ALFRED EICHNER, JOAN ROBINSON, ADRIAN WOOD AND THE REVIVAL OF HALL AND HITCH'S LEGACY: A HISTORY OF EICHNER'S “COST-PLUS” ALTERNATIVE TO THE CHAMBERLINE-ROBINSON PRICING MODEL

Theodoro Cesar de Oliveira Sposito

Título do Trabalho

Autores

Theodoro Cesar de Oliveira Sposito

Modalidade

Resumo Expandido (associados AKB)

Área temática

Área 3. Método, teoria econômica e história econômica

Data de Publicação

02/12/2024

País da Publicação

Brasil

Idioma da Publicação

Português

Página do Trabalho

https://www.even3.com.br/anais/akb2024/894340-alfred-eichner-joan-robinson-adrian-wood-and-the-revival-of-hall-and-hitchs-legacy--a-history-of-eichners-co

ISBN

978-65-272-0872-3

Palavras-Chave

Olicopoly; Imperfect Competition; Microeconomic foundation of Macroeconomics; Macrodynamics

Resumo

During the late 1960s and early 1970s, Alfred S. Eichner worked on a theoretical article aiming to demonstrate the relationship between monopolistic practices and inflation. In March 1969, after facing rejections from major American journals such as the American Economic Review and the Quarterly Journal of Economics, Eichner sent a copy of his manuscript to Joan Robinson, initiating an extensive correspondence. This exchange continued until the article’s eventual publication in the Economic Journal in December 1973, under the title “A Theory of the Determination of the Mark-up Under Oligopoly” (EICHNER, 1973). In its final form, the article sought to revive the empirical legacy established by Hall and Hitch (1939). This revival sparked divergent comments and led to a debate within the same journal the following year. While Tim Hazledine (1974) expressed optimism, Romney Robinson (1974), Charles Delorme Jr and Paul H. Rubin (1974) was highly critical. Eichner (1974) responded to both, triggering further discussions in other publications. This paper provides an overview of this previously unexplored debate and reflects on its origins, context, and impact on the formation of a post-Keynesian identity in the early 1970s in the United States. The study draws on extensive archival material and focuses on two main aspects. First, we examine the personal correspondence between Joan Robinson and Alfred Eichner from 1969 to 1972, presenting evidence that Robinson influenced and encouraged Eichner to shift the direction of his original idea. Eichner moved from a theoretical model of price formation in oligopoly to the embryo of a broader microeconomic theory that could serve as a foundation for macroeconomics from the Cambridge (UK) perspective. This explains the combative nature of the manuscript submitted to the Economic Journal. Secondly, we delve into the context surrounding the manuscript’s arbitration through the correspondence between Adrian Wood, one of the reviewers, and the editors of the Economic Journal. We emphasize Adrian Wood’s mediation as a crucial factor in the review and acceptance of the article. Wood’s involvement also played a pivotal role in initiating this debate within the journal, as he also reviewed the comments on the text written by Hazledine and Robinson. The article concludes by reflecting on how this debate aligns with the assertive stance of the emerging post-Keynesian community during its formative years. The study is divided into five specific objectives, each with its own section. Section 1, entitled “A Brief History of the Chamberlin-Robinson versus Cost-plus Debate,” provides an overview and historical context for the debate. The guiding questions for this review are as follows: (i) When did the debate begin? (ii) What were the main theses of the original debate? (iii) What were the developments in the debate that led to the episode with Eichner? Section 2, 'Letters that shaped a theory: Joan Robinson and Eichner’s correspondence',” is based entirely on correspondence between Joan Robinson and Alfred Eichner from 1969 to 1973. These letters illustrate Robinson’s influence, support and encouragement of Eichner. They also illustrate Eichner’s contributions to the 1973 manuscript. Under the inspiration of Robinson, Eichner’s article developed from a theoretical model of price formation in oligopoly into the embryo of a broader microeconomic theory. This theory could serve as the basis for macroeconomics from a Cambridge (UK) perspective. This change explains the self-conscious character of the manuscript submitted to the Economic Journal. Section 3, “Behind the Scenes: Adrian Wood’s Role in Publication,” is based on correspondence between Eichner and Adrian Wood between 1972 and 1973, and between Adrian Wood and David Champernowne and Brian Reddaway, the editor-in-chief and associate editor, respectively, of the Economic Journal. Wood completed his dissertation entitled “The Distribution of Income in the United Kingdom 1870–1965: A Study in the Application of Post-Keynesian Theory” as part of his Junior Research Fellowship at King’s College, Cambridge, in November 1968. Shortly afterwards he began his doctoral studies. While completing his doctoral thesis, Wood met Eichner during his visit to Cambridge in May 1972. Over the next two years, their conversations centered mainly on Eichner’s original manuscript, which later became “Megacorp and Oligopoly” (Eichner, 1976). The possibility of its publication was under consideration by Cambridge College Press. They also discussed Eichner’s article on the relationship between price formation in oligopolies and inflation, which Eichner now intended to publish in England. Section 5, 'Reactions and Debates',” looks at the reactions and debates surrounding Eichner’s work in 1973. Finally, Section 6, 'The Emergence of a Movement: The Impact on Early Post-Keynesianism in the United States,” presents reflections that link the debate to the militant identity that early post-Keynesianism took on in America. By and large, the study provides conclusive evidence that the review and subsequent rejection of Eichner’s manuscript by American journals such as the AEA and QJE led Eichner to realize that there might be an institutional boycott of ideas similar to his in the United States. This situation prompted him to reach out to British colleagues, which marked the beginning of his collaboration with Joan Robinson. As is well known, both played a crucial role in the formation of a dissident Keynesian community in the United States and the subsequent establishment of post-Keynesian economics in America (LEE, 2000a and 2000b). In this context, the debate marked the emergence of a realization of the need for a paradigmatic reform of economic science and the adoption of a stance that ‘challenges the mainstream on its own terms’. Finally, the study shows that Eichner's initial skepticism about the role of discussions of macrodynamics was eventually dispelled by Robinson, who convinced him of their importance and realism, which explains the central importance he attaches to this topic in his later works. DELORME JR, Charles D.; RUBIN, Paul H. A Theory of the Determination of the Mark-up under Oligopoly: A Comment. The Economic Journal, v. 85, n. 337, p. 148-149, 1975. EICHNER, Alfred S. A theory of the determination of the mark-up under oligopoly. The Economic Journal, v. 83, n. 332, p. 1184-1200, 1973. EICHNER, Alfred S. Determination of the Mark-up under Oligopoly: A Reply. The Economic Journal, v. 84, n. 336, p. 974-980, 1974. HALL, Robert L.; HITCH, Charles J. Price theory and business behaviour. 1939. HAZLEDINE, Tim. Determination of the Mark-up under Oligopoly: A Comment. The Economic Journal, v. 84, n. 336, p. 967-970, 1974. LEE, Frederic S. Alfred S. Eichner, Joan Robinson and the founding of post Keynesian economics. In: Twentieth-Century Economics. Emerald Group Publishing Limited, 2000a. p. 9-40. LEE, Frederic S. The organizational history of Post Keynesian economics in America, 1971-1995. Journal of Post Keynesian Economics, v. 23, n. 1, p. 141-162, 2000b. ROBINSON, Romney. Determination of the Mark-up under Oligopoly: A Comment. The Economic Journal, v. 84, n. 336, p. 971-974, 1974.

Título do Evento: XVII Encontro da Associação Keynesiana Brasileira
Cidade do Evento: Maceió
Título dos Anais do Evento: Anais do XVII Encontro da Associação Keynesiana Brasileira
Nome da Editora: Even3
Meio de Divulgação: Meio Digital

Como citar

SPOSITO, Theodoro Cesar de Oliveira. ALFRED EICHNER, JOAN ROBINSON, ADRIAN WOOD AND THE REVIVAL OF HALL AND HITCH'S LEGACY: A HISTORY OF EICHNER'S “COST-PLUS” ALTERNATIVE TO THE CHAMBERLINE-ROBINSON PRICING MODEL.. In: Anais do XVII Encontro da Associação Keynesiana Brasileira. Anais...Maceió(AL) FEAC-UFAL, 2024. Disponível em: https//www.even3.com.br/anais/akb2024/894340-ALFRED-EICHNER-JOAN-ROBINSON-ADRIAN-WOOD-AND-THE-REVIVAL-OF-HALL-AND-HITCHS-LEGACY--A-HISTORY-OF-EICHNERS-CO. Acesso em: 11/09/2025