progressive utilization theory

Summer 1927, D3/12/3: 15; A4.4.xi

But later, having been advocated by Marx to beat the capitalists, it was necessary for the defenders of the present system to devise a new theory, the utility theory of value.

As to Ricardo, it should not be thought that he was consciously biassed in his theory, that he was the champion of the rising capitalist against the landlord. This accusation was raised in his face in parliament (see Cannan, Ricardo in Parliament, Ec. J. 1892) and he succesfully cleared it out [away] by showing that in fact his property mainly consisted of land. It is of course not necessary for an economist to belong to a given class, or to have private interests at stake bound with that class in order that he should be crossed. It is enough for him to believe that one is a progressive class, that its success will be in the interest of majori community as a whole to justify him.

As to Marx, the fact that the utility theory of value had been found several times before (by Cournot, Dupuit, Gossen) and had fallen flat, while when it was again almost simultaneousley published by Jevons, Menger and Walras in the years immediately following the publication of Vol I of Capital, found suddenly a large body of opinion prepared to accept it and support it, is significant enough (Ashley, Present Pos. of P. E., Ec. J. 1910?)

[Note that the later development of Marshall, which was thought to be quite as effective in pulling down the basis of Marx’s theory of value, is not at all incompatible with it]