first and the rise of the second was remarkably short, consisting roughly of the twenty years between 1850 and 1870. In this period the concepts provided by political economists to explain the functioning of capitalism, its force in history, and its impact on society, were in turmoil, and this turmoil is visible not only in debates among theorists themselves, but in governmental policy, and in popular discussions of factories, wages, agriculture, and stock shares.