Legal philosopher and writer on many economic, constitutional and prison reform issues; founder of the UK utilitarian school of philosophy Educated at Westminster School, Queen’s College, Oxford (which he hated, leading him to inspire the opening of University College London in 1828), and Lincoln’s Inn, London, where he read for the English Bar. He is most famous for his exposition of UTILITARIANISM, the principle that there should be a ‘felicific calculus’, to see if a course of action promotes the greatest happiness for the greatest number. This inspired JEVONS in his subjective value theory of exchange. John Stuart MILL, who was much under Bentham’s influence in his youth, rebelled against the cold rationality of utilitarianism.
Bentham studied political economy from 1786 to 1804, between the ages of 38 and 56, when he was at his intellectual peak. A reading of SMITH’SThe Wealth of Nations was decisive for his economic thinking, although he had an earlier interest in unemployment, With an atomistic view of social life, it was not surprising that he used induction as his principal approach and only resorted to mathematics as a convenient method of expression. His first work on economics, Defence of Usury (1787), was inspired by a rumour that the legal maximum for interest was to fall from 5 per cent to 4 per cent: Bentham recommended that there should be free determination of interest rates. Although the work did not advance a theory of the rate of interest, it was nevertheless widely praised in the UK, France and the USA.
He was against artificial attempts to increase trade, e.g.
by having colonies, because he believed that trade is limited by capital. His Manual of Political Economy (1793–5) dealt with international trade. He took to public finance in Supply without Burthen (1795) in which he combined a minimal view of the state with a new proposal to raise the small amount of taxation still necessary—the public auction of all properties in vacant possession because no relatives were alive to inherit. Further, in A Plan for Augmentation of the Revenue (1794–5), he proposed a reduction in the national debt by the use of government-run lotteries and government dealings in life annuities. His Proposal for the Circulation of a New Species of Paper Currency (1795–6) argued that a govern ment monopoly on the issue of paper currency is a cheaper form of government borrowing than the issue of interest-bearing bills. Circulating Annuities (1800) also suggested a new type of paper currency, and in True Alarm (1801) he contributed to the raging BULLIONIST CONTROVERSY of the period by tracing the effects of excessive country bank issues on prices, as well as enunciating a theory of value based on utility Of the Balance of Trade (1801) attacked MERCANTILISM, Defence of a Maximum (1801) advocated price controls for grain and Institute of Political Economy (1801–4) set out his views on the role and limits of government policy, as well as discussing whether political economy is an art or a science.
References
Dinwoody, J. (1989) Bentham, Oxford: Oxford University Press.
Stark, W. (1955) Jeremy Bentham’s Economic Writings, London: Allen & Unwin.
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