William Kingston acknowledges the debt his work owes to great minds including Joseph Schumpeter, Christopher Dawson and Douglass North.

Those of us who write and publish are only too well aware of how much we owe to those from whose work we have quarried, even though we naturally hope to add something that is uniquely our own. In my case, the book How Capitalism Destroyed Itself is the outcome of a lifetime of study and publication across several different disciplines, and what follows is a reflection on three of the remarkable scholars from whom I learned much of it.

I have recorded in its preface how chance put me under the influence of Joseph Schumpeter, not only from his own writings, but also through membership of the Society which bears his name. In this, I met and learned from great scholars such as Hyman Minsky, who had been his student. Others, such as Richard Nelson, currently the President of this Society, have taken Schumpeter’s work onwards into the new discipline of evolutionary economics.

During his lifetime, Schumpeter’s reputation was overshadowed by that of Keynes. He was content to be an analyst, whereas Keynes, like Marx, not alone diagnosed problems but proposed solutions for them. He was Economic Advisor to the British delegation to the Versailles Peace Conference, and when he saw that this would not stand against Clemenceau’s determination to make Germany a waste land, he resigned, writing ‘I work for a Government I despise, in a cause I think criminal.’ He then wrote The Economic Consequences of the Peace, which forecast only too well the disasters that were to follow.

But what made Keynes so influential, to Schumpeter’s chagrin, was his 1936 General Theory of Employment, Interest and Money. If ever there was a case of ‘cometh the hour, cometh the book,’ this was it. With economic depression everywhere, not alone did Keynes legitimise public financing to compensate for private sector failure to invest, he also gave civil servants the excuse they needed to expand intervention in economies. We are all sensitive to ideas that are in our interest, and it is significant that although Keynes’ book was not officially published in French before the War, a mimeograph translation was circulating within the Ministère des Finances as early as 1937.

The huge book which was likely Schumpeter’s hope to achieve his avowed ambition to be ‘the greatest economist in the world’ was Business Cycles. It came out in 1939 and he himself described it as like ‘a house that is neither finished nor furnished,’ It could well be that he let it go to the public in this form because of the growing fame of Keynes’s book. So Keynes won in the short run, and yet with the longer term perspective we have now, Schumpeter’s view of the future looks to be the more plausible.

Great as my debt to Schumpeter is, it is even greater to Christopher Dawson, who was among the first to bring anthropology and sociology to the study of cultural history. His name will hardly be known to any economist, but after taking his degree in history in Oxford, he went to study under Gustav Cassels in Sweden, but found the subject too constricting. He had enough private means to escape the academic treadmill, and so could engage in his own highly original path of historical research and reflection. This meant that his first book, The Age of the Gods (1928) was the result of fourteen years of research. But it was his second, Progress and Religion (1929) that really  displayed fully the depth of his thought and the astonishing range of his learning.

I had become fascinated with his work as an undergraduate, and was then lucky enough to become his pupil just after he had completed his Gifford Lectures in Edinburgh, Religion and Culture (1948) and Religion and the Rise of Western Culture (1950). I still remember the surprise of my first prescribed readings: the book of Isaiah and Fustel de Coulange’s La Cité Antique ; until I grasped how these represented the two main streams that flowed together to make our Western world.

It would have been absurd to write about the decline of capitalism without some reference to where capitalism came from, and the chapter in which I attempt this reflects both Dawson’s teaching then and continual re-reading of his works since. He was the first to show conclusively that what were for so long called the ‘dark ages’ were in fact a highly creative period, as I hope my discussion of how some aspects of early medieval monasticism foreshadowed modern capitalism illustrates. Conversely, although it would need study of many more civilizations than our own and Rome’s to prove the point, it is at least a useful working hypothesis that the period of greatest economic activity comes late rather than early in every human culture.

It was from studying a particular aspect of contemporary economic activity that I incurred the third of my largest intellectual debts, to Douglass North. I had spent many years coming to grips with the field which is now known as intellectual property, and indeed it was this which first showed me how laws of property, which should serve the public good, can be captured by interests that benefit from them. The big breakthrough from intellectual property to property rights generally was due to North’s Culture and Change in Economic History.

In this and later books, North discusses the overarching importance of institutions, all the written and unwritten rules and usages which influence our ways of being and acting, the most economically important of which are clearly defined property rights. Emphasis on them defines what is known as the ‘new economic history,’ as a founder of which North won his Nobel prize. His conclusion that ‘strong moral and ethical codes of a society is the cement of social stability which makes an economic system viable’ allows his work to be directly intelligible within the broader cultural history of Dawson.

William Kingston is Professor at the School of Business, Trinity College, Dublin, Ireland.

His book How Capitalism Destroyed Itself: Technology Displaced by Financial Innovation is available now.