In this decade JJ's academic output reached a peak, and much of it was concerned with his work on Berkeley, whose economic writings JJ increasingly regarded as seminal, a precursor of most if not all modern economic thinking. Most of this work was published in the TCD publication Hermathena. This somewhat restricted its international accessibility. He did however circulate reprints of Hermathena papers (of which small stocks remained among his possessions), and he began to publish in the mainstream economic publications in Britain, especially the Economic Journal, then edited by J M Keynes.

Hermathena publications

I don't seem to have this; it is not among JJ's papers. It is however accessible on the record, but not germane to JJ's mainstream thinking. I suspect it was his swan-song as a classicist, or perhaps a nod in the direction of the requirement to generate academic research output in his original field, his real attention being directed towards the work which later led to his 'Nemesis of Economic Nationalism'.

An International Managed Currency in the Fifth Century; XLVII p132, 1932.

This deals with Croesus and refers to the 5th century BC. It is a highly technical analysis of the use of currencies in trading in the eastern Mediterranean, between Greeks, Persians and Phoenicians. It is appropriate to give a key quotation:

"The monetary significance of this change is considerable. It means that the electrum coins of Cyzicus (and probable Lampsacus too) after the first period were relegated to the position of a token currency, kept at par with a mono metallic silver standard currency by artificial regulation in essentially the same way as 20 shillings are kept at parity with a £, although the silver content of 20 shillings is worth very much less..."

He must have sent a copy to Keynes, because there is a letter from him to JJ dated 11 April 1933:

"I am very sorry that I shall miss you on my forthcoming visit to Dublin, particularly as you have been lately been dealing with much the same subject.

I was much interested in your article on questions of ancient currency, a subject in which I have dabbled myself more or less seriously from time to time. I have the impression that the bi-metallic system of the Persian Empire worked efficiently for a long period of years, without either metal driving the other out of circulation, in spite of moderate disparities from the Persian ratio on the adjoining Greek territories, and have often pondered how this could have been achieved. I suspect that the Temple hoards operated to preserve the official ratio, much as a Central Bank with very large reserves might do today. We know what enormous figures the Temple hoards had reached by the time of Alexander, and if the Temples always rigorously observed the official ratio, this might well have produced the necessary stabilising effect.

Yours very truly J M Keynes"

(There is a review by JJ of two books relating to 17th-18th century economics: Irish Life in the 17th Century by E McLysaght (Longmans, London 1938) and The Economic History of Cork City by W O'Sullivan (Longmans, 1937). In this review JJ identifies tentatively the 1701 deflation as being the key factor underlying the poverty of the early 18th century, and relates it to a similar episode under Elisabeth I. I conjecture that this review was the trigger for his subsequent 1939 Hermathena paper.)

Irish Currency in the Eighteenth Century; LII p3, 1938.

This paper appears subsequently as Chapter VI of his 1970 'Querist in Historical Perspective', with some revisions. It is a highly technical paper, in which he adduces arguments made by George O'Brien subsequently, and by Thomas Prior and Dean Swift during the century, as well as those of Berkeley. There are echoes in the argument of the earlier experience of Solon and Croesus.

Commercial Restriction and Monetary Deflation in 18th Century Ireland; LIII p79, 1939.

This paper appears subsequently as Chapter IV of his 'Querist'. According to JJ '..Berkeley was profoundly right in thinking that Ireland was to a much greater extent the victim of merchantilist monetary thought (or prejudice) at home than of merchantilist commercial policy abroad..' The solution to the problem was '..well within the power of the Irish Government, in spite of the limitations of its constitutional authority..'. JJ accesses the TCD estate records and analyses the values of the leases, in the context of the disastrous currency change of 1701, which he identifies as being much more significant that the woollen restrictions.

Berkeley and the Abortive Bank Project of 1720-21; LIV p110, 1939.

Banking in the early 18th century was private and prone to failure, yet banknotes of all sorts circulated, and in fact constituted a currency, even though the credit on which they were based was often flimsy. "Whether current banknotes may not be deemed money? And whether they are not actually the greater part of the money of this kingdom?" (Berkeley's Querist). I quote JJ: "...one would have thought that the proposal to establish a solid and substantial corporate bank, which appeared in 1720, would have received a warm welcome... (there was) a petition from the Earl of Abercorn...to raise a fund of £500,000....The King approved...".

There was however considerable hostility aroused, from Swift and others; JJ analyses this, and identifies as one factor the perception among the colonial elite that "...the Papists cannot purchase lands and are at a loss how to lay out their money. They will buy Bank stock and get control of the Bank to the weakening of the Protestant interest..". JJ's hero Berkeley alas at this time is away on his travels, and so is unable to intervene in the dispute. JJ argues that Berkeley would have held out, in accordance with his writings, that the bank should have been nationally owned rather than privately.

A Synopsis of Berkeley's Monetary Philosophy; LV p73, 1940.

This appears as Chapter VII of JJ's 1970 'Querist' edition commentaries. He makes a case for the inseparability of Berkeley's social and monetary philosophies: '..whether money be not only so far useful, as it stirreth up industry, enabling men mutually to participate in the fruits of each other's labour?..'.

'For, in its essence, money is only a means of conveying and recording power to command the industry of others, and others will not give their services in exchange for it unless they have confidence that they in turn can get what they want in exchange for money'. This far JJ; he then quotes Berkeley: "Whether all circulation be not be not like a circulation of credit, whatever medium (metal or paper) is employed, and whether gold be any more than credit for so much power?".

JJ stresses the identity of money and credit as seen by Berkeley, and relates this to his promotion of the need for a national publicly-owned banking system. Private ownership of the banking system, as is has evolved, regards the distinction between money and credit as being of great importance. For a modern financier, a debt is liquidated when money is repaid. For Berkeley, monetary obligations are only liquidated when transformed into solid goods and services. The latter is JJ's position.

JJ concludes by remarking that '... the idealist philosopher who disbelieved in the independent reality of matter was before all else a realist in his economic thinking.'

The foregoing, to my mind, puts the economic thinking of both JJ and Berkeley firmly on what in modern terms has come to be known as the 'political left'.

Locke, Berkeley and Hume as Monetary Theorists; LVI p77, 1940.

I feel I should give two quotations from this, which appears as Chapter VIII of his 1970 'Querist' commentaries:

"Berkeley must have read Locke's monetary pamphlets, and Hume may be supposed to have read the Querist. Hume's ideas were absorbed by his bosom friend Adam Smith, and passed by this channel into the main British stream of accepted monetary doctrine. And yet, as we shall see, essential elements in Berkeley's monetary philosophy failed to penetrate the mind of Hume, and accepted monetary doctrine has been impoverished as a consequence. The theory of money that appears in Adam Smith's 'Wealth of Nations' stands decidedly apart from his main line of reasoning."

After some five pages or so of close argument JJ concludes: "...Thus Hume deliberately opposes not only the main theme of Berkeley's book (national banking), but what the event has proved to be the inevitable and necessary form of commercial and monetary development - the growth of paper credit...".

Nemesis of Economic Nationalism

Other Academic Papers

In this paper he focuses on the disequilibrium between agriculture and industry, and on the various types of friction in the pipeline between the producer and consumer of agricultural goods. As an example he considered how '...the butcher, the baker, the grocer and the milkman (were) left unpaid because the next instalment was due on the wireless set..'. Price movement is the means of overcoming the various disequilibria, and in the pre-war world all prices were reasonably elastic. 'In the post-war world we meet a whole host of new price rigidities, for example the price of labour in sheltered industries, and the price of goods monopolistically produced...'.

Governments had tended to react to international trade disequelibria by imposing tariffs, rather than allowing supply to react to demand via the price mechanism. There was no longer a world price for wheat, due to European protectionism against cheaply-produced US wheat, the result being that there was a factor of 4 in the price of wheat (for example) between France and Argentina. The drop in demand for producers goods was much greater, due to the high incidence of monopoly pricing. This deters new investment, and is the main obstacle to recovery.

On the whole JJ used this Bankers platform as a means of launching his classic Free Trade onslaught on economic nationalism, later to be developed in his 1934 'Nemesis' book.

Later in 1968 he resurrected the reprint of this paper, and circulated it as an argument against EEC protectionism on a regional scale, as part of his critique of the 'rich mens club' of 'fortress Europe', of which Ireland was being railroaded into applying for membership.

Solon's Reform of Weights and Measures; Journal of Hellenic Studies, Vol LIV, p180, 1934.

This paper exudes classical erudition; quotations are given untranslated in the original Greek, making it difficult for a non-classicist to follow the argument, but the essence would seem to be that Solon, when introducing economic reforms largely in favour of the common people, devalued the currency, and to make it look better, also reduced the values of the weights and measures by a corresponding amount, introducing some stresses and strains into inter-city trade, but preserving the local relationships between nominal prices and nominal quantities.

The Economic Journal, edited by JM Keynes and EAG Robinson, in its September 1934 issue (Vol XLIV no 175 p453) carried a paper by JJ on 'The Purchasing Power of Irish Free State Farmers in 1933'. This was a quantification of the catastrophic collapse of agricultural purchasing power consequent on the 'economic war' arising from de Valera's policy on the land annuities. The drop from £42.4M to 23.7M between 1930 and 1933 is analysed by product. There are some ironical asides, like a reference to the fact that encouraging farmers to grow import-substituting tobacco, in accordance with the self-sufficiency policy, cost the exchequer £300,000 in lost duty on imports, excise on home produce being preferential. Farmers gained £187,500. JJ ordered reprints (a small stock remains), with a view to using a paper in a prestigious journal abroad as a means of supporting his arguments at home.

Agriculture and the Sickness of the Free Economy; Studies, XXIV no 94, p295, June 1935.

I count this among the academic stream, given that the Jesuit quarterly Studies is refereed and has a scholarly reputation. It is however polemic, and really belongs in the outreach category treated in the Barrington and Statistical and Social Inquiry Society streams. He got reprints for distribution.

The de Valera 'self-sufficiency' policy was it its height, and agricultural exports were crippled by the 'economic war'. Drawing on sources as diverse as the Roman Empire, the USSR, the USA, Adam Smith, the Physiocrats and the Merchantilists, JJ diagnoses the sickness of the economy in terms of the inadequacy of agricultural incomes, and homes in on the need for enhanced agricultural productivity via 'large mixed farms where machinery is used'.

The experience of the Roman Empire and the USSR is identified as '..systematic exploitation of masses of agricultural producers in the interests of an urban bourgeoisie and proletariat, and later of a bureaucratic imperialism...producing an economic situation in which the peasants no longer found it worth while to produce on any serious scale for exchange..'.

The Anglo-Irish Economic Conflict; Nineteenth Century and After, DCCVIII, February 1936.

I have not managed yet to track down this (perhaps quarterly) periodical, which was published by Constable, and would appear to have had a long run. I suspect it was a sort of 'think tank' or theoretical journal of the Liberal Party. The paper by JJ which is to hand is a reprint, and from internal evidence it was a public lecture read on an occasion, perhaps at his Alma Mater in Lincoln College Oxford, but this is a guess.

JJ used the occasion, whatever it was, to give an English audience an overview of the current Irish political environment. He led in with a reference to his 1920s Barrington Lecture experience, during which '...in the first year or two (he) had to compete with the rival entertainments provided by bank robbers and civil warriors..'. He was '..vaguely conscious that the academic outlook was somehow divorced from the point of view of the man who was in daily contact with economic realities..'. He had '..sat on more than one Government Commission, and had numerous opportunities of hearing practical men give their views, and yet we seemed to speak a different language..'.

He recounted how in 1928 he had taken up residence in the country, and had begun to keep a few cows and hens as a hobby, '...seeking to acquire the art of expressing elementary economic truths in language which our agricultural population can understand and appreciate..'. (This suggests that his attempts in the 20s to being Enlightenment Liberal political economy to the Irish rural masses had been in vain, and he had learned a lesson from the experience.)

After 1932 he found himself '..diametrically opposed to the policies which are now the official policies of our Government..'. He was however '..glad to be able to state that (he had) enjoyed complete freedom of speech in both town and country; on two occasions Ministers (had) occupied the same platform...argued their view in opposition...thus helping....in giving wider publicity to the policies (he) recommended....De Valera and his colleagues have always been most friendly...'.

Arguments about 'breaking up the ranches' were supported by the production per acre being greater on small farms. Production per farm worker on large farms well managed however was much greater (he references his recent Statistical Society paper to this effect, expanding on it somewhat, to the effect that three farmers were present who between them farmed 700 acres and employed 50 workers.). Larger total production must be taken up by exports, given that agricultural production already is twice domestic consumption. The current British tariff and quota system generated by the 'economic war' was bankrupting the productive large farmers.

In 1933 he had set himself the problem of how to 'win' the economic war, and to keep the land annuity payments in fact as well as in form (they had de facto been paid via the export bounty process). In his 'Nemesis of Economic Nationalism' he had advocated the use of our substantial realisable foreign assets for an investment programme, employing '...our dislocated workers in tidying up our national household without any danger to currency stability..'. Imports, as a 'war' measure, could be from non-British sources, thus perhaps depressing the foreign exchange value of sterling.

The loss in capital value of Irish agricultural assets JJ estimates ad £100M, and this was simply destruction, not just robbery, as it had been in the time of the landlords who confiscated tenants' improvements.

Unfortunately there is no clear message regarding what he wanted his audience, presumably of English Liberal intellectuals, to do next. This is perhaps a basic weakness in JJ's critical position. The natural target for his arguments at this time was the political labour movement, but he was some way from identifying this.

The Place of Wheat in Irish Agriculture: this paper exists in typescript form among JJ's papers, with the note 'written in 1937' appended to the title. He seems to have attempted to get it published at the height of the 'economic war' but was unable to do so. Some of the elements in it, particularly the economics of stall-feeding, relate to the following Economic Journal paper; it seems he put it aside and reworked it as an 'export publication'. He subsequently came across it and contemplated using it in the context of his Berkeley project, as it has deep roots in the economic history of the 18th century. This I think is when he prepared the typescript. In the end for the Berkeley project he confined himself to published material. Because of the importance of the Fianna Fail wheat policy in the 30s this unpublished work deserves reproduction in full.

He used the material in his Seanad speeches subsequently, when he needed to develop a critical approach to current wheat policies. In the paper he had also developed the argument that the wheat policies of the 1780s and 90s, which were currently viewed as supportive of the de Valera 'self-sufficiency' policy, were in fact long-term disastrous, and contributed to laying the basis for the Famine.

Price Ratios in Recent Irish Agricultural Experience; Economic Journal (ed Keynes & Robinson) December 1937; Vol XLVII no 188 p680.

In this paper JJ develops a classical Adam Smith argument from the Wealth of Nations, regarding the need for a certain ratio between the price of cattle and corn to exist, if continuous improvement of arable and pastoral land is to take place. It take 7 pounds of cereal under stall-feeding conditions to produce 1 pound of beef. The price of oats relative to cattle between 1891 and 1929 was stable, even during the war. Then came 1933 and the economic war. There was a huge jump in the ratio, to the extent that it would require 3.3 pence worth of oats to produce 2 pence worth of beef. The cattle population therefore dropped in 1936 to below the 1881 level. He produces a similar argument for poultry and pigs. He concludes that nothing can take the place of cattle as the central product of Irish agriculture, and cereal production can only thrive if cattle are profitable enough to require stall-feeding.

The Monetary Theories of Berkeley; Economic History (a supplement to the Economic Journal, edited by JM Keynes and EAG Robinson), February 1938.

In this JJ identified in Berkeley forerunners of ideas expressed in Keynes General Theory: "Berkeley anticipated Mr Keynes' view...that an increase in the quantity of money, if used for productive purposes, would increase the volume of employment."

He goes on to relate some of Berkeley's queries to "...the most important of all the important facts formulated in Mr Keynes' General Theory is that capital is brought into existence not by the propensity to save, but in response to the demand from actual and potential consumption...".

He concludes: "..in his emphasis on the importance of consumption as a factor in the production of wealth, in his realisation of the vital part played by the quantity of money in the promotion of commerce and enterprise, Berkeley must be regarded as a precursor of Keynes. In his analysis of the nature of money itself, and of the function of gold in relation to it, Berkeley showed a complete emancipation from the merchantilist opinions of his time, and he takes high rank as one of the most modern and 'advanced' of monetary thinkers."

In pre-publication correspondence with Keynes JJ received the following letter dated April 5 1937:

"I much prefer the new version of your comments on Berkeley. But your note is now open to a new objection:- by relating it more closely to my views, you are in danger of bringing it within the objection that I am now having to attend to, that far too many articles sent to the Journal are on this and on analogous topics.

I have, however, in the enclosed suggested some small modifications which would do something to meet this. If you could accept these and are ready to let me publish it in Economic History, where there is much less pressure on my space, I should be glad to accept it.

I read Berkeley's Querist a few years ago, but I admit that his theories were not vividly in my mind when I was writing my General Theory.

Yours very truly, J M Keynes."

This issue of Economic History contains also a paper by J M Keynes on Adam Smith as Student and Professor, giving interesting biographical insights, like falling into a tan-pit while demonstrating division of labour.

An Outlook on Irish Agriculture; Studies XXVIII no 111, September 1939.

This continues the arguments of the 1935 paper, in the light of subsequent experience. Aggregate money income in agriculture declined from £52M in 1929 to £29M in 1933 and by 1938 had increased again only to £38M. The increase in industrial production under protection had increased the wealth of the towns but had increased the prices of industrial goods bought by declining agricultural incomes. A section of the paper is headed "Fallacy of 'Increasing Home Market' by mere Distribution of a Declining Population". The policy of division of large farms is again looked at critically, in the light of the potential for increased productivity, per man and per acre, presented by mechanisation in a well-managed large-scale mixed farming environment consisting of specialising large and small farms. Again, he got reprints for distribution.

Irish Agriculture, Then and Now; Manchester School of Economic and Social Studies; October 1940.

This paper reviews critically the 'economic war' period and analyses the relationships between cattle, pigs, poultry, milk, grass and cereals. JJ introduces it with an outline of his experience of farming and market gardening between 1928 and 1934, when he '..abandoned the unequal struggle and devoted his spare time to poltico-economic agitation..' becoming a Senator in 1938 and then '..graduating back again into agriculture with the ownership of a 25 acre grass farm some 30 miles from Dublin..'.

It constitutes a useful review of academic and practical insights into the main inputs and outputs of Irish agriculture during the 1930s, summarising much of his work during this period. It is perhaps worth scanning in for reproduction in full, as an example of JJ's style in this context.

Some navigational notes:

Copyright Dr Roy Johnston 1999