John A. Hobson
Encyclopedia
John Atkinson Hobson commonly known as John A. Hobson or J. A. Hobson, was an English economist
and critic of imperialism
, widely popular as a lecturer and writer.
, the son of William Hobson, 'a rather prosperous newspaper proprietor,' and Josephine Atkinson. He was the brother of the mathematician Ernest William Hobson
. He studied at Derby School
and Lincoln College, Oxford
, afterwards teaching classics and English literature at schools in Faversham
and Exeter
.
When Hobson moved to London in 1887, England was in the middle of a major economic depression. While classical economics was at a loss to explain the vicious business cycles, London was awash in societies and clubs that proposed alternatives. While living in London, Hobson was exposed to the Social Democrats and Henry Mayers Hyndman, Christian Socialists, and Henry George
's 'One-Tax' system. He befriended several of the prominent Fabians who would found the London School of Economics
, some of whom he had known at Oxford
. However, none of these groups proved persuasive enough for Hobson; rather it was his collaboration with a friend, the famous businessman and mountain climber Albert F. Mummery
, that would produce Hobson's contribution to economics: the theory of underconsumption
. First outlined by Mummery and Hobson in the 1889 book, 'Physiology of Industry', underconsumption was a scathing indictment of Say's Law
and classical economics
' emphasis on thrift
. The forwardness of the book's conclusions discredited Hobson among the professional economics community. Ultimately he was pushed out of the academic community.
During the very late 19th-century his notable works included Problems of Poverty (1891), Evolution of Modern Capitalism (1894), Problem of the Unemployed (1896) and John Ruskin: Social Reformer (1898). They developed Hobson's famous critique of the classical theory of rent
and his proposed generalization anticipated the Neoclassical "marginal productivity" theory of distribution
.
Soon after this period Hobson was recruited by the editor of the Manchester Guardian to be their South-African correspondent. During his coverage of the Second Boer War
, Hobson began to form the idea that imperialism was the direct result of the expanding forces of modern capitalism
. He believed the mine owners, with Cecil Rhodes, who wanted control of the Transvaal
, in the vanguard, were manipulating the British into fighting the Boers so that they could maximize their profits from mining. His return to England was marked by his strong condemnation of the conflict.
His publications in the next few years demonstrated an exploration of the links between imperialism and international conflict. These works included War in South Africa (1900) and Psychology of Jingoism (1901). In what is arguably his magnum opus, Imperialism
(1902), he espoused the opinion that imperial expansion is driven by a search for new markets and investment opportunities overseas. Imperialism gained Hobson an international reputation, and influenced such notable thinkers as Lenin, Trotsky and Hannah Arendt
's The Origins of Totalitarianism
(1951).
Hobson wrote for several other journals before writing his next major work, The Industrial System (1909). In this tract he argued that maldistribution of income led, through oversaving and underconsumption
, to unemployment and that the remedy lay in eradicating the "surplus" by the redistribution of income through taxation and the nationalization of monopolies.
Hobson's opposition to the First World War led him to join the Union of Democratic Control
. His advocacy for the formation of a world political body to prevent wars can be found clearly in his piece Towards International Government (1914). However, he was staunchly opposed to the League of Nations
.
The year 1919 saw Hobson joining the Independent Labour Party
. This was shortly followed by writings for socialist publications such as the New Leader, the Socialist Review and the New Statesman
. During this period it became clear that Hobson favoured capitalist reformation over communist revolution. He was a notable critic of the Labour Government of 1929.
In the later years of his life, Hobson published his autobiography, Confessions of an Economic Heretic (1938), and expressed hope that the USA would join World War Two. Hobson died before the German air force attacked British skies.
and Ronald Robinson
in their 1953 article The Imperialism of Free Trade would argue that Hobson placed too much emphasis on the role of formal empire and directly ruled colonial possessions, not taking into account the significance of trading power, political influence and informal imperialism. They also argued that the difference in British foreign policy that Hobson observed between the mid-Victorian indifference to empire that accompanied free market economics, and the later high imperialism seen after 1870, was not in fact a reality.
P.J.Cain and A.G.Hopkins, writing in the 1980s attacked Hobson's focus on industrial capitalism as the driving force of imperialism. They advanced the theory of 'gentlemanly capitalism
', arguing that the traditional landed aristocracy was responsible for the growth of the early, mercantilist empire, and controlled later imperialism with their domination of capital and through financial institutions in the City of London
. In their view, Hobson placed too much emphasis on the industrial revolution
in relation to Imperialism, failing to explain earlier European expansion.
Economist
An economist is a professional in the social science discipline of economics. The individual may also study, develop, and apply theories and concepts from economics and write about economic policy...
and critic of imperialism
Imperialism
Imperialism, as defined by Dictionary of Human Geography, is "the creation and/or maintenance of an unequal economic, cultural, and territorial relationships, usually between states and often in the form of an empire, based on domination and subordination." The imperialism of the last 500 years,...
, widely popular as a lecturer and writer.
Life
John Atkinson Hobson was born in DerbyDerby
Derby , is a city and unitary authority in the East Midlands region of England. It lies upon the banks of the River Derwent and is located in the south of the ceremonial county of Derbyshire. In the 2001 census, the population of the city was 233,700, whilst that of the Derby Urban Area was 229,407...
, the son of William Hobson, 'a rather prosperous newspaper proprietor,' and Josephine Atkinson. He was the brother of the mathematician Ernest William Hobson
E. W. Hobson
Ernest William Hobson FRS was an English mathematician, now remembered mostly for his books, some of which broke new ground in their coverage in English of topics from mathematical analysis...
. He studied at Derby School
Derby School
Derby School was a school in Derby in the English Midlands from 1160 to 1989. It had an almost continuous history of education of over eight centuries. For most of that time it was a grammar school for boys. The school became co-educational and comprehensive in 1974 and was closed in 1989...
and Lincoln College, Oxford
Lincoln College, Oxford
Lincoln College is one of the constituent colleges of the University of Oxford in the United Kingdom. It is situated on Turl Street in central Oxford, backing onto Brasenose College and adjacent to Exeter College...
, afterwards teaching classics and English literature at schools in Faversham
Faversham
Faversham is a market town and civil parish in the Swale borough of Kent, England. The parish of Faversham grew up around an ancient sea port on Faversham Creek and was the birthplace of the explosives industry in England.-History:...
and Exeter
Exeter
Exeter is a historic city in Devon, England. It lies within the ceremonial county of Devon, of which it is the county town as well as the home of Devon County Council. Currently the administrative area has the status of a non-metropolitan district, and is therefore under the administration of the...
.
When Hobson moved to London in 1887, England was in the middle of a major economic depression. While classical economics was at a loss to explain the vicious business cycles, London was awash in societies and clubs that proposed alternatives. While living in London, Hobson was exposed to the Social Democrats and Henry Mayers Hyndman, Christian Socialists, and Henry George
Henry George
Henry George was an American writer, politician and political economist, who was the most influential proponent of the land value tax, also known as the "single tax" on land...
's 'One-Tax' system. He befriended several of the prominent Fabians who would found the London School of Economics
London School of Economics
The London School of Economics and Political Science is a public research university specialised in the social sciences located in London, United Kingdom, and a constituent college of the federal University of London...
, some of whom he had known at Oxford
Oxford
The city of Oxford is the county town of Oxfordshire, England. The city, made prominent by its medieval university, has a population of just under 165,000, with 153,900 living within the district boundary. It lies about 50 miles north-west of London. The rivers Cherwell and Thames run through...
. However, none of these groups proved persuasive enough for Hobson; rather it was his collaboration with a friend, the famous businessman and mountain climber Albert F. Mummery
Albert F. Mummery
Albert Frederick Mummery , was an English mountaineer and author. Although most notable for his many and varied first ascents put up in the Alps, Mummery, along with J...
, that would produce Hobson's contribution to economics: the theory of underconsumption
Underconsumption
In underconsumption theory in economics, recessions and stagnation arise due to inadequate consumer demand relative to the amount produced. The theory has been replaced since the 1930s by Keynesian economics and the theory of aggregate demand, both of which were influenced by...
. First outlined by Mummery and Hobson in the 1889 book, 'Physiology of Industry', underconsumption was a scathing indictment of Say's Law
Say's law
Say's law, or the law of market, is an economic principle of classical economics named after the French businessman and economist Jean-Baptiste Say , who stated that "products are paid for with products" and "a glut can take place only when there are too many means of production applied to one kind...
and classical economics
Classical economics
Classical economics is widely regarded as the first modern school of economic thought. Its major developers include Adam Smith, Jean-Baptiste Say, David Ricardo, Thomas Malthus and John Stuart Mill....
' emphasis on thrift
Frugality
Frugality is the quality of being frugal, sparing, thrifty, prudent or economical in the use of consumable resources such as food, time or money, and avoiding waste, lavishness or extravagance....
. The forwardness of the book's conclusions discredited Hobson among the professional economics community. Ultimately he was pushed out of the academic community.
During the very late 19th-century his notable works included Problems of Poverty (1891), Evolution of Modern Capitalism (1894), Problem of the Unemployed (1896) and John Ruskin: Social Reformer (1898). They developed Hobson's famous critique of the classical theory of rent
Economic rent
Economic rent is typically defined by economists as payment for goods and services beyond the amount needed to bring the required factors of production into a production process and sustain supply. A recipient of economic rent is a rentier....
and his proposed generalization anticipated the Neoclassical "marginal productivity" theory of distribution
Income distribution
In economics, income distribution is how a nation’s total economy is distributed amongst its population.Income distribution has always been a central concern of economic theory and economic policy...
.
Soon after this period Hobson was recruited by the editor of the Manchester Guardian to be their South-African correspondent. During his coverage of the Second Boer War
Second Boer War
The Second Boer War was fought from 11 October 1899 until 31 May 1902 between the British Empire and the Afrikaans-speaking Dutch settlers of two independent Boer republics, the South African Republic and the Orange Free State...
, Hobson began to form the idea that imperialism was the direct result of the expanding forces of modern capitalism
Capitalism
Capitalism is an economic system that became dominant in the Western world following the demise of feudalism. There is no consensus on the precise definition nor on how the term should be used as a historical category...
. He believed the mine owners, with Cecil Rhodes, who wanted control of the Transvaal
South African Republic
The South African Republic , often informally known as the Transvaal Republic, was an independent Boer-ruled country in Southern Africa during the second half of the 19th century. Not to be confused with the present-day Republic of South Africa, it occupied the area later known as the South African...
, in the vanguard, were manipulating the British into fighting the Boers so that they could maximize their profits from mining. His return to England was marked by his strong condemnation of the conflict.
His publications in the next few years demonstrated an exploration of the links between imperialism and international conflict. These works included War in South Africa (1900) and Psychology of Jingoism (1901). In what is arguably his magnum opus, Imperialism
Imperialism (Hobson)
Imperialism: A Study was a political-economic discourse written by John A. Hobson in 1902.The "taproot of imperialism" is not found in nationalistic pride, but capitalist oligarchy...
(1902), he espoused the opinion that imperial expansion is driven by a search for new markets and investment opportunities overseas. Imperialism gained Hobson an international reputation, and influenced such notable thinkers as Lenin, Trotsky and Hannah Arendt
Hannah Arendt
Hannah Arendt was a German American political theorist. She has often been described as a philosopher, although she refused that label on the grounds that philosophy is concerned with "man in the singular." She described herself instead as a political theorist because her work centers on the fact...
's The Origins of Totalitarianism
The Origins of Totalitarianism
The Origins of Totalitarianism is a book by Hannah Arendt which describes and analyzes the two major totalitarian movements of the twentieth century, Nazism and Stalinism...
(1951).
Hobson wrote for several other journals before writing his next major work, The Industrial System (1909). In this tract he argued that maldistribution of income led, through oversaving and underconsumption
Underconsumption
In underconsumption theory in economics, recessions and stagnation arise due to inadequate consumer demand relative to the amount produced. The theory has been replaced since the 1930s by Keynesian economics and the theory of aggregate demand, both of which were influenced by...
, to unemployment and that the remedy lay in eradicating the "surplus" by the redistribution of income through taxation and the nationalization of monopolies.
Hobson's opposition to the First World War led him to join the Union of Democratic Control
Union of Democratic Control
The Union of Democratic Control was a British pressure group formed in 1914 to press for a more responsive foreign policy. While not a pacifist organization, it was opposed to military influence in government.-World War I:...
. His advocacy for the formation of a world political body to prevent wars can be found clearly in his piece Towards International Government (1914). However, he was staunchly opposed to the League of Nations
League of Nations
The League of Nations was an intergovernmental organization founded as a result of the Paris Peace Conference that ended the First World War. It was the first permanent international organization whose principal mission was to maintain world peace...
.
The year 1919 saw Hobson joining the Independent Labour Party
Independent Labour Party
The Independent Labour Party was a socialist political party in Britain established in 1893. The ILP was affiliated to the Labour Party from 1906 to 1932, when it voted to leave...
. This was shortly followed by writings for socialist publications such as the New Leader, the Socialist Review and the New Statesman
New Statesman
New Statesman is a British centre-left political and cultural magazine published weekly in London. Founded in 1913, and connected with leading members of the Fabian Society, the magazine reached a circulation peak in the late 1960s....
. During this period it became clear that Hobson favoured capitalist reformation over communist revolution. He was a notable critic of the Labour Government of 1929.
In the later years of his life, Hobson published his autobiography, Confessions of an Economic Heretic (1938), and expressed hope that the USA would join World War Two. Hobson died before the German air force attacked British skies.
Criticism
Later historians would attack Hobson, and the Marxist theories of imperialism he influenced. Notably, John GallagherJohn Andrew Gallagher
John "Jack" Andrew Gallagher, FBA was a distinguished historian of the British Empire who between 1963 and 1970 held the Beit Professorship of Commonwealth History at the University of Oxford and from 1971 until his death was the Vere Harmsworth Professor of Imperial and Naval History at the...
and Ronald Robinson
Ronald Robinson
Ronald "Robbie" Edward Robinson, FBA was a distinguished historian of the British Empire who between 1971 and 1981 held the Beit Professorship of Commonwealth History at the University of Oxford....
in their 1953 article The Imperialism of Free Trade would argue that Hobson placed too much emphasis on the role of formal empire and directly ruled colonial possessions, not taking into account the significance of trading power, political influence and informal imperialism. They also argued that the difference in British foreign policy that Hobson observed between the mid-Victorian indifference to empire that accompanied free market economics, and the later high imperialism seen after 1870, was not in fact a reality.
P.J.Cain and A.G.Hopkins, writing in the 1980s attacked Hobson's focus on industrial capitalism as the driving force of imperialism. They advanced the theory of 'gentlemanly capitalism
Gentlemanly capitalism
Gentlemanly capitalism is a theory of New Imperialism first put forward by Cain and Hopkins in their 1993 work, British Imperialism. The theory posits that the New Imperialism of the late 19th century was driven by the business interests of the City of London and landed interests.*Theories of New...
', arguing that the traditional landed aristocracy was responsible for the growth of the early, mercantilist empire, and controlled later imperialism with their domination of capital and through financial institutions in the City of London
City of London
The City of London is a small area within Greater London, England. It is the historic core of London around which the modern conurbation grew and has held city status since time immemorial. The City’s boundaries have remained almost unchanged since the Middle Ages, and it is now only a tiny part of...
. In their view, Hobson placed too much emphasis on the industrial revolution
Industrial Revolution
The Industrial Revolution was a period from the 18th to the 19th century where major changes in agriculture, manufacturing, mining, transportation, and technology had a profound effect on the social, economic and cultural conditions of the times...
in relation to Imperialism, failing to explain earlier European expansion.
Book-length works
- The Physiology of Industry (written with Albert F. MummeryAlbert F. MummeryAlbert Frederick Mummery , was an English mountaineer and author. Although most notable for his many and varied first ascents put up in the Alps, Mummery, along with J...
) (1889). - Problems of Poverty (1891).
- Evolution of Modern Capitalism (1894).
- Problem of the Unemployed (1896).
- John Ruskin: Social Reformer (1898).
- The Economics of Distribution (1900).
- The War in South Africa: Its Causes and Effects (1900).
- Psychology of Jingoism (1901).
- The Social Problem (1901).
- ImperialismImperialism (Hobson)Imperialism: A Study was a political-economic discourse written by John A. Hobson in 1902.The "taproot of imperialism" is not found in nationalistic pride, but capitalist oligarchy...
(1902). - International Trade (1904).
- Canada Today (1906).
- The Crisis of Liberalism (1909).
- The Industrial System (1909).
- A Modern Outlook (1910).
- The Science of Wealth (1911).
- An Economic Interpretation of Investment (1911).
- Industrial Unrest (1912).
- The German Panic (1913).
- Gold, Prices and Wages (1913).
- Work and Wealth, A Human Valuation (1914).
- Traffic in Treason, A Study in Political Parties (1914).
- Towards International Government (1915).
- Western Civilization (1915).
- The New Protectionism (1916).
- Labour and the Costs of War (1916).
- Democracy after the War (1917).
- Forced Labor (1917).
- 1920: Dips into the Near Future (1917/1918).
- Taxation and the New State (1919).
- Richard Cobden: The International Man (1919).
- The Obstacles to Economic Recovery in Europe (1920).
- The Economics of Restoration (1921).
- Problems of a New World (1921).
- Incentives in the New Industrial Order (1922).
- The Economics of Unemployment (1922).
- Notes on Law and Order (1926).
- The Living Wage (with H. N. BrailsfordH. N. BrailsfordHenry Noel Brailsford was the most prolific British left-wing journalist of the first half of the 20th century.The son of a Methodist preacher, he was born in Yorkshire and educated in Scotland, at the High School of Dundee...
, A. Creech Jones, E.F. Wise) (1926). - The Conditions of Industrial Peace (1927).
- Wealth and Life (1929).
- Rationalisation and Unemployment (1930).
- God and Mammon (1931).
- Poverty in Plenty (1931).
- L.T. Hobhouse, His Life and Work (1931).
- The Recording Angel (1932).
- Saving and Spending: Why Production is Clogged (1932).
- From Capitalism to Socialism (1932).
- Rationalism and Humanism (1933).
- Democracy and a Changing Civilization (1934).
- Veblen (1936).
- Property and Improperty (1937).
- Le Sens de la responsibilité dans la vie sociale (with Herman Finer and Hanna Mentor) (1938).
- Confessions of an Economic Heretic (1938).
External links
- http://www.spartacus.schoolnet.co.uk/TUhobson.htm
- Hobson Internet Archive Key site for Hobson texts, including the full text of Imperialism.
- Excerpts from Imperialism. http://www.fordham.edu/halsall/mod/1902hobson.html