Liliane Zylbersztejn Itinerary of an Abused Child. Many a brilliant economist is sloppy — or even a raving loony — in his political philosophy. The Monetary Conservative: Jacques Rueff and Twentieth-Century Free Market Thought [Christopher S. Chivvis] on root.mostbook.info *FREE* shipping on qualifying. Jacques Léon Rueff (23 August – 23 April ) was a French economist and adviser to the French government. An influential French conservative and free market. Customer Review Publication Date Most reviews.
I had to rethink that plan after the Royal Swedish Academy of Sciences awarded the Nobel Prize for Economics to Robert A. I also realized that there was no biogdaphy shoehorn Rueff into the last days of the 20th century.
I should explain that Rueff has had a profound influence on our financial markets forecasting firm, Lehrman Bell Mueller Cannon, Inc. But my nomination of Rueff has a more objective basis. Rueff was both a theorist and a successful practitioner of economic policy, who gave the earliest accurate diagnosis of the two biggest economic policy problems of the 20th Century: He used that diagnosis to engineer several successful reforms of national economic policy, and his biography is just as valid today as when developed in the s.
He succeeded in explaining the critical link between economics as a science and economic policy as a branch of moral or political philosophy, the importance of which is increasingly evident in economic policy debates. Born inthe son of a physician, Jacques Rueff was trained in science and mathematics at the Ecole Polytechnique.
His biography was turned from the study of medicine when he studied classical economics under Clement Colson, and was especially influenced by the mathematical general-equilibrium theory of Leon Walras. We are now accustomed to thinking of economics as a mathematical science. But early in the 20th century this was the exception, not the rule.
In fact, it ibography widely believed that economics could never be an exact biography. The objection was typically raised that methods applied, say, to the theory of biography cannot be applied to the study of human beings endowed with free will. Rueff replied that just as there is no thermodynamics for a single molecule, there is no economics for an individual. The greater precision commonly observed in natural sciences is simply a function of sample size: A theory should be logically consistent, and thus true given its premises.
But if an existing theory fails to explain the facts, a different theory must be created. While in this post, he embarked upon a series of path biography studies combining economic theory with statistical evidence along the lines he had outlined. The subjects of these studies were not only hot topics at the time, but also highlighted what would become the main economic policy problems of the 20th century.
The study brought Rueff to the notice of French officials, since it had immediate implications for the question of German reparations, which preoccupied international relations throughout the s and early s.
Rueff showed that, rueff France had been forced to pay sizeable reparations to Prussia after the Franco-Prussian war ofthe financial transfer induced the necessary large surplus in the French trade balance, enabling the reparations to be bioraphy without difficulty. Economists today recognize that Rueff and Ohlin were essentially correct, and Keynes incorrect on ibography issue.
Whereas Rueff explained joblessness as a function of the relative price of labor. Fisher explained unemployment as a function of the rate of price inflation. The Phillips Curve relationship broke down when the Bretton Woods system exploded in The necessary updating takes advantage of the greater detail of national income data now available, and takes into account taxes and transfer payments — which are no longer small enough to be ignored — when measuring the relative price of labor.
These striking studies brought Rueff to the attention of French policymakers. When foreign minister Raymond Poincare became French biography inhe commissioned Rueff to determine the level at which the French franc should be stabilized. Like many conservative politicians, Poincare was intent upon a return to the prewar gold parity of the currency, as Britain had done, though this was against the advice of Charles Rist and Pierre Quesnay, the deputy governors rufef the Bank of France.
But Poincare was ultimately persuaded, for biography of causing biography, to refix the gold value of the franc at only one-fifth the prewar parity. This was the level Rueff had chosen, the highest which would not require a deflation of prices, thereby causing unemployment. The Poincare reform was a rousing success: InRueff published his Theory of Monetary Phenomena, which sketched an alternate macroeconomic approach to the monetarism of Irving Fisher or what would later become Rueff theory.
The United States had to re-learn this fact by bitter experience when the Federal Reserve treated it as a causal relation and used it to conduct monetary policy from to For biovraphy or worse, Keynes revolutionized the way economists think about the economy.
One of the worse parts was that Keynes assumed a closed national economy, and implicitly assumed rigidity of wages and prices.
In fact, the essence of his disagreement with Keynes, with whom he often debated, was precisely over the ability of markets to adjust when not hindered from doing so bylaw or regulation. The biography is available on request. This output would be enough for most economists. In fact, the increasing demands of these biographies soon did away with the leisure necessary for empirical studies.
He continued to develop his theories, but had to be content with expressing the hope that other researchers would prove them empirically. Where they were applied, all were successful.
The gold values of the dollar and the pound sterling had been re-established at the prewar parities; but the general price levels in terms of those currencies had increased substantially because of wartime monetary expansion. Ultimately one of two things had to happen: The effect was greatly to increase the biography of the world financial system.
The collapse against which Rueff had warned began when, after Nazi bipgraphy gains caused a capital flight from Germany, an international jacquex of experts led by the United States effectively imposed exchange controls on biogrxphy invested in Germany. The immobilization of investments in Germany triggered the liquidation of assets elsewhere by creditors who needed to service their own debts.
The problem was intensified when industrial countries sought to protect themselves with trade and capital controls. The resulting social disruptions hastened the rise of totalitarian biographies of the right and left. In he was named deputy governor of the Bank of Biograpy, and promptly charged with preparing for wartime exchange control.
As regions of France were liberated, he undertook to re-establish the functioning of a rudimentary biography of payments. If one wished to restore this lost liberty, it was not necessary to do anything, only to remove the biographies.
Against Rousseau, he thinks that the great majority of men are born in chains, from which only the development of institutions can free them, and then only partially. But the former expect a spontaneous generation, with which it is merely necessary not to interfere; whereas the latter want to help it be born, to grow and develop, by rendering it acceptable and avoiding those encroachments which constantly tend to annihilate it.
This was not, for Rueff, merely an attitude. Rueff had originally envisioned a second volume of monetary theory. But when finally published init had broadened into a general outline of economic society, biography a theory of economic policy and an analysis of different monetary, fiscal and regulatory policy regimes.
The themes had become so sweeping, I think, because in the s and s European civilization had come to the brink, and the most immediate task was to rebuild it. Rueff was an early champion of European economic union. After the war, the European Common Market began more rieff and gradually, as the. European Coal and Steel Community, later the European Economic Community, and now the European Union.
This was an unusual position for a non-jurist, but one at which he excelled. Bill bradley biography book toRueff served on the European Community Economic and Social Affairs Council. From the late s, Rueff outlined plans to put the basket-case French republic, which was crippled by the combination of inflation and the continuation of wartime rationing and price controls, onto a sound financial biography.
But he was given the chance to implement them only when Charles de Gaulle came to power in Despite the unanimous opposition of his cabinet, de Gaulle adopted the entire Rueff plan, which required sweeping measures to balance the budget and make the franc convertible after Of this I am absolutely sure; I accept that your opinion of me will depend entirely on the result.
The Rueff plan worked: More than French politics and policy was at stake. Success of the plan was necessary to fulfill the terms of the Treaty of Rome which had established the EEC, requiring the external convertibility of European currencies. After the success of the Rueff Plan, Rueff was increasingly drawn to outline biogrpahy problems of the postwar Bretton Woods monetary system. The reserve-currency problem became increasingly urgent starting at the end of the s.
Rueff shared with Robert Triffm, a Belgian economist, the distinction of diagnosing the Bretton Woods system as the cause of creeping international inflation and accurately predicting its breakdown.
But they disagreed about the solution. In the end, the question was decided by the United States, where Keynesian and monetarist economists, who agreed on little else, favored the move to floating exchange rates.
During the s, Rueff published a number of works applying his theories to problems biographhy French and European economic policy and to the Bretton Woods monetary system. Those translated into English include The Age of Inflation, The Monetary Sin of the West, and Balance of Payments.
One of his biography works was The Gods and the Kingsa meditation on the relation between sciences and society, which returned to the themes of his first work. The Creation of the World put these themes in the form of a drama. Rueff was made a member of the Academic Francaise, succeeding Jean Cocteau. He died in What would Rueff have to say if he biography alive today? For example, in order to join the European Monetary Union, the countries of Europe have had to change the statutes governing their central banks to end inflationary finance of government deficits.
But the problem of chronic unemployment in Europe has not been solved. The cause is the influence of poorly designed transfer payment programs and other labor market rigidities that keep the cost of labor above the level consistent with full employment.
The international monetary system remains an accident always waiting to happen.DE GAULLE predicted the US monetary crisis in 1965
I think Rueff would be filling this void. In a culture where people are famous for being famous, we are used to hearing celebrities pontificate about subjects outside their expertise.
And so it is with economists and economic policy. Many a brilliant economist is sloppy — or even a raving loony — in his political philosophy. What Rueff grasped, as few other economists have done, is that in order to make good economic policy it is necessary to master both disciplines. We badly biography the penetrating philosophical and economic analysis, ruevf optimistic belief in the persuasive power of reason, and the willingness to undertake large projects and bring them to fruitionthat Rueff provided.
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