Empirical and Ideological Elements in the Decline of Ricardian Economics

Abstract

Historians of economic thought have debated the relative import ance of theoretical advances, changes in the economy, ideological factors, and confrontations of theory with evidence in explaining the rise and decline of eco nomic paradigms. In the case of the decline of Ricardian economics in England in the 1830s, the debate has focused on the alleged empirical irrelevance (because of technical improvements) of Ricardo's theory of diminishing returns in agri culture versus the disturbing ideological implications of Ricardo's labor theory of value. for the dominant class. This paper reviews this debate and attempts to assess the significance of the empirical relevance of Ricardo's rent theory by com paring contemporary reports with new estimates of trends in the share of agricul tural output that went to rent. The findings suggest that Ricardo's predictions of an increasing rent share operated in England until well into the 1830s, indicating that contemporary charges of empirical irrelevance did not rest on a strong foundation and that ideological factors may have motivated some of the early at tacks on Richardian rent theory. By the 1830s the insurgency of subordinate classes had replaced the power of the landowners as the main challenge to the bourgeoisie. The paper concludes by examining how these changed class relations and the associated changed conditions of capital accumulation might have moti vated revision of the Ricardian doctrine.