1. The author is greatly indebted to Professor Henry Higgs, London, Professor Dr. Fritz Karl Mann, Cologne, and Sektionsrat Dr. Ewald Schams, Vienna, who read the manuscript of this Introduction and by their generous comments helped to eliminate some faults and fill numerous gaps.
3. The French translation of Tucker's "Reflections on the Expediency of a Law for the Naturalisation of Foreign Protestants" which Turgot, probably on the suggestion of Gournay, undertook, bears the same fictitious designation of place of printing. The translation, entitled "Questions importantes sur le Commerce," and the original text were presumably printed in Paris. A London bookseller named Fletcher Gyles had, by 1755, long since ceased to exist.
4. The fact that this edition appeared in various guises is presumably attributable to the enterprise of a bookseller, who was anxious to promote sales by altering the title page; it would appear to be dated variously 1755 and 1761.
6. The first edition of this work, although dared 1756 on the title page, did not actually appear until 1757. See G. Weulersse, Les Manuscrits Économiques de Francois Quesnay et du Marquis de Mirabeau aux Archives Nationales (Paris, 1910), p. 19 ff.
7. See "J. J. Rousseau, ses Amis et ses Enemis. Correspondence publicée par M. G. Streckeisen Moultou", with an Introduction by J. Levallois (Paris, 1865), vol. II, p. 265 ff. A more extensive passage is to be found in Oeuvres économiques et philosophiques de F. Quesnay, ed. A. Oncken, (Frankfurt and Paris, 1888), p. 4 ff and a German version in A. Oncken, "Entsrehung and Werden der physiockralischen Theorie," in Vierteljahrsschrift für Staats-und Volkswirtschaft, ed. K. Frankenstein, vol. 5 (Leipzig, 1895), pp. 275 ff., as well as in the same author's "Geschichte der Nationalökonomie." Erstel Teil (Leipzig, 1902 and later), pp. 318 ff. A practically identical account of the conversation taken, however, from a different letter which Mirabeau wrote towards the end of the 1770s, is contained in the first-mentioned article by Oncken; it was taken from the well-known work of L. de Lomiere, Les Mirabeau, nouvelles études sur la societe francaise au XVIIIe Siecle (Paris, 1879), 2:170 ff.
8. See Oncken, "Entstehung und Werden," p. 279. How little authentic Mirabeau's account of the course of this conversation is, can be deduced from the fact that, in a letter written to his brother immediately after the conversation, he describes himself as the victor. See ibid., p. 275, and Lomenie, Les Mirabeau, 2:196.
12. J. F. Melon, Essai politique sur le Commerce (Rouen and Bordeaux, 1734). For that reason Melon cannot be described as preceding Cantillon, for the latter died in the year in which Melon's work appeared.
13. See "Notice abrégée des différents écrits modernes qui ont concouru en France a former la science de l'Economie politique," in Quesnay, Oeuvres Economiques et Philosophiques, under "The Years 1754 and 1755", p. 148.
17. See E. B. de Condillac, "Du Commerce et du Gouvernement, considére relativement l'un à l'autre," (Amsterdam and Paris, 1776), chap. 16, p. 143, Oeuvres Complets (Paris: 1803), vol. 6, p. 141. See also A. Lebeau, Condillac économiste (Paris, 1903), pp. 11, 350, 412.
20. Physiocrats. Quesnay, Dupont de Nemours, Mercier de la Rivière, L'Abbé Baudeau, Le Trosne, Avec une Introduction sun la Doctrine des Physiocrates, des Commentaires et des Notices Historiques par Eugène Daire (Paris, 1846), Part 1, p. 74, 82, 274. It is not easy to understand why Daire did not deal systematically with the Essai, which he thought highly of, in editing the 15-volume Collection des principaux économistes (1843-1848), the second volume of which contains the above-mentioned "Physiocrats"; this fact certainly contributed to the neglect of Cantillon.
Julius Kautz, Theorie und Geschichte den Nationalökonomik, Propyläen zum volks-und staatswirtschaftlichet Studium. Zweiter Teil. Literatur-Geschichte den National-Ökonomik (Vienna, 1860), p. 320ff.
22. Fr. von Sivers, Jahrhûcher für Nationalökonomie and Statistik, vol. 23 (Jena, 1874). On pages 158-62, which are devoted entirely to Cantillon, he writes: "Eschewing superficial opinion, Cantillon, in his "Essai sur la nature du commerce en général," subjects the idea that the entire population is dependent upon the landlords to a process of profound reasoning. More incisive observation and keener powers of discernment lead him to see that value cannot be explained in terms of supply and demand only and that the market price formed by supply and demand gravitates around a mean, which is itself determined by other causes.... It suffices to record, that we find here the three-fold division of society, which was later considered a discovery of Quesnay. The agricultural labourers produce the wealth, only the landlords are truly independent, the artists and merchants are supported by the net income of the landlords. The division of rent is the same as in the 'Analyse du tableau économique'; the only difference is that there the proportions are 18.104.22.168, while here we have a division into sixths."
23. Léonce de Lavergne, Les économistes francais du dixhuitième siècle (Paris, 1870), p. 167. The passage from which the cited quotation is taken continues: "Property in general and specifically landed property is presented as the basis of society. From this principle Cantillon derives all the inferences which follow, especially in relation to freedom of commerce in all its forms. If he had lived longer, he would have become one of the leading figures of the school of the Economistes."
24. W. Stanley Jevons, "Richard Cantillon and the Nationality of Political Economy," Contemporary Review 39, January 1881, reprinted in The Principles of Economics. A Fragment of a Treatise on the Industrial Mechanism of Society and other Papers with a Preface by Henry Higgs (London, 1905), pp. 155-83.
32. Alfred Marshall, Principles of Economics (London, 1891), p. 53. In subsequent editions Marshall altered his verdict and he remarks (in a footnote to the passage, in which he describes the Physiocrats' achievement as the first attempt at a London 1916, Appendix B 2, p. 756), that Cantillon has some claim to being considered systematic.
37. See E. Cannan, A Review of Economic Theory (London, 1929), p. 20n. This fascinating book, which finally prompted me to devote myself earnestly to a study of Cantillon, gives the best synoptic view of Cantillon's importance for the entire development of economics.
42. Ernst Oberfohren, Die Idee der Universalökonomie in der Französischen Wirtschaftswissenschaftlichen Literatur bis auf Turgot (Probleme der Weltwirtschaft. Schriften des kgl. Instituts für Seeverkehr und Weltwirtschaften der Universität Kiel, Nr. 23), (Jena, 1915), p. 124.
43. See W. Lexis, article on "Physiokratisches System" in Handwörterbuch der Staatsissenschaften, 3rd ed. (Jena, 1913) 6:1039: "In particular we find... what are undoubtedly essential elements of Physiocratic theory anticipated... in Cantillon's Essai, even though Quesnay refused to recognize this and in fact spoke disparagingly of Cantillon in a letter (?) to Mirabeau." Cantillon is certainly less one-sided than the Physiocrats. See also his Allgemeine Volkswirtschaftslehre (Leipzig, 1913), in which Cantillon's Essai is similarly described as "the first attempt at a comprehensive theory of the economy" (p. 239).
45. O. von Zwiedineck-Sudenhorst, Die Lohnpreisbildung, Grundriss der Sozialökonomik, Vol. IV/I, p. 320. There the following opinion of Cantillon is expressed: "This Irish pioneer of Physiocratic ideas spells out all the essential arguments which are to be found in what is commonly considered to be the edifice of classical theory."
47. The most detailed monograph concerning the subject matter of the Essai and its relationship to both earlier and later works is that of R. Legrand, Richard Cantillon, Un Mercantiliste Precurseur des Physiocrates (Paris, 1900). Like most other studies of Cantillon, it suffers from the shortcoming that a focusses not so much on Cantillon's originality as on the question whether one should consider him as being still part of the Mercantilists or already part of the Physiocrats. Detailed discussion of the contents of the Essai are also contained in the already mentioned studies of Jevons, Espinas. Higgs (Quarterly Journal of Economics 6 (1892), as well as in W. Rouxel, "Un Precurseur des physiocrates: Cantiflon," Journal des Economistes (1892); W. Kretschmer, "Über den Richard Cantillon zugeschriebenen Essai sur la nature du commerce en général mit besonderer Berücksichtigung der Lehren von Otto Effertz" (diss., Liestal, 1899). Analytical studies of specific theories of Cantillon will be referred to as the occasion requires.
50. A. Huart, "Cantillon, Precurseur des Hedonistes," Monde économique. May 17 and 31; June 7, 21 and 28; July 29, 1913. For information concerning this article, which was not available in either the Vienna or the Berlin libraries, I am indebted to Sektionsrat Dr. Ewald Schams, Vienna.
52. Apart from the aforementioned studies of Jevons, Higgs, and Neumann, see especially A. Landry. "Une théorie négligée. De l'influence de la direction de la demande sur la produaivité du travail, les salaries et la population, Revue d'Economie politique, 24 (Paris, 1910), and "Las idees de Quesnay sur la population," Revue d'histoire des doctrines économiques et sociales, 2 (1909): esp. 83 ff. In addition see R. Picard, "Etude sur quelques théories du salaire au XVIIIe siècle," 3 (1910): 153 ff; and R. Gonnard, Histoire des Doctrines de La Population (Paris, 1923), pp. 142, 173 ff., as well as due idem, "Les doctrines de la population avant Malthus," Revue d'histoire économique et sociale 17 (Paris, 1929): esp. 223.
53. Compare the well-known sentence with which Part I of Chapter XI, Book I of The Wealth of Nations commences—"As men, like all other animals, naturally multiply in proportion to the means of their subsistence, food is always, more or less, in demand"—with the exposition in Chapter XV of Part One of Cantillon's Essai, but especially with the sentence—"Men multiply like Mice in a barn if they have unlimited Means of Subsistence" (p. 110). Huart ("Cantillon precurseur des Hedonistes") thinks one is justified in assuming that Malthus was directly influenced by Cantillon.
55. Gaetan Pirou, "La théorie de la valeur et des prix chez W. Petty et chez R. Cantillon," Revue d'Histoire des Doctrines Economiques et Sociales," 4th year (Paris. 1911), p. 271. Apart from the previously mentioned studies by R. Zuckerkandl and R. Legrand, the place of Cantillon's value and price theory in the history of economic thought is also dealt with in R. Kaulla, Die Geschichtliche Entwicklung den Modernen Werttheorien (Tubingen, 1906). pp. 92ff.; and H. R. Sewall, "The Theory of Value before Adam Smith, Third Series, American Economic Association, vol. II, no. 3 (New York, 1981). See also A. Dubois, Revue d'economie politique (Paris, 1897), pp. 849 ff. "Les theories psychologiques de la valuer au XVIIIe siecle."
57. See passage quoted from Silvers and referred to in n.22. [N.B. Note 22 above is to a "von Sivers". I've not had time to verify the exact spelling of the name or whether this typo arose in Hayek's original or in the translation in the Journal of Libertarian Studies, but Sivers is probably the correct spelling based on quickly available circumstantial online evidence about last names and locations during that time period. The Jahrbücher cited in Note 22 above is also unfortunately missing from some library collections, so a table of contents for it was not easy to locate.—Econlib Ed.]
58. P. Harsin, Les doctrines monetaires et financières en France du XVIe au XVIIIe Siecle (Paris, 1928), pp. 227-236. In addition to the studies of Jevons and Legrand, see A. E. Monroe, Monetary Theory before Adam Smith (Cambridge, 1923); J. W. Angell, The theory of international prices (Cambridge, 1923); J. W. Angell, The theory of international prices (Cambridge, 1926) especially p. 207 ff., and F. Hoffman, Kritische Degmengeschichte der Geldwerttheorien (Leipzig, 1907), especially pp. 56-64.
60. In addition to Jevons see S. D. Horton, Sir Isaac Newton and Englands Prohibitive Tarif upon Silver Money (Cincinatti, 1895), reprinted in the same author's Silver and Gold and Their Relations to the Problem of Resumption (Cincinnati, 1895), as well as W. St. Jevons' unfinished reply, "Sir Isaac Newton and Bimetallism" reprinted in his Investigations in Currency and Finance, ed. by H. S. Foxwell (London, 1884), p. 330ff.
61. In place of 1717, Cantillon himself wrote erroneously 1728 (p. 373) and the fact that he used words rather than numbers means that a writing or printing error can practically be ruled out. It is very difficult to understand such an error, since Cantillon not only experienced the event in question but even appears to have been in direct contact with Newton. The error persisted thereafter in the literature and is repeated in Steuart. Inquiry into the Principles of Political Economy, Book III, chap. 7, 3, p. 47 of the 1796 Basle edition or vol. 2, p. 135 of the collected works (London, 1805), as well as in J. G. Hoffmann, Die Lehre vom Gelde (Berlin, 1838), p. 104. On the other hand, in reproducing the relevant passage J. H. Graumann (Gesammlete Briefe vom Gelde etc., Berlin, 1762) corrected the error. See also Ph. Kalkmann, Englands Übergang zur Goldwährung im Achtzehnten Jahrhundert (Strabburg, 1895), p. 127.
On Cantillon's exchange rate theory see A. M. de Jong, Bijdrage tot de Geschiedenis van de Theorie den Wisselkoersen voor Adam Smith, De Economist, 74th year, Nos. 5-8, s'Gravenhage (May-August 1925).
62. See also S. Weulersse, Le Mouvement Physiocratique en France (Paris, 1910), (2 volumes) and the same author's recent work Les Physiocrates (Encyclopédie Scientifique (Paris, 1931) and G. Schelle, Le Docteur Quesnay (Paris 1907), pp. 131-184.
63. In support of what has been said, reference shall be made here to a number of these unfounded statements in the later literature; the earlier sources will be dealt with in due course. The list commences with G. Kellner, who claims Zur Geschichte des Physiokratismus: Quesnay-Gournay-Turgot (Göttingen, 1847), p. 93, that it was Gournay who prompted Cantillon (died 1734!) to translate his Essai. Similarly, a recent author, J. W. Angell The Theory of International Prices (Cambridge, 1926), p. 213n. remarks rather patronizingly that it is improbable that Cantillon got his ideas from Hume's Essays, the date of whose publication he pushes back to 1741 in place of 1752. It was Grimm's account, which we shall come to, that prompted many French writers to give 1733 as the date of Cantillon's death, though this does not explain how R. Gonnard Histoire des doctrines de La Population, (Paris, 1923), p. 142 makes 1735 out of it. Other authors have taken upon themselves to alter the date of publication of the Essai, thus J. Bonar Philosophy and Political Economy (London, 1893), p. 106 writes 1752, while E. S. Furniss The Position of the labourer in a system of nationalism (New York, 1920), p. 162ff writes 1736. P. Harsin Les doctrines monétaires et financières en France du XVIe au XVIIIe Siecle (Paris 1928), finds a simple solution to the problem as to who finally published the Essai by attributing the deed to Eleazar Mauvillon, of whom we know only that he took the Essai, which was published in 1755, and reprinted it a year later together with his translation of Hume's Political Discourses; this action itself contradicts the assumption that he had brought out the first edition of the Essai a year earlier. No less unfounded is the statement of H. R. Sewall The Theory of Value Before Adam Smith (New York, 1901), p. 80 that Cantillon was of French origin or that of R. Legrand, in his frequently cited work, that Cantillon had personally visited all the countries which he mentions in his Essai.
65. Les doctrines monétaires etc., p. 228n. Huart (op. cit., May 17, p.5) comments that it is quite remarkable that the "Procès-Verbaux du Conseil du Commerce et du bureau du Commerce 1700-1791," published by Bonnjostieux and Lelong, contains nothing about Cantillon.
66. For the convenience of those who are familiar with the Cantillon literature, it may be pointed out that in what follows the available data concerning both the author and Essai are plagiarism by Postlethwayt, the plagiarism of Serionne (see footnotes 83 and 86) and the connection with Montesquieu (see footnote 93).
67. H. Thirrion, La vie privée des financièrs au XVIIIe siècle (Paris, 1895); Cornelis de Will, La Société francaise et la Société anglaise au XVIIIe siècle (Paris, 1864); J. H. Hesse, Memories of the Pretenders and Their Adherents (London, 1845).
68. See p. 43 ff. 52 and 71 of the third volume of the complete edition, undertaken by Maurice Tourneaux, of Correspondence littéraire, philosophique et critique par Grimm, Diderot, Raynal, Meister etc. (Paris, 1878).
70. Biographie Universelle Ancienne et Moderne... Nouvelle edition, publiée sous la direction de M. Michaud, vol. 6 (Paris, 1843), under the false name Philippe de Cantillon. The author of the article is said to be Weiss.
Nouvelle Biographie Générale depuis les temps les plus reculés jusqu'à nos jours, publiée par MM. Firmin Didot Frères sous la direction de Mr. le Dr. Hoefer, vol. 8 (Paris, 1855), similarly under the name Philippe Cantillon.
73. See Complete Peerage of England, Scotland, Ireland, Great Britain and the United Kingdom, extant, extinct or dormant, alphabetically arranged and edited by G. E. C., vol. 7 (London, 1896) p. 217 (Stafford), and vol. 3 (London, 1890), p. 319 (Farnham) as well as Higgs, Economic Journal, vol. 1, p. 288, who points out that the sole surviving child out of the second marriage of Cantillon's daughter, Lady Henrietta Farnham, did not die until 1852. She married the Right Hon. Dennis Daly and was mother of the first Lord Dunsandle, whose descendants are the direct representatives of Cantillon. I mention this here, because this clue could perhaps one day help to add to the little that we now know about Cantillon.
The quotation from Cantillon, which precedes this comment, is from p. 107 of the Essai, beginning with "le nombre des habitants" and continuing to the end of the paragraph on the following page.
76. Alfred Stern, Das Leben Mirabeaus (Berlin, 1889), vol. 1, p. 26, who says that "a very considerable influence on the development of his ideas was exercised by Cantillon's "Essai sur la nature du commerce en général," with which he was familiar in manuscript form for a long time before its publication."
78. See the frequently cited article in the Economic Journal, vol. 1, (1891), as well as the description of the manuscripts in G. Weulersse, Les Manuscripts Economiques de Francois Quesnay et du Marquis de Mirabeau aux Archives Nationales (Paris, 1910), p. 2 ff.
80. In the light of these documents we can only be amused when L. Brocard in his book about Mirabeau's Ami des Hommes (Les doctrines économiques et sociales du Marquis de Mirabeau dans l'Ami des Hommes [Paris, 1902], p. 48), without knowing Higgs's study itself, turns indignantly on R. Legrand because the latter, claiming support from Higgs for what was an extremely cautious comment, had dared to say in his Richard Cantillon, Un mercantilliste precurseur des physiocrates (Paris, 1900), p. 8 that: "one may suspect that the Marquis Mirabeau had the intention of utilizing Cantillon's manuscript and, after touching it up, publishing it under his own name."
83. In France also there was at least one plagiariser at work quite soon after the appearance of the Essai. Accarias de Serionne in his Les Intérêts des Nations de l'Europe dévélopés relativement au Commerce (Leyden, 1766), 2nd. ed. (Paris, 1767) transcribed several passages from the Essai in his second volume (second edition) as follows: In a footnote on p. 127 a verbatim account of living conditions in China, P. 50 ff of the Essai; on p. 135 ff, the exposition on the different value retationships between gold and silver in various countries (p. 364-366 of the Essai); and on p. 148 the account of Newton's point of view at the time of the English coinage reform, not forgetting the erroneous date of 1728, p. 377 of the Essai.
85. The Universal Dictionary of Trade and Commerce, translated from the French of the Celebrated Monsieur Savary... with large additions and Improvements incorporated throughout the whole work which more particularly accommodate the same to the Trade and Navigations of the Kingdoms... by Malachy Postlethwayt (London, 1755), vol. 1, 1751, vol. 2, 1755. See especially the article on "Balance of Trade, Banks, Barter, Cash, Circulation, Coin, Exchange and Interest" in vol. 1 and the articles on "Labour and Money" in vol. 2. The article on "Labour" reproduces verbatim almost the entire contents of chapter 2 and chapters 7-11 of the first part of the Essai.
86. A dissertation on the "Plan, Use and Importance" of the Universal Dictionary of Trade and Commerce, translated from the French... Addressed to the Nobility, Gentry, Merchants and of Great Britain (London, 1749).
87. In the example in which the relative shares of labour and material in the value of a watch spring, which in the French text are obviously incorrectly given as "un a on" (p. 35) are correctly given in the above source as "one to a million." The fact that Postlethwayt in his earlier mentioned work, "Great Britain's True Systems" (London, 1757), p. 154 gives the exact proportion of 1:1,538,460 prompted Cannan (84) to ask if Postlethwayt didn't in fact possess the lost appendix, a question that cannot be answered.
89. H. Higgs Economic Journal, vol. 1:284 bases this account on a character reference found together with the records of the law suit Carol against Cantillon (Bibliotheque Nationale, Fm. 2740, 2838), to which we shall shortly refer. The details which follow are derived from Higgs.
90. Letters Historiques, Politiques, Philosophiques et Particulières de Henri Saint John Bolingbroke depuis 1710 jusqu'à 1736, edited by Grimoard, (Paris, 1808), vol. 2m:452 and 455, Letters to Abbe Alari (2 and 3 February 17-18).
91. This account is based partly on Higgs and partly on the articles on Bulkeley and Clare in the "Dictionaire généalogique, chronologique et histoirique... par M.D.L.C.D.B". (Francois Alexandre Aubert de la Chesnay-Des-Bois) (Paris, 1757), vol. 1. According to the latter source Daniel Mahoni was "comte titulaire de Castilie, par dou du feu roi Philippe V. lieutenant-general des ses armées."
92. If the account of the said "Dictionaire généalogique" is correct, Higgs assumes that the Francois Bulkeley, whom Cantillon's widow married, was her maternal cousin. Bearing in mind what shall be said in the text concerning Bulkeley, it is worth setting out what data I could collect about his life:
Born in London on September 11, 1686, son of Henry Bulkeley, who was land steward (Haushofmeister) to Charles II and James II, brother of the second Viscount Bulkeley. He came to France in 1700, advanced in service under Marshall Berwick to doe rank of lieutenant-general, took part in the unsuccessful expedition of the "Old Pretender" to Scotland in 1715/16, on which occasion he and the son of Berwick were to convey a large sum of money to the "Old Pretender." He died on January 14, 1756, having been permitted to hand over his Irish infantry regiment to his son. Based on Memoirs du Maréchal de Berwick,—ecrits par lui même—vol. 2 (en Suisse, 1778), pp. 169, 172 and Lettres historiques, politiques, philosophiques et particulieres du Henri Saint-John, Lord Viscomte Bolingbroke, depuis 1710 jusqu'en 1736, edited by Grimoard, vol. 3 (Paris, 1808), p. 132n.
93. See Correspondance de Montesquieu publiee par Francois Gebalin et André Morize (Paris, 1914), two volumes. The first letter from Bulkeley to Montesquieu is dated September 10, 1723, the last September 20, 1751. Madame Bulkeley is mentioned for the first time by Montesquieu in a letter written in May or June 1740 and for the last time on July 22, 1749, when, in a letter to Bulkeley, he wrote that he had just spoken with Mme. Bulkeley. As early as July 18, 1736, however, Montesquieu wrote to Bulkeley: "Faites ma cour a Mme. de Cantillon."
96. See the two folio volumes in the bibliothèque nationale, Paris, fm 2740 and 2838, printed chez Andre Knapen (Paris, 1730). See Higgs, Economic Journal (1891), p. 284, and Quarterly Journal of Economics, vol, 6:438 (1892), p. 438.
97. Huart (loc. cit. article of July 26) also considered or considers that the influence of Cantillon on Hume was very great. A. E. Monroe, on the other hand (loc. cit., p. 228) is of the opinion that there are no grounds for assuming that Hume was familiar with Cantillon's manuscript, even though it is known that it passed through many hands.
98. See also L. Cossa, An Introduction to the Study of Political Economy (London, 1893), p. 255, who says that "Hume's Political Discourses... don't stand comparison in terms of coherency or unity with Cantillon's more concise, systematic and thorough exposition."
99. J. Hill Burton, Life and Correspondence of David Hume (Edinburgh 1846). p. 367. This contains only excerpts from Hume's economic writings. Mr. J. Y. T. Greig, who, as literary executor, is preparing a complete edition for the press, had the extraordinary kindness to send me the full text by Hume, and I find that it contains no further indications of a direct influence of Cantillon on Hume.
104. Delle leggi politiche a economiche "Scienza della legislazione II," (1780), reprinted in Scrittori Classici Italiani, di Economia Politica, edited by Custodi, Parte Moderna, vol. 32. See chap. 4.