Question

What were Alfred Marshall's economic perspectives?

Do you agree/disagree?

Answer 1

Marshall’s reflections on aspect of military conflict in relation to the nineteenth century and early twentieth century concerns about Britain’s industrial weakness and relative competitiveness. The two conflicts occurred in a period (from the late nineteenth century through to the early twentieth century) when Britain was clearly losing her economic leadership to countries such as America and, more importantly, Germany. As we have seen, events during and following these two wars provided opportunities for Marshall to participate in public debates and to reflect upon, further develop, and (where necessary) adapt important aspects of his economic thought.

the experience of the World War I generated interesting—and significant—changes in Marshall’s thought. In terms of the role of government, World War I emphasized the urgency to have the public control and management of some crucial productions: this was also recognised and accepted by Marshall although, for him, this could be accepted only in very exceptional cases such as a war. Finally, large standardized businesses during the war became the only (and necessary) way to provide large quantities of war-related products at low costs. Yet this remained true even after the war, especially for commodities requiring large, mass productive processes. Notwithstanding Marshall’s preference for small and medium firms, in the years after World War I, he increasingly recognized the proper fundamental scope of large businesses. Yet he also remained highly critical of any combination, especially trusts and cartels, as being detrimental to public interest.

A final point, it is perhaps useful to note that Marshall’s cosmopolitan perspective went beyond the simply economic dimension of the idea of free trade. The experiences of World War I, coupled with his idea of a cosmopolitan order, reinforced Marshall’s creed that economic, political and even social relations had to become more peacefully integrated.