Liberal Aspects of Sidgwick’s
Economic Ideas
Daisuke Nakai
Abstract In the field of political economy, Sidgwick’s reputation is not so prominent, at least as compared with his stature in ethics. One reason is simply that he was not a pure or a formal type of economist whose academic interest had concentrated on carving out economic theory. However, a transformation has taken place in the concern and evaluation of Sidgwick and his work in recent years. First, we can dis-cern a growing condis-cern for his wide-ranging activities and interesting personality through his engagements with feminism, spiritualism, and intimate friendships. Secondly, the positive role that Sidgwick had in the history of economics has received greater attention. Based on these recent research efforts, we shall further clarify the nature and importance of Sidgwick’s economic ideas from their inherent linkage with his wide-ranging philosophical concerns. No one can deny that Sidgwick's obvious essence penetrating into his whole academic life was utilitarianism. Even so, why did he try to reshape orthodox political economy based on utilitarianism ? And what was his acute concern in political economy in the late nineteenth century ? On these points, liberal aspects we can trace throughout his political economy would appear to be the important clues.
Key words Henry Sidgwick, Liberalism, Utilitarianism JEL classification B３１
May 15, 2020 accepted
Address: Faculty of Economics, Kindai University, ３４１, Kowakae, Higashi-Osaka, ５７７８５０２, Japan. E-mail: [email protected]. This work was supported by JSPS,
１. Utilitarianism or Liberalism ?
The Methods of Ethics, published in １８７４ as Henry Sidgwick’s first book, has been
highly evaluated for its clear and systematic utilitarian discussion of moral and ethical problems. It is also interesting that among the most famous and ardent admirers was John Rawls, who was critical of utilitarian ideas.
In the field of political economy, Sidgwick’s reputation is not so prominent, at least as compared with his stature in ethics. One reason is simply that he was not a pure or a formal type of economist whose academic interest had concentrated on carving out economic theory; he made no direct contribution to its mathematical or theoretical development, in contrast to Alfred Marshall who had created a tide to be designated as the ‘new economics’ and who provided many indispensable tools for microeconomic analysis, although it does not necessarily mean that Marshall was a merely narrow kind of theoretician. It is also true that many scholars had often devoted their attention to Sidgwick’s economic thought, especially to its im-portance in the formation of the idea of market failure. Taking, for example, as Paul Samuelson stated, “［what］Pigou and Sidgwick so long ago warned us is true of all external economies and diseconomies”（ Samuelson １９５８）. Nonetheless, The
Principles of Political Economy, his second book published in １８８３, has often been regarded
as a negative work, and “many historians of thought regard Sidgwick as merely an expositor of Mill”（O’Donnell １９７９）.
However, a transformation has taken place in the concern and evaluation of Sidgwick and his work in recent years. First, we can discern growing concern for his wide-ranging activities and interesting personality through his engagements with feminism, spiritualism and intimate friendships. Especially important
“Sidgwick’s book. . . is the most philosophically profound of the strictly classical works” （ Rawls ２００７, p. ３７８）. See also the foreword to the reprinted edition of Sidgwick’s The
Methods of Ethics in １９８１ by Rawls. See Caine １９９４ and Schultz ２０００. See Oppenheim １９８８ and Wadge ２０００. See Booth ２００２.
is Bart Schultz’s definitive work published in ２００４, which explores Sidgwick’s intellectual life based on a detailed examination of his vast academic writings and personal manuscripts. Throughout this comprehensive treatise, Schultz sheds new light not only on Sidgwick’s ethical thought but also on “his deeper concerns about poli-tics and civilization”（Schultz ２００４, p. ５１２）. Schultz sums up the remarkable character as follows.
Sidgwick of course also wanted to free liberal studies from ‘the clergy and persons of a literary bias,’ and to advance a notion of culture that would incorporate a truer Platonic Revival, being bound up with modern languages and modern science.（Schultz ２００４, p. ７０６）
Secondly, the positive role Sidgwick had played in the history of economics has received greater attention. Roger Backhouse emphasizes Sidgwick as “the ori-gin of many of the ideas that drove the Cambridge school” through both economical and philosophical influences on Marshall, Pigou, and John Maynard Keynes（Backhouse ２００６）. Steven Medema underlines the fact that “Sidgwick ascribed an even greater set of failings to the system of natural liberty than did Mill”（ Medema ２００９, p. ５３）. Furthermore, Donald Winch states that “Sidgwick’s treatment of economic exceptions to laissez-faire was elaborately taxonomic, though―bearing in mind his claims for conceptual analysis―never merely taxonomic”（ Winch ２００９, p. ２２６）. Consequently, Sidgwick has been assigned a higher historical value than ever before.
Henry Sidgwick stands at the headwaters of the Cambridge welfare tradition. He built upon John Stuart Mill’s classical utilitarian framework while simul-taneously offering a different view of the role of the state in response to situations of market failure.（Backhouse and Medema ２０１２）
Schultz examines Sidgwick’s engagement in Society for Psychical Research, and per- sonal intercourse with intimate friends as such Balfour, Bryce, Dakyns, Myers, Noel, and Symonds. See also Schneewind １９７７.
Based on these recent research efforts, we shall further clarify the nature and importance of Sidgwick’s economic ideas from their inherent linkage with his wide-ranging philosophical concerns. No one can deny that Sidgwick’s obvious essence penetrating into his whole academic life was utilitarianism. Even so, why did he try to reshape orthodox political economy based on utilitarianism ? And what was his acute concern in political economy in the late nineteenth century ? On these points, liberal aspects we can trace throughout his political economy would appear to be the important clues. As examined in detail later, the reason why he took utilitarianism as the guide was to sweep out the confusing arguments of economic policy by its liberal and value-free thinking.
What is meant by ‘liberal’ or ‘liberalism’ is itself an intricate problem, partly because of diverging interpretations such as new/neo liberalism, economic/political liberalism, and libertarianism, of which the borders are unclear and about which claims often seem to be mutually conflicting. On the one hand, the history of economics ac-knowledges its strong bond with liberal ideas symbolized by its traditional advocation of laisser faire or economic liberalism against the extensive governmental interventions. On the other hand, the idea of laisser faire had often been criticized even by economists themselves, just as J. M. Keynes underlined “the inadequacy of the theoretical foundations of the laissez-faire doctrine”（ Keynes １９３６, p. ３３９）. In addition, regarding the fundamental significance of economic freedom or market competition, we can ascertain a diversity of views. From the eyes of so-called neo-liberalism such as F. A. Hayek or M. Friedman, economic freedom is not just the essential foundation for economic efficiency or economic growth, but rather “the prerequisite of any other freedom” including political and every individual freedom. Therefore the realization of economic freedom is “an indispensable condition of real liberty”（ Hayek １９４４［２００７］, p. １３２, １４７）. However, for Rawls or Amartya Sen, who distinguishes economic considerations from political liberties, it is important “The phrase laissez-faire is not to be found in the works of Adam Smith, of Ricardo, or of Malthus. . . As Sidgwick and Cliff Leslie have pointed out, Adam Smith’s advocacy of the ‘obvious and simple system of natural liberty’ is derived from his theistic and optimistic view of the order of the world as set forth in his Theory of Moral Sentiments, rather than any proposition of political economy proper”（Keynes １９２６）.
to define the necessities of both or rather the latter. Rawls says that “the equal political liberties cannot be denied to certain social groups on the grounds that their having these liberties may enable them to block policies needed for economic efficiency and growth”; and that “［t］he claims of the basic liberties cannot be overridden by such considerations”（Rawls １９９３［２００５］, p. ２９４）. Sen also emphasizes that “political liberty and civil freedoms are directly important on their own, and do not have to be justified indirectly in terms of their effects on the economy”（Sen １９９９, p.１６）.
Then was Sidgwick a utilitarian, or a liberal ? If he was the latter, what kind of liberal idea did he lay out ? While Sidgwick called himself an Academic Liberal, his ethical thought had often been criticized by new-liberals such as T. H. Green for its hedonistic and consequentialistic tendencies. Furthermore, his idea has also been ironically regarded as an elitist and conservative ‘government house utilitarianism’. At least if he were compared with John Stuart Mill, who was also a radical political activist, Sidgwick’s attitude might be judged as not so liberal. However as described above, Schultz discovered Sidgwick’s liberal academic character through detailed examinations. Furthermore, it is interesting that Hayek, a prominent and acute liberalist, highly evaluates Sidgwick as a great and forgotten nineteenth-century liberal:
Men like Lord Morley or Henry Sidgwick, Lord Acton or A. V. Dicey, who were then admired in the world at large as outstanding examples of the political wisdom of liberal England, are to the present generation largely obsolete Victorians. （Hayek １９４４［２００７］, p. １９４）
“［T］he results of the free play of the electoral process and of economic competition are acceptable only if the necessary conditions of background justice are fulfilled”（Rawls １９９３［２００５］, p. ３６２）
“［P］olitical freedom in the form of democratic arrangements helps to safeguard economic freedom and the freedom to survive”（Sen １９９９, p. ５２）.
Here Hayek mentions Sidgwick’s The Development of European Polity. However, as Schultz cites, for Hayek, Sidgwick’s The Elements of Politics was “in many respects an admirable work” but it scarcely “represents what must be regarded as the British liberal tradition and is already strongly tainted with that rationalist utilitarianism which led to socialism” （Hayek １９６０, p. ４１９; Schultz ２００４, p. ５７３）.
Yes, Sidgwick was a utilitarian based on hedonistic consequentialism because he was apparently convinced that empirical hedonism is the most objective and final criterion of value judgment. However, if we combine this philosophical recognition with his political economy, we will be able to ascertain Sidgwick’s liberal aspect more clearly, rejecting the confusion and dogmatic value judgment in economic ar-guments in the shadow of the late nineteenth century.
２. As an Academic Liberal
At this point it is probably useful to overview Sidgwick’s academic and political activities as an Academic Liberal. To explore their entire picture is beyond the scope of this paper, so we shall briefly examine Sidgwick’s liberal character based on his Memoir edited by his brother and widow in １９０６ and Schultz’s work above described here.
It is clear that, as many scholars have already described, The Apostles, to which Sidgwick was invited in １８５６ when he was an undergraduate student, provided a more decisive influence on his intellectual life than any other.
I can only describe it as the spirit of the pursuit of truth with absolute devotion and unreserve by a group of intimate friends, who were perfectly frank with each other, and indulged in any amount of humorous sarcasm and playful banter, and yet each respects the other, and when he discourses tries to learn from him and see what he sees.（Sidgwick １９０６, p. ３４）
The Apostles in Sidgwick’s generation had a strong liberal tendency under the influence of F. D. Maurice. The description given above has also been regarded as an im- portant clue to the mysterious Society, of which many eminent intellectuals such as G. E. Moore, B. Russell, and J. M. Keynes were members.
“［T］he liberal views of F. D. Maurice’s generation came to prevail at Cambridge and elsewhere within his lifetime and encouraged the growth of a new liberalism among the generation led by Henry Sidgwick”（Allen ２０１０, p. ２１７）.
In addition to this Apostle mind, another important aspect we can discern of him is his academic liberalism. Sidgwick recalls himself as an Academic Liberal:
I went up to Cambridge in October １８５５. . . I had no other ideal except to be a scholar as like him［Benson］as possible. Then, in my second year at Cambridge, I began to fall under different influences, which went on increasing till I was definitely enlisted as an ‘Academic Liberal.’（Sidgwick １９０６, p. １１）
E. W. Benson, Sidgwick’s cousin and future Archbishop of Canterbury, was to be called his “first mentor”（ Schultz ２００４, p. ３６）. However, as Sidgwick more came to act as an ardent Academic Liberal, the influence of Benson on him weakened. The decisive event establishing him as an eminent Academic Liberal was his resignation of fellowship in １８６９. He had strongly opposed the religious tests as dogmatic from the view of academic liberalism.
In an active mood of university reform at the time, Sidgwick’s academic character had been shaped under the strong influences of the Apostles and academic liberalism. Actually he was well known as an active reformer in Cambridge through his work at revision of university curriculum and the foundation of Newnham College. While we can discern the overlapping between the Apostles and Academic Liberals where Sidgwick was in the center places of both, it should not be passed over that academic liberals consisted of intellectuals of diverse types such as “Sidgwick’s utili- tarianism, Huxley’s Darwinism, T. H. Green’s idealism, and the Oxford Hellenism of Pater and the early Symonds”（Schultz ２００４, p. ４４）.
Schneewind １９７７, p. ２３; Moggridge １９９２, p. ５７; Lubenow １９９８, p. ３３; Dostaler ２００７, p. ２８; Allen ２０１０, p. ６.
“［T］he real leaders of academic liberalism at that time were a later set of Apostles, chief among them Henry Sidgwick, whose resignation of his fellowship in １８６９ was a key factor in bringing about the abolition of religious tests”（Allen ２０１０, p. １９）. “The academic liberals of these years, . . .certainly cherished ambitious hopes for the
revamping of all that was sectarian, and they expected to play a leading role in preparing the nation for greater democratization, better and broader education, increased profes-sionalization, and more progressive, less superstitious and dogmatic forms of worship and morality. The Apostles were of course much identified with this movement”（Schultz ２００４, p. ４４）.
Another definitive side of academic liberalism is, as indicated in its name, the connection with the Liberal Party. The two-party system had developed through the late nineteenth century under the two great statesmen: Disraeli and Gladstone. Sidgwick and other Academic Liberals were also supporters of the Liberal Party sympathizing with Gladstone, who was the leading figure in democratic reforms such as the Education Act in １８７０, the Trade Union Act in １８７１, and the Reform Act in １８８１.
Then was Sidgwick an adherent supporter of the Liberal Party, or an enthusiastic Gladstonian ? This problem is a bit complicated. Although we can find evidence throughout his activities and manuscripts that he sympathized with G. O. M. in many respects, Sidgwick was a member of the Liberal Unionists, opposed to Home Rule for Ireland, to which Gladstone was eager to devote his political life. Furthermore, on the one hand Sidgwick admitted the positive role of democratic principle; on the other hand, he repeatedly decried the danger of so-called ‘tyranny of the majority’ insisting that “the victims of democratic oppression will usually find resistance hopeless”（Sidgwick １８９１［１９０８］, p. ６４８）in his The Elements of Politics first published in １８９１, just like J. S. Mill emphasized it thirty years prior in Considerations on Repre-
sentative Government. Additionally, he had a strong intimate friendship with A. J.
Balfour, a pupil of Sidgwick, a brother in law, and the Tory’s leader and future Prime Minister. Thence we can also discern his aristocratic attitudes in his academic writings and personal correspondence.
To evaluate Sidgwick’s political stance or relationship with Liberals, an impressive episode is illustrative. When asked to be a Liberal candidate for Parliament in １８８５, he confessed the feeling with a very candid and mature tone in his diary as
follows.
I was tempted; but I communed with my political conscience and discovered that I could not come forward as a Liberal at this juncture without hypocrisy.
“［A］n insurrection against a government supported by an organised democratic majority is, on the whole, likely to be more disastrous in its effects than an insurrection against a tyrannical monarchy or oligarchy”（Sidgwick １８９１［１９０８］, p. ６４７）.
I am a Utilitarian, and would be a hypocrite if I were convinced that the country required this sacrifice; but I cannot rate my political value so high. In fact the temptation was really this: I want to write a great book on Politics during the next ten years, and am afraid it will be too academic if I do not somehow go into the actual struggle.（Sidgwick １９０６, p. ４０７）
The description above perfectly displays Sidgwick’s political stance. Certainly, we would be able to evaluate him as ‘a Utilitarian’ rather than ‘a Liberal’ from this. However, it also determinably reveals his careful attitude; in other words, Sidgwick was so cautious for every value judgment that he was even critical of his own val-ues and judgment. In spite of the active mode of political arguments in the late nineteenth when The Elements of Politics was written and published, he had seldom directly described the current topical issues in that voluminous book. That is true partly because he tried to seek the truth in the complicated problems with a purely academic and unbiased Apostolic mind, and so did not even care to become ambiguous or in-decisive in the end. Actually, while the democratic movement had gained ground, Sidgwick had repeatedly and consistently displayed a dualistic view between democ- racy and aristocracy, referring to the historical formulations of polities.
In this author’s view, this cautious attitude in value judgment, which can be traced in his entire academic works expanding from ethics to economics and politics, would be designated as liberal. The idea of ‘liberal’ or ‘liberalism’ was not placed as an important keyword in its direct usage in The Methods of Ethics and The Principles
of Political Economy; Sidgwick rather regarded it as one of the “particular virtues-‘just,’ ‘liberal,’ ‘brave,’ etc.” which value would be finally reduced into ‘Good’ or ‘happiness’（ Sidgwick １８７４［１９０７］, p. ２２２）. He sought a common measure that “I do not consider representative government―even when the suffrage is universal―
as merely a mode of organising democracy, but rather as a combination or fusion of de-mocracy and aristocracy”（Sidgwick １８９１［１９０８］, pp. ６１６６１７）.
“Common Sense may seem to regard Liberality, Frugality, Courage, Placability, as intrinsically desirable: but when we consider their relation respectively to Profusion, Mean- ness, Foolhardiness, Weakness, we find that Common Sense draws the line in each case not by immediate intuition, but by reference either to some definite maxim of duty, or to the general notion of ‘Good’ or Wellbeing”（Sidgwick １８７４［１９０７］, p. ３９２）.
can cover and judge the diverse elements.
［ I ］n saying that this must be the method of the Utilitarian moralist, I only mean that no other can normally be applied in reducing to a common measure the diverse elements of the problems with which he has to deal. Of course, in determining the nature and importance of each of these diverse considerations, the utilitarian art of morality will lay various sciences under contribution. Thus, for example, it will learn from Political Economy what effects a general censure of usurers, or the ordinary commendation of liberality in almsgiving, is likely to have on the wealth of the community. . . But how far the increase of wealth or of knowledge, or even the improvement of health, should under any circumstances be subordinated to other considerations, I know no scientific method of determining other than that of empirical Hedonism.（Sidgwick １８７４ ［１９０７］, pp. ４７９）
Sidgwick was irresolute to take one’s value or any specific virtue to measure another’s judgment because such a mode of estimation would lapse into dogmatic value judgment in his eyes. Although he could not reject ‘the dualism of practical reason’―the ultimate indissolubility between a benevolent disposition to the general happiness and egoistic disposition to one’s own happiness―for individuals in the end, the most reliable and practical guiding principle, he was convinced, was a comprehensive standard of utilitarianism based on empirical hedonism.
３. Political Economy and Laisser Faire
Then what was Sidgwick’s keen concern in political economy ? One can begin by overviewing his presidential address delivered to The Economic Science and Statis- tics Section of the British Association in １８８５ titled ‘The Scope and Method of Econo-
“［M］y treatise is not dogmatic: all the different methods developed in it are expounded and criticised from a neutral position, and as impartially as possible”（ Sidgwick １８７４ ［１９０７］, p. vi）.
mic Science,’ in which his interest was stated clearly.
He begins by telling the history of political economy and admiring Adam Smith as so careful for “the perpetual and complex opposition and conflict of economic interests involved in the unfettered efforts of individuals to get rich”（ Sidgwick １８８５［１９０４］, １７２）. However, the impressive feature in Wealth of Nations for most readers was the advocacy of the system of natural liberty. It had generated the optimistic view that “the social production of wealth will always be best promoted by leaving it altogether alone”, and the tendency rushing to “the sweeping generalisations” （Sidgwick １８８５［１９０４］, p. １７３）. Picking up the issue of distribution, he distinguishes
Adam Smith and orthodox political economy from these exceeding tendencies or laisser faire as follows:
［N］either Adam Smith nor the predecessors. . . had any design of maintaining that the distribution which they were endeavouring to analyse satisfied either the claims of ideal equity by giving each individual his desserts, or the claims of expediency by giving him what was most conducive to general happiness. （Sidgwick １８８５［１９０４］, p. １８１）
Smith and orthodox political economy in England have been admired for their balanced recognition of the indispensability of the governmental role from which laisser faire or Manchesterthum has deprecated. Although Sidgwick’s attitude was moderate or even critical against the accompanying shortcomings, he had “expressed a great deal more optimism about the efficacy of government intervention”（Medema ２００９, p. ５３）.
Then he proceeds to examine the criticisms from German historical school against the deductive reasoning of English economists. He was skeptical of the hypothetical and mathematical approaches for their inclination overlooking empirical facts, so he expresses a certain degree of sympathy for German critics such as Hildebrand and Knies. It is fair to say that Sidgwick’s attitude was neutral. However, his “The statesman’s decision on any particular case it does not belong to abstract theory to give; this can only be rationally arrived at after a careful examination of the special
main object at the time was no less to defend orthodox political economy against excessive criticism by appraising the function of competition as mainly sound.
［T］he danger now is rather that we should go into the opposite extreme, and not give sufficient attention to the more latent and complicated but very effective manner in which competition is found operating even in states of society where the barriers of custom are strongest.（Sidgwick １８８５［１９０４］, p. １８６）
Finally, he firmly criticizes sociologists’ attacks on political economy. In spite of the rightfulness of their claims to the need for grasping the social organism or the fundamental laws of social development, sociology is “still in its infancy” where disagreement and discontinuity among influential scholars are prominent; discussions such as those by Comte or Spencer have been “constructed on the basis of personal feeling and experience”（Sidgwick １８８５［１９０４］, p. １９４）. The severe problem Sidgwick could not permit was their eloquent prediction of the future development of society in ignorance of empirical studies:
［I］t seemed important to show how completely the delusive belief that he［Comte］ had constructed the science of sociology could transform a philosopher of re-markable power and insight into the likeness of a crazy charlatan. . . It is our business in the meantime to carry on our more limited and empirical studies of society in as scientific a manner as possible.（Sidgwick １８８５［１９０４］, p. １９７１９８）
Except for academic arguments, Sidgwick seldom engages in specific economic issues directly in his The Principles of Political Economy. Nevertheless, it cannot be denied that it had been most affected by contemporary issues of the late nineteenth conditions of each practical problem. . . But abstract reasoning may supply a systematic view of the general occasions for Governmental interference”（ Sidgwick １８８５［１９０４］, p. １７６）.
Speaking accurately, he mentions the importance of statistical approaches at the end of the address.
century. The economic situation differed from that of J. S. Mill’s time. Given the comparatively healthy economy after the repeal of the Corn Laws―which was the argumentative topic for economists as exemplified by the notable controversy between Ricardo and Malthus―by the hand of Prime Minister Robert Peel in １８４６, Mill’s Principles of Political Economy published in １８４８ had been regarded as a decisive volume. The authority of political economy as an independent scientific subject had reached its height. It was also marked as the turning point of economic pol-icy from protection to free trade. Here, while the idea of laisser faire or free com-petition supported the advocacy of free trade, it seemed that the righteousness of economic theory had been justified by steady economic conditions.
However, those ‘halcyon days’ of political economy had ended in the １８７０s. Sidgwick underlines two main triggers: Mill’s repeal of the Wage-Fund Theory which caused “an unexpected shock” on his disciples, and Jevons’s publication in １８７１ of the Theory of Political Economy, which criticized Mill’s doctrine with “exagger- ated and violent” tone（Sidgwick １８８３［１９０１］, p. ４; p. ９）. Furthermore, the finishing blow was the outbreak of the Great Depression―it is also designated as the Long Depression―since １８７３, which had lasted more than twenty years. Eventually, politi- cal economy had lapsed into a state of controversy, generating the harsh and fun-damental criticisms described above.
In this difficult phase, Sidgwick’s aim was to rebuild orthodox political economy by eliminating “unnecessary controversy”（Sidgwick １８８３［１９０１］, p. ７）. Probably his repeated emphasis on the idea of laisser faire would be the key. Laisser faire, by his definition, rests on the principle that “every man is the best judge of what contributes to his own happiness”（Sidgwick １８８３［１９０１］, p. ４２５）. He certainly ad-mits its adequacy to a degree, but also insists that it has not been regarded as
uni- “It seemed that the science had at length emerged from the state of polemical discussion on fundamental notions and principles, and that whatever further remained to be done would be building on a foundation already laid. J. S. Mill’s language had a considerable share in producing this belief”（Sidgwick １８８３［１９０１］, p. １）.
“［T］he economic argument for Free Trade―which is a simple application of the general argument for laisser faire―is now generally admitted as decisive”（Sidgwick １８９１［１９０８］, p. ３０３）.
versally valid from empirical grounds, and that unconditional laisser faire has “too optimistic reliance on the ultimate tendency of mere self-interest”（ Sidgwick １８８３［１９０１］, p. ５９０）. Thence the need for governmental interferences would be
rec-ognized “as not merely a temporary resource,” but “a normal element of the or-ganisation of industry” where the inadequacy of laisser faire is admitted（Sidgwick １８８３［１９０１］, p. ４１４）.
At the same time, his attitude was coordinated to the claim of laisser faire in some respects. One reason is that self-interested behavior is the indispensable driving power for the maximization of social production in the present economic condition. While separating orthodox political economy from unqualified laisser faire, he also states that “［s］till it remains true that ‘orthodox’ Political Economy, in England no less than on the Continent, has generally included an advocacy of Laisser Faire’（Sidgwick １８８３［１９０１］, p. ２２）. Another reason is that even in the case in which the defects of laisser faire are palpable, the drawbacks of governmental interference should not be overlooked such as the danger of governmental power used for corrupt purposes, the danger that the economic functions will be hampered by sectional interests, and the danger of wasteful expenditure under the pressure of popular sentiment（Sidgwick １８８３［１９０１］, p. ４１４）. In addition, he warns against the danger of overburdening the governmental machinery, and the disadvantages of governmental management of industry contrasted against energetic management by private interests.
Consequently, Sidgwick felt a special need to examine and exclude the confusion of value judgment in the proposition of laisser faire. At this point, we shall examine the most apparent characteristic of the Principles of Political Economy ―the distinction between Science（Book Ⅰ and Ⅱ）and Art（Book Ⅲ）. The idea comes partly from Bentham’s economic idea trying to build up the Art of Political Economy on the scientific basis of Smith’s Wealth of Nations; and partly from Sidgwick’s own
philo- In The Elements of Politics, Sidgwick more clearly says that laisser faire rests on two assumptions. First is that “individuals are likely to provide for their own welfare better than government”. Second is that “the common welfare is likely to be best promoted by individuals promoting their private interest intelligently”. Nevertheless, he insists that “［n］either assumptions is not completely true”（Sidgwick １８９１ ［１９０８］, p. xvi）. Bentham １７９３９５［１９５２］; Bentham １８０１０４［１９５４］.
sophical concern about the need for removing the confusion between ‘what is’ and ‘what ought to be,’ which is also generating the gap between ‘theory’ and ‘practice’ （ Sidgwick １８９５）. Actually, he repeatedly discussed the latter problem from the
first edition of the Methods of Ethics（Sidgwick １８７４, pp. １７１８）until his posthumous work, Philosophy its Scope and Relations. The determination of the relation―or the reduction of ambiguity―between ‘what is’ to ‘what ought to be’ ” was “the final and most important problem of philosophy” for him（Sidgwick １９０２, p. ９５）.
Although it remains as unresolved, he thought it valid to distinguish both spheres in political economy to sweep away the confusing arguments. The theme of the science of political economy or economic science is to examine actual economic society merely from the viewpoint of ‘what is’ by eliminating value judgments re-lated to ‘what ought to be.’ He specifically examines the behavior of each ‘economic man’ seeking one’s own interest in a free market. Although ‘economic man’ or free competition differs from ‘ordinary human’ or actual economic conditions, he defends these hypothetical approaches as valid and even impossible to grasp the complicated economic functions（ Sidgwick １８８３［１９０１］, p. ２３; ３８６）. Rather it is characteristic of economic science to be partially distinguished from ‘general science of Society’ for its theoretical sophistication since Adam Smith. At the same time, his intention was to underscore the necessity of empirical studies grasping concrete factors from which abstract theory has often passed over, and to define and distinguish the cases of important deviation clearly from free competition such as monopoly or combination.
The theme of the art of political economy is to clarify “what ought to be done by government to improve production and distribution, and to provide for expenditure” （Sidgwick １８８３［１９０１］, p. xix）. Here, the righteousness of normative governmental
interference is judged by whether its benefit exceeds its shortcomings and accom- panying costs or not. In production, although individual free economic behavior would be presumed as the driving force, some room exists for governmental provisions
See also Sidgwick １８９１［１９０８］, p. ２９２.
However, the general science of Society was“only in a rudimentary condition”（Sidgwick １８８３［１９０１］, p. ３２）.
of roads, canals, harbours, and so forth. In distribution, as Winch states that “［m］ost of the other cases to which Sidgwick gave prominence in his treatment of the art of political economy pointed in a more collectivist or socialistic direction”（ Winch ２００９, p. ２２５）, Sidgwick admits the efficacy or necessity of redistribution to increase general happiness. However, it is also noteworthy that he was aware of the drawbacks described above, or the possible decrease of social production through its harmful effect on self-help.
In his view, although political economy originally had been regarded as a branch of general arts of government, Smith had systematically introduced scientific methods. However because “the doctrine of laisser faire, characteristic of Adam Smith and his school, belongs to art”（Sidgwick １８８３［１９０１］, p. ix）”, there had been generated a tendency to confuse the hypothetical state of free competition with the normative proposition. Sidgwick’s attitude on laisser faire described above might give an ambiguous impression to readers. For example, on the one hand, he insists that “this doctrine, so far as it is sound, is evidently the most important conclusion of Political Economy considered as an Art”（ Sidgwick １８８３［１９０１］, p. ３９９）; but on the other, “I see no reason to regard unqualified laisser faire as tending to realise the most economical production any more than the best possible distribution of wealth”（ Sidgwick １８８３［１９０１］, p. ５２９）. However, firstly, his aim was not merely to defend or criticize laisser faire, but to examine the benefits and shortcomings of competitive markets and economic society systematically from the view of ‘what is’ by carefully removing the value judgment. Then, based on this scientific knowledge, we must consider the normative problem of ‘what outgo to be.’ And the practical criterion of economic policy, which he held as the most value-free and non-dogmatic, was nothing other than utilitarianism―the maximization of general happiness based on consequentialistic hedonism.
“［S］ince Cairnes, the majority of English writers who have regarded Political Economy as a scientific study have taken substantially the same view of its scope”（Sidgwick １８８３ ［１９０１］, p. ２８）.
４. Concluding Remarks
In the shadow of the Long Depression, harsh criticisms against laisser faire or individualism arguing the superiority of socialism or collectivism became heated. It was clear for Sidgwick that “the universal practice of modern civilised societies has admitted numerous exceptions to the broad rule of laisser-faire”（ Sidgwick １８８６［１９０４］, p. ２０２）. Therefore based on Science-Art distinction, he tried to cut off “unnecessary controversy” in The Principles of Political Economy. Furthermore, in the first half of the Elements of Politics, Sidgwick examined the desirable role of government in a comprehensive manner based on his political economy. Here his concern was again guided at showing the limitation of laisser faire by examining the respective benefits and shortcomings of individualistic and socialistic interfer- ences. The problem was not the choice between two schemes but how to maximize social happiness. From this utilitarian perspective, although he defends individualism and proposes ‘individualistic minimum’ of governmental interference, he denies ‘socialism in a narrow sense’ or ‘collectivism,’ which demands greater equality in wealth and governmental management of whole industries, because they would lack briskness and eventually bring about “equality in poverty”（ Sidgwick １８９１ ［１９０８］, p. １５９）. However, simultaneously, he admits the necessity of ‘paternal
in-terference’ or ‘socialistic inin-terference’ exceeding ‘individualistic minimum’ to an ex-tent from the view of the general happiness such as provisions of road and commons, regulation of the common use of sea and forests, and so forth.
Consequently, as already described by early studies, Sidgwick certainly repre- sents an important shift to admit the increasing role of governmental intervention “［E］ven in the more or less ideal society of intelligent persons which is contemplated in the traditional argument for laisser faire, there is no reason to suppose that a purely individualistic organisation of industry would be the most effective and economical”（Sidgwick １８９１［１９０８］, p. １５１）.
“ ［T］he Right of personal security, including security to health and reputation, the Right of private property, together with the Right of freely transferring property by gift, sale, or bequest, and the Right to fulfilment of contracts freely entered into” （Sidgwick １８９１［１９０８］, p. ５５）.
coping with market failures. Furthermore, to justify the efficacy of these governmental interferences, it would probably be necessary to have some discussion of the suitable structure or constitution of government to administer power for or against individ- uals. Actually, this was the central topic in the second half of the Elements of
Politics and The Development of European Polity, in which Sidgwick sought to analyze
it from the proper balance between democracy and aristocracy. The development of democracy was not the perfect prescription because he felt the danger of its power used to suppress the interests of a minority or even of a whole society in the name of a majority. The mode of democratic progress at the time was promising but too acute in his eyes. Therefore, Sidgwick defended the efficacy or necessity of aristocratic elements as its qualified knowledge, which is indispensable to cope with difficult and complicated political issues from the view of true social happiness, even when the merit of democracy is evident. In any way, although skeptical about the rapid development of democracy, he displayed a certain amount of optimistic vision that the shortcomings of governmental interference would be diminished to some degree through political progress.
Finally, it is interesting to take notice again that many readers―including B. Russell and J. M. Keynes despite their admiration of Sidgwick simultaneously― have regarded him as ambiguous in spite of his highly elaborated and systematic discussion. One reason can be understood from the fact that he sought to comprehend philosophical problems by emphasizing the need for practical and empirical approaches. In fact, ‘practice’ is a key idea incorporated in all of his academic works, which would be assembled into a system of philosophy called ‘Practical Philosophy.’ It also makes an important discrepancy with J. S. Mill or new liberals such as T. H. Green, whose stance to be called more or less as idealistic or perfectionistic, “［T］hese disadvantages are largely such as moral and political progress may be expected to diminish; so that even where we do not regard the intervention of government as at present desirable, we may yet look forward to it, and perhaps prepare the way for it” （Sidgwick １８８３［１９０１］, p. ４１６）.
Through his posthumous work, Philosophy its Scope and Relations published in １９０２, we can ascertain his entire idea of Practical Philosophy where ethics and politics are placed as the main axes, respectively. Political economy is a part―but important part―of politics for him.
especially when they place the development of altruistic humanity as a key to the solution of social issues, at least in the future. He would never be so ambiguous or dualistic if Sidgwick could convince him that such a possibility will become more important in practice. However, such a view seemed to him as dogmatic, or at least discussing its future possibility would go beyond the scope of practical studies of “modern societies as they actually exist”（Sidgwick １８８３［１９０１］, p. ３９２）. In fact, he criticized such idealistic views related to the implementation of self-sacrifice as a desirable humanity, or the replacement of individualism by socialism as a desirable social development. It is therefore no exaggeration to say that this practical and empirical attitude―though it might be inseparable from his skeptical and conservative aspects―make him propose moderate and constructive perspective in political economy which eventually succeeded in becoming a stable bridge between orthodox political economy and welfare economics in the harsh economic conditions.
Another, and a related, reason can be inferred from his careful attitude on the problem of value judgment. It was a keen philosophical concern for him to eliminate any confusion or dogmatism in value judgment based on empirical hedonism. In
The Methods of Ethics, he sought the ultimate principle of individual behavior, and
finally arrived at the dualism of practical reason; the conclusion had often been criti- cized as ambiguous and indecisive. However, he had never changed it because a view of humanity cutting off either egoistic or altruistic aspects seems so dogmatic in his eyes. Furthermore, the most salient characteristic of his political economy is probably that he explored it based on these ethical and philosophical beliefs. The ultimate end for economic interference of government was nothing other than the maximization of general happiness obtainable from wealth and services. Both individualistic and socialistic interferences are indispensable to realize “a com- pleter harmony of interests”（Sidgwick １８７４［１９０７］, p. ４３５）. It would not be achieved solely through free economic behavior of individuals, or through the development This character is also obvious on the matter of poor law, where Sidgwick describes a certain necessity of introducing a socialistic system to complement the defects in individu- alism such as the national insurance system in Germany, although he strongly criticizes the shortcomings of such interference in diminishing or discouraging self-help. See also Winch ２００９.
of altruistic humanity suppressing self-interest. In other words, he ended up showing a way to turn down the ideological confrontation between individualism and socialism based on utilitarianism. He was not an apparent type of liberal: the primary aim in his political economy was not the realization of individual liberty or freedom of choice itself, but the maximization of general happiness. Furthermore, he took utilitarianism as the guiding light of political economy because he was convinced that it was the most objective and reasonable measurement of rightness for most people who might have their own respective value judgments. In spite of the rec-ognition of the need to extend governmental interference, the comprehensive and universal essence in his utilitarianism remained to be regarded as old and moderate liberalism based on an individualistic foundation. Now utilitarianism is not popular, especially in ethical and political contexts. An important criticism against utili-tarianism was made by Rawls, who discerns its connection with economics, and sharply criticizes the inherent drawbacks from the view of political liberalism. However, it does not necessarily mean that utilitarianism has no liberal aspects at all. Rather Sidgwick’s utilitarian economic thought shows a possible accordance with liberalism.
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