Principles of Economics, Vol. 1 (Hardbound - 2022)

Alfred Marshall dominated the world of Economics from about 1890 until his death in 1924. In his most important book, Principles of Economics, he emphasized that the price and output of a good are determined by both supply and demand: the two curves are like scissor blades that intersect at equilibrium. His primary concern in Principles was Microeconomics, the study of Individual markets and industries, and not the whole economy. Modern economists, trying to understand why the price of a good changes, still start by looking for factors that may have shifted demand or supply—an approach they owe to Marshall.

Marshall used the tools of classical mechanics, including the concept of optimization, to make Economics dynamic rather than static. Like neo-classical economists who have followed in his footsteps, Marshall took technology, market institutions, and people’s preferences as given. However he believed that “the Mecca of the economist lies in economic biology rather than in economic dynamics.” The economy, according to him, is an evolutionary process in which technology, market institutions, and people’s preferences evolve along with people’s behaviour.

Principles of Economics, first published in 1890, went through eight editions and is considered the most important treatise of 19th century and beyond. It gave some landmark concepts like consumer surplus, producer surplus, price elastiaty of demand, and the idea of three periods, viz. market period, short period and long period. The concept of National Dividend given in the Principles is not a mere academic toy, but a practical instrument of great power designed for service in the concrete solution of social problems. Marshall’s theoretic discussion follows the lines of the mathematical treatment of Cournot and others, more particularly in his discussion of the doctrines of value, cost, exchange, and distribution. He has used diagrams and formulae for purposes of illustration and for greater precision of statement.

This reprint of the book with a comprehensive Introduction has been brought to help the students, teachers and researchers of Economics in their academic pursuits, and for the economists to delve deeply into the subject and draw valuable conclusions for future progress of society.

Alfred Marshall was born in London on 26 July, 1842. He grew up in the London suburb of Clapham and was educated in a school in Northwood and later at St John’s College, Cambridge. He is regarded as one of the greatest neo-classical economists in England, who dominated economic thinking from the 1890s to the 1930s through his teaching in Cambridge and his book Principles of Economics.

In 1875, after returning from a study of trade protection in the United States, he became increasingly interested in the study of Political Economy. He became the First Principal at University College, Bristol, where he lectured on the subject.

While Marshall was busy writing the Principles, he put in a good deal of effort into testimony before the Gold and Silver Commission, and in the 1890s he was closely associated with the Royal Commission on Labour. Alfred Marshall’s other major works include the following books: Elements of Economics of Industry (1892); Industry and Trade (1919); and Money, Credit and Commerce (1923).

Marshall left a great legacy by teaching as Professor of Economics in Cambridge to a generation of economists, including A.C. Pigou and J.M. Keynes. These students are a testimony to Marshall’s greatness as a thinker,

teacher, philanthropist and, above all, as an economist.

R.N. Ghosh is currently a Senior Honorary Research Fellow at the University of Western Australia in Perth, Australia. He is a specialist in the history of economic thought. In recent years he has also published on topics relating to a wide range of development issues such as good governance, corruption, gender issues, the environment, and the role of tourism in economic change. He is the current chairman of the International Institute for Development Studies (IIDS-Australia). Professor Ghosh has recently published with Atlantic Publishers and Distributors (P) Ltd., South Asian reprints of (i) Adam Smith’s An Inquiry into the Nature and Causes of the Wealth of Nations, 2 Vols.; (ii) J.M. Keynes’ General Theory of Employment, Interest and Money; and (iii) David Ricardo’s The Principles of Political Economy and Taxation, A prolific writer, he has contributed papers in a wide range of scholarly international journals.