There’s been a recent fuss in various media arising from a tweet from economist Ben Golub regarding astonishment that economists haven’t “worked through” Smith and Marx. English professor Alex Moskowitz chimed in with a claim that economics can’t be a real discipline because economists don’t know the history of their own discipline.
This claim is oversold as regards Smith. Every econ student gets the pin factory example of scale economies and the standard quote about the butcher, the baker and the Invisible Hand. And any moderately sophisticated economist knows that the Theory of Moral Sentiments refutes the vulgar self-interest theory of the kind of people who wear Adam Smith ties. There’s lots more interesting stuff on labour saving innovation, risk attitudes and other topics which still gets quoted.
As for Smith’s writing in support of free trade, it isn’t read much but not because economists now teach fancy mathematical models. Ricardo superseded him, not long afterwards, with comparative advantage, and his example of Portugal, England, cloth and wine is still a standard illustration.
Then there is some stuff that is just plain wrong, like the distinction between productive and unproductive labour. 19th century economists from Smith to Marx wasted a lot of time on this, but there’s no point in rereading it, except for the kind of history of economic thought rather brutally described as “the wrong ideas of dead men(sic)”.
So, it’s true that hardly anyone, except historians of thought, “works through” The Wealth of Nations, let alone Smith’s entire body of work. Like readers in many genres, economists reading Smith skip straight to the good bits.
Unlike with Smith, not many economists read Marx, or at least Capital, any more, because not many economists do Marxist/Marxian economics any more. Marx wrote lots that is still relevant, most obviously the Communist Manifesto, with which any educated person, and certainly any economist, should be familiar. The account of the rise of capitalism, the class struggle and the potential for crisis in capitalism was unequalled when it was written and still commands our attention. But it isn’t something that needs to be “worked through” to do economics.
The economic analysis in Capital is not part of the intellectual history of mainstream (neoclassical/Keynesian) economics. The micro-economic approach that stems from the marginalist revolution of the 1870s owes nothing to Marx, and was developed by economists who had probably never read him (the first published critique from a marginalist viewpoint was by Wicksteed in the 1880s). Keynesian macroeconomics shares with Marx the recognition that capitalism is inherently prone to crisis, but doesn’t draw on his theoretical framework much. Henry George, also little read today, is probably more relevant. His ideas on taxing appreciating land rents have been misappropriated by single-taxers but they remain valid and policy-relevant.
For a long time, Marxist economics was relevant as a rival to the dominant neoclassical/Keynesian program, but that is no longer true. There was still a moderately active literature on the “transformation problem” 50 years ago, but it seems to have died, or (according to Andrew Kliman) been resolved. Most leftwing critiques of the mainstream now draw more on Keynes and Minsky than on Capital.
Given that Marxist thought is still influential in lots of spheres, the decline of Marxist economics might well be a problem. But, if so, the answer is for Marxists to do more and better economics
Coming back to mainstream economics, the lack of historical awareness is a real problem. But the problem isn’t a lack of appreciation of the classics of the long 19th century. It’s that the economics profession pays far too little attention to its relatively recent history, from the 1930s to the present.
Most glaringly, as Paul Krugman points out fairly regularly, there have been only the most cursory attempts to explain the success of Keynesian macroeconomic policies in the decades after 1945. The NAIRU model for short-term macro policy, followed by all central banks, rests almost entirely on the experience of stagflation in the late 1960s and early 1970s. And the theoretical twists and turns that produced the currently dominant Dynamic Stochastic General Equilibrium model (the Lucas critique, new classical macro, various versions of “New Keynesianism”) have largely been forgotten. The result is that a theoretical-policy framework, centred on inflation targeting is presented as an eternal truth, when it is only about 30 years old and has had very limited success either as an explanatory/predictive theory or as a guide to policy.
The situation is not quite as bad outside macro. But, to the extent that macro theories are wrong, the results of most micro analysis can only be regarded as partial and provisional. And an awareness of intellectual history would lead to a much more cautious view of our current theories and tools, notably with respect to game theory.
John Quiggin 
Clearly you are someone who “read Smith skip straight to the good bits.” or what he things they are, as your comments about the TMS and Smith’s other work suggest. But you are in good company. Schumpeter also read only “the good bits” and only the good bits in the WN for that matter, being ignorant of the TMS.
https://www.cambridge.org/core/journals/journal-of-the-history-of-economic-thought/article/abs/schumpeters-assessment-of-adam-smith-and-the-wealth-of-nations-why-he-got-it-wrong/34DA92C20EA20266D0198FF4BE4F235F
I recommend, with due modesty, you try this:
Adam Smith’s System: A Re-Interpretation Inspired by Smith’s Lectures on Rhetoric, Game Theory, and Conjectural History | SpringerLink
(Happy to send you the pdf.)
I agree that too few economists read Marx (and Schumpeter) although I submit that reading Kapital v 1 is mostly a waste. There is better stuff to read such Marx’s Theories on Surplus Value (Kapital v 4).
Here is a quick primer on both:
https://a-ortmann.medium.com/kalle-and-me-schumpeter-too-9c5ffcbb6b37
Not only should economists know their own history, they should know enough of heterodox economic history (and vice versa if they are heterodox) and of general history as well. Of course, there are limits. Nobody can major in everything.
If there is a reading blind spot among standard orthodox and standard heterodox (usually Marxist) economists it is probably the “Capital as Power” thesis of Shimshon Bichler and Jonathan Nitzan. Bichler and Nitzan seem, on my admittedly limited purview, to be unjustly ignored by most economists. B&N have something genuinely new to say and have approached economics in a scientifically supportable manner, in terms of fundamental empirical ontology.
This has nothing to do with metaphysical ontology, so please no jokes about Anselm of Canterbury. In science, studies of real systems depend on the development of dependable ontologies of fundamental objects from empirical investigation: fundamental to the discipline in question and with theoretical, analytical and explanatory applications. With respect to formal systems, an ontology of fundamental objects is defined: with rigor for say mathematics and via custom and use for languages. In the materialist or physicalist purview, formal systems are subsets of real systems and they are linked via operations of matter, energy and information. Enough on that, except to say that in my view if economists ignore such scientific developments they will be left behind. Also, so far as I know, this has little to do with Tony Lawson’s theories on economic ontology: which seem to be more located in social science not in hard science.
Here is useful review though I don’t think I agree with everything in it. It is better to go to the main texts of Bichler and Nitzan via their Capital as Power website.
Phttps://www.econstor.eu/bitstream/10419/191801/1/20110000_lasonc_review_of_casp.pdf
People really need to try to challenge their entrenched paradigms from time to time, I think.
John
I am pretty sure that Gossen the German economist who was the first to develop a theory of marginal utility in his book *Development of the Laws of Human Intercourse and the Consequent Rules of Human Action published in * 1854 (and cited by Jevons in 1862) was also the first to publish a critique of Marx based on marginal utility.
Cheers David
JQ includes:
Nate Hagens interviewed economist Steve Keen on 14 Dec 2023 that can be seen/heard in the YouTube video titled Steve Keen: “On the Origins of Energy Blindness” | The Great Simplification #108, duration 1:32:26. It included (per the Transcript):
And in conclusion:
Retired Professor Eliot Jacobson posted at his Climate Casino blog on 5 Jan 2025 an analysis headlined Betting on the End of the World: 2025 Edition. His piece included his Over/Under numbers for the global 2-metre surface temperature anomaly for 2025 through to 2050. He’s suggesting that the +1.5 °C GMST anomaly (10 years actual data + 10 years projected) could be breached as early as 2027, and the outlook for the +2.0 °C GMST anomaly is perhaps around 2040 (relative to the 1850-1900 baseline, using Copernicus ERA5 dataset).
Human Climate Niches are shown in the animated map here in green 🟩 and regions of Mean Annual Temperature >29 °C (MAT >29 °C) in purple 🟪. The MAT >29°C is an important threshold as beyond this point, humans are exposed to historically unprecedented levels of heat, with an increased frequency of potentially lethal maximum temperatures over 40°C and physiologically challenging wet bulb temperatures (WBT) over 28°C, posing serious threats to health and survival.
At +2.7 °C GMST anomaly, one-third (22-39%) of the world’s population could be living outside the ‘human climate niche’. This means that billions of people could be living in areas that are too hot for humans to comfortably or safely live.
Meanwhile, The Guardian published on 16 Jan 2025 an article by Sandra Laville headlined Global economy could face 50% loss in GDP between 2070 and 2090 from climate shocks, say actuaries. It included (bold text my emphasis):
When is mainstream economics going to wake-up to the existential threats facing human civilisation?
“When is mainstream economics going to wake-up to the existential threats facing human civilisation?” – Geoff Miell.
Mainstream economists are not, in the main, unaware of climate change and its dangers though some (maybe many) have low-balled and discounted the dangers excessively. That judgement does not apply I think to our host.
However, as well as the excessive discounting, there has been an excessive faith by most people in markets, or else excessive hope in being able to get markets regulated properly. This has gone along with excessive techno-optimism and a lack of knowledge of the issues of Jevon’s “paradox”. Finally, there has been a deep lack of understanding among the public of the immutability and power of physical and biological laws and forces. They have lived in a protected bubble too long where economics appeared to have rolled back and repealed the laws of nature. It can do no such thing of course.
Along with that there has been almost no sign anywhere, except in the “Capital as (Social) Power” thesis, of the cutting-edge understanding that you cannot manage nature with markets: with aggregation of “values” in the numeraire and choices / decisions based on the same. It does not and cannot work because it is fundamentally flawed in terms of the “empirical ontology of real and formal systems”: a discipline I now define as (partly) a comparative investigation of all human attempts to manage real systems with formal systems. These attempts are most successful – for relatively simple physical systems – in the hard science disciplines. Such attempts are far less successful in the social science (soft science) disciplines and less successful again in broadly non-science fields like law, politics, ideology and theology, a system of systems where ever more complex systems of the physis and the nomos “collide”, interact and create “hybrid megasystem” for want of a better term.
To understand what I refer to above, at least in the first half of my last paragraph above, it is worth reading this short and very clear paper.
The Aggregation Problem : Implications for Ecological Economics – Blair Fix.
https://bnarchives.net/id/eprint/543/2/20180500_fix_the_aggregation_problem_wpcasp.pdf