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'Arthur Cecil Pigou' (November 18, 1877 – March 7, 1959) was an English economist, known for his work in many fields and particularly in welfare economics. He served on a number of royal commissions including the 1919 commission on income tax.

Contents

Education

Life and work

Major publications

See also

External links

Education

Arthur Cecil Pigou went to Harrow School(Newlands House) and graduated from King's College, Cambridge, where he studied under Alfred Marshall, whom he later succeeded as professor of political economy.
As Marshall's prize student and designated heir, Pigou personified the Cambridge Neoclassicals — the heart of the Marshallian orthodoxy in the first third of the century.

Life and work

His major work, ''Wealth and Welfare'' (1912, 1920), brought welfare economics into the scope of economic analysis. In particular, Pigou is responsible for the distinction between private and social marginal products and costs. He originated the idea that governments can, via a mixture of taxes and subsidies, correct such market failures — or "internalize the externalities". Pigovian taxes, taxes used to correct negative externalities, are named in his honor.
This approach came under attack from Lionel Robbins and Frank Knight. The New Welfare Economics that arose in the late 1930s dispensed with much of Pigou's analytical toolbox. Later, the Public Choice theorists rejected Pigou's approach for its naive "benevolent despot" assumption. Finally, Ronald Coase demonstrated that efficient outcomes could be generated without government intervention when property rights are clearly defined. Coase presents his case in the article "The Problem of Social Cost" (1960 — see Coase Theorem).
In the ''The General Theory of Employment, Interest, and Money'', John Maynard Keynes held up Pigou's ''Theory of Unemployment'' (1933) as the example of everything that was wrong with Neoclassical macroeconomics. He never quite recovered from the shock of being betrayed by his old colleague and friend. The rest of Pigou's life was spent occasionally counterattacking (e.g. with the "Pigou Effect" ("The Classical Stationary State", 1943) or submitting to the "Keynesian Revolution".
Pigou was a Professor of Political Economy at Cambridge University from 1908 to 1943.

Major publications

★ ''Robert Browning as a Religious Teacher'', 1901.

★ ''Tariffs'', 1903.

★ "Monopoly and Consumers' Surplus", 1904, ''EJ''.

★ ''Industrial Peace'', 1905.

★ ''Import Duties'', 1906.

★ "Review of the Fifth Edition of Marshall's Principles of Economics", 1907, ''EJ''.

★ "Producers' and Consumers' Surplus", 1910, ''EJ''.

★ ''Wealth and Welfare'', 1912.

★ ''Unemployment'', 1914.

★ "The Value of Money", 1917, ''QJE''.

★ ''The Economics of Welfare'', 1920.

★ "Empty Economic Boxes: A reply", 1922, ''EJ''.

★ ''The Political Economy of War'', 1922.

★ "Exchange Value of Legal Tender Money", 1922, in: ''Essays in Applied Economics''.

★ ''Essays in Applied Economics'', 1923.

★ ''Industrial Fluctuations'', 1927.

★ "The Law of Diminishing and Increasing Cost", 1927, ''EJ''.

★ ''A Study in Public Finance'', 1928.

★ "An Analysis of Supply", 1928, ''EJ''.

★ ''The Theory of Unemployment'', 1933.

★ ''The Economics of Stationary States'', 1935.

★ "Mr. J.M. Keynes's General Theory", 1936, ''Economica''.

★ "Real and Money Wage Rates in Relation to Unemployment", 1937, ''EJ''.

★ "Money Wages in Relation to Unemployment", 1938, ''EJ''.

★ ''Employment and Equilibrium'', 1941.

★ "The Classical Stationary State", 1943, ''EJ''.

★ ''Lapses from Full Employment'', 1944.

★ "Economic Progress in a Stable Environment", 1947, ''Economica''.

★ ''The Veil of Money'', 1949.

★ ''Keynes's General Theory: A retrospective view'', 1951.

★ ''Essays in Economics'', 1952.

See also

★ Pigovian tax

★ Pigou effect

External links

★ Profile of Arthur Cecil Pigou at the History of Economic Thought website.

★ Link to free online copy of "The Economics of Welfare" at the Library of Economics and Liberty