Edwin Cannan: Author of “The Wealth of Nations”
Edwin Cannan was an economist from Britain who wrote “The Wealth of Nations.” The book, published in 1904, helped to set the tone for what economists today call “the tragedy of commons.”
Cannan was a professor at Oxford who inherited a fortune that allowed him time to be something of a professional philosopher. He dabbled around London, learning how the economy worked and how its individuals invested and profited from those workings.
Cannan’s work didn’t draw much scrutiny during his lifetime. He’d attempted criticisms of Marshall and Keynes, but neither had really fallen on enthusiastic ears. He’d also written a host of works, none of which were well-received.
The trouble was that Cannan’s ideas were not very popular, almost stinging in their honesty. Cannan articulated an idea first put forth by Garret Hardin. He argued that when people acted according to their own self-interest, they could have catastrophic effects on the group. Except that Cannan’s version put a twist on this idea. He argued that the higher an area’s land values, the more public works that area was likely to have and therefore the lower quality of the workforce that area was likely to attract. If taxation is high, there is more money left over for subsidies. This distorts the value of a location. Are taxes high because the city has high property values, or are values high because the city requires higher taxes?
Cannan was considered a classical liberal, something akin to a modern day libertarian. He might not argue for smaller government, but he recognized the benefit of allocating public money.
Samuel Phineas Uphamis an investor from NYC and SF. You may contact Phin on his Samual Phineas Upham website or Twitter page.
