Luigi Pasinetti and the“Great Economists”
Maria Cristina Marcuzzo
My aim in this paper is to single out the authors who have played a central part in Pasinetti's interests, and from there go on to define what I see as the peculiar features of his approach.
As far as the authors are concerned, he has dwelt most on Sraffa, Keynes, Ricardo（and to some extent also Wicksell and Quesnay）, but has also taken a considerable interest in Kahn, Joan Robinson, Kaldor and Goodwin, who were the friends, colleagues and companions in arms in various intellectual and academic battles with whom Pasinetti shared everyday Cambridge life, and with whom he is universally associated with reference to a common“school”-the Cambridge school, of course.More recently, however, Pasinetti began to take a fresh look at other economists of the same generation but in other“schools”, like Hicks, Modigliani and Samuelson, recording their features in small or relatively large portraits.
Characteristic of Pasinetti are respect for other sources, accuracy and references to facts and texts, and the impeccable rigour of a style sparing in adjectives but rich in details.
Let us take the case of Sraffa to begin with.Pasinett'i s detailed close scrutiny of P roduction of Commodities is to be seen in chapter V of the Lezioni di Teoria della Produzione of 1975, a text that for many years and for many students and scholars has stood as a major landmark in approaching Sraffa's book.
As early as the celebrated paper of 1960, “A mathematical formulation of the Ricardian system”, he drew extensively on Sraffa's Introduction to Ricardo's Principles, together with Kaldor's 1956 text（“Alternative Theories of Distribution”）.In this article, however, Pasinetti disregarded the issue and the importance of the corn-ratio in the evolution of Ricardo's thought, arguing that it represented, he believed, “a position...in itself highly vulnerable”, and was abandoned by the author“long before writing the Principles”（Pasinetti, [1974]1977:10n）.Actually, it was Sraffa himself who pointed out that Ricardo“maintained”this position untill 1816——not“long before”, that is, but up to the year immediately preceding the first edition of the Principles, when he abandoned it in favour of the labour theory ot value.Seeing how large this issue was to loom in the subsequent literature, this first approach shows Pasinetti then leaning more towards“rational reconstruction”than“historical reconstruction”of the history of ideas（on this distinction, see Blaug（1999））, although he began to show increasing interest in the latter approach as from the mid-1980s.
The article reconstructing Sraffa's intellectual and human biography dating to 1985,still pervaded by the emotional impact of his death（in September 1983）, was read at a conference held in the memory of Sraffa in Turin in the December of 1983.It was with this text that Pasinetti began to show his flair as a historian, too.It emerges, for example, in his accurate reconstruction of the context of Sraffa's article on the relations between cost and quantity produced（in a special issue of, Annali di Economia in 1925）, and of the particular time in Sraffa's life when he faced judgement in a competitive examination for a Chair at the University of Cagliari, as well as the general picture of Sraffa's still essentially Italian world before his final move to Cambridge in 1926.Many years were to pass before Naldi（2001）was able to add some details to this reconstructed picture which, however, has continued to enjoy general consensus over time.
Sraffa's relations with Mattioli, Gramsci and Wittgenstein also come under the close, searching scrutiny of Pasinetti, and as far as I know the very extensive literature that followed, above all after the Sraffa papers had been made available at Trinity in 1994, revealed no significant imprecision nor prompted any major revision, although of course it led to further investigation into certain aspects.
Nevertheless, his treatment of the relations between Sraffa and Keynes is a rather special case, for here Pasinetti took a rather more wary approach than he was subsequently to follow.“It is difficult, ”he wrote, “to think of problems on which one might trace a direct influence of Keynes on the development of Sraffa's economic thought.But at the same time I find it equally difficult to find examples to the contrary”（Pasinetti,1985:327;1998:377）.
Similarly, his assessment of the relations between Sraffa and the Keynesian economists at Cambridge（Joan Robinson, Kahn and Kaldor）is rather more incisive, summed up in the observation that：
“in the post-second-World-War period [there was a]sort of intellectual independence...emerging in Sraffa's relationship with the group of Cambridge Keynesians（notably with Joan Robinson, Richard Kahn and Nicolas Kaldor）...In the post-war period, Sraffa does not use his theoretical scheme to go in the directions along which the whole Keynesian group is moving....At the same time, and similarly, in the 1960's, one could notice many difficulties in the opposite direction, namely on the side of the members of the Keynesian group, to assimilate the ideas contained in Sraffa's book...Joan Robinson tried very hard to assimilate the most important propositions of Production of Commodities, but I believe she has not been quite successful.Kaldor seems to have remained almost entirely extraneous to it.The same thing nay be said of Kahn”（Pasinetti,1985:329-330;1998:380-I）.
This, however, is a point I will be returning to later when discussing the volume published by the Cambridge University Press.
Apart from the two 1988 texts, one on income distribution, of the other on the circular process concept in Sraffa, we have to wait to 2001 to find Pasinetti again engaged in study of the sources, seeking further elements to add to his historical reconstruction of Sraffa's thought and works.The article in question addresses the issue of“continuity and change”, after an excursus into the Sraffa papers.The text is to be attributed to the context of a discussion on the reasons why Sraffa's 1925 article was not translated into English, in the first place respecting the author's express wishes and subsequently in accordance with the decision of the executors of his will（Actually, Pasinetti played a very active part in getting it reprinted in a volume of Scritti（Writings）by Sraffa for the publishing house il Mulino in 1986 and subsequently published in English in the Italian Economic Papers of 1992）.
Pasinetti himself tells us how he locked himself up in the Wren Library, Trinity, for fifteen trying“avidly to read notes and scripts, and files and files of papers”（Pasinetti, 2001:141）.The article that emerged from all this is a model of accuracy and conciseness, proposing a periodization of Sraffa's vast output underlying Production of Commodities into three sub-periods（1928—1931;1941—1945;1955—1959）, taken to correspond to three lines of thought.Subsequent studies by, among others, De Vivo（2004）and Kurz and Salvadori（2005）, who spent months at Trinity poring over the Sraffa papers, do not appear to clash with Pasinetti's approach.
Obviously there are other periodizations and interpretations（see, for example, a dif-ferent reconstruction by Garegnani（2005）and Rosselli（2005）on the 1927“watershed”）, but my point is that Pasinetti's“brief”archive excursus has come to stand as sound reference for historians of economics thought.
And so we come to Keynes, the other author that Pasinetti sought to interpret on the basis of the rational and historical reconstruction from the very outset.
The second chapter of this 1974 book（the Italian edition in 1977）, “The economics of effective demand”, now has the status of a classic in the literature, and as such has received widespread consensus but has also seen many marking their distance from it.Here, too, I shall limit my focus to Pasinetti's interpretation, comparing it with the transformations it went through in the subsequent works.In his 1974 book he presents Keynes's theory of investments with the famous step graph on the basis of which the various investment projects are ordered in decreasing scale, according to the expected rate of profit and the rate of interest.Since, however, the ordering is done by entrepreneurs, who classify the projects according to their expectations, Pasinetti argues that this procedure differs from the marginalist approach where, by contrast, the ordering emerges from the decreasing marginal productivity of the capital.Thus he writes：
“Keynes's ranking...is more akin to Ricardo's ranking of all lands in a decreasing order of fertility than marginal economic elaboration...there is absolutely no need to consider Keynes'marginal-efficiency-of-capital schedule as an expression of the marginal productivity theory of capital [which]necessarily entails an inverse monotonic relation between capital intensity and the rate of interest...In a slump situation the last project to be implemented might well be the least capital intensive of all, and therefore entail a decrease（not an increase）of the average amount of capital peremployed labour”（Pasinetti, 1974:43;1977:60）.
This interpretation has come in for a certain amount of criticism（see e.g.Bonifati and Vianello（1998））, on the grounds that in Keynes's ordering the returns expected on each investment good are not independent of the quantities of the others, and so relate to intensive rent rather than Ricardo's extensive rent, but this is not the point I mean to settle here.The point is that in this book, in contrast with the practice he would later adopt, and which I will be returning to, Pasinetti makes no use of text or context analysis（he cites the General Theory only once in relation to Keynes's refusal to adopt“pseudo-mathematical symbolic methods”）.
An unpublished letter from Joan Robinson to Richard Kahn dated 18 February 1933 may, for example, have been used in support of his thesis, or at least the part concerning Keynes's awareness of the issue：
“Maynard has been trying to find out what the marginal productivity of capital means. He says no reputable writer ever uses it”（King's College Archives, RFK/13/90/1/1236）.
When he returned to the issue, nearly 20 years later, Pasinetti took a more wary stance.Keynes-he wrote-could not have benefited from Sraffa's analysis of the neoclassical theory of capital, the only one able to offer a sound critique（p.202）of the neoclassical investment function, which Keynes was far from endorsing. This text（Pasinetti,1997）makes ample use of textual reference to the General Theory while the characteristics of ordering in the marginal efficiency of investment are more closely argued out.
As from the 1990s we find a change in Pasinetti's style of argument, based on examination of texts by Keynes and those interlocutors which had by then been made available（publication of the last 30 volumes of Keynes's Collected Writings dates to 1989）.
In 1991 Pasinetti published an article examining the issue of continuity versus discontinuity between the Treatise on Money and the General Theory, of importance in determining whether or not a“Keynesian revolution”occurred in the author's thinking and in general in 1936.Pasinetti's declared aim was to contest both the re-evaluation of the Treatise as the more important text（at least from the point of view of monetary theory）and the rewrapping of the General Theory as a Walrasian package with the application of simultaneous equations.In this article Pasinetti drew extensively on the textual sources（albeit only those published in the volumes ⅩⅢ, ⅪⅤ and ⅩⅩⅨ of Keynes 1971—1989）, to argue that：
“the behaviour of Keynes and the Keynesian group...aims at overhauling the foundations of the theoretical structure.The decision has been made to discard and put aside the paradigm of traditional neoclassical theory and lay the foundations for a new construction, a new‘paradigm'”（Pasinetti,1991a:48）.
And it was at this point that Pasinetti brought in a methodological distinction that, I believe, is indeed the key to understanding the line he has pursued as a historian of ideas. It is, he wrote, a matter of distinguishing between a“question of principle”and a“practical question”.On the evidence of the documents and texts published, the former leads to the conclusion that the attitude taken by Keynes and the Cambridge Keynesians was one“rejection of the old paradigm and commitment to constructing a new paradigm”（ibid:49）.The latter-which, curiously enough, Pasinetti terms“practical”-complete the design, filling in the gaps, wiping out the inaccuracies and developing compatible theories. To this task Pasinetti has dedicated all his energies.I will be returning to this point in the conclusions.
And so we come to the second group of authors examined by Pasinetti, who shared the common goal of bringing the Keynesian revolution to fulfilment.We will begin with Richard Kahn, to whom Pasinetti was particularly close in the last years of his life.
I cannot help bringing in a personal note here, for together we ensured that Kahn's papers were kept together, that his 1929 Dissertation was published in English, and that, on the other hand, a comment by Kahn on Production of Commodities, written at an age and in a context where his faculties were somewhat dimmed, should remain unpublished. After his death we edited together for the il Mulino publishing house an Italian edition of many of his writings（Kahn,1999）.
From the entry in Palgrave（1987）to the more ambitious article in the Proceedings of the British Academy（1991 b）, Pasinetti's work underlies a great deal of the scholarship upon which the subsequent literature developed, including my work.A point I wish to stress in particular is that it was Pasinetti who first helped reveal who was“that elusive figure who hides in the Preface to many Cambridge books”, to quote Schumpeter's quip as recorded by Joan Robinson（King's college Archives JVR i/8）.There are, of course, many points in interpretation of Kahn that see us taking slightly divergent positions.For example, I am not sure that the study of the Dissertation“may well contribute to piecing together the great analytical puzzle of the relations between Sraffa's critique of Marshall's theory of the firm and Keynes's macroeconomic theory, or, to put it in other terms, of the micro-foundations of Keynes's General Theory”（Pasinetti,1991b:427428）.In general, however, and on the particular issue of the importance of Kahn's role in the drafting of the General Theory, I feel much closer to a Pasinetti（and to Schumpeter, who first referred to Kahn playing a role approaching that of co-author）than to Patinkin and Moggridge, who underestimate it（Marcuzzo,2002）.
In the case of Joan Robinson, too, my work owes much to Pasinetti despite the differences in the aspects we have dealt with, except one, which belongs strictly to the history of ideas.Here I am referring to two questions that Pasinetti raised on the occasion of the first conference on Joan Robinson held in Turin over ten years ago.
The first question is:why did Robinson always attribute so little importance to the phenomenon of reswitching in her arguments against the theory of the marginal productivity of capital, despite having to some extent“anticipated”its existence five years before the publication of Production of Commodities? The second question is:how are we to interpret Robinson's remark that her“anticipation”of reswitching came as an insight prompted by reading Sraffa's Introduction to Ricardo's Principles?
As for the first question, Pasinetti recalls that Sraffa was particularly vexed with Robinson on account of her“anticipation without analysis”of the curiosum of the theory of production（as she had described it in her 1953 article and her 1956 book）; reference here is to a letter that Sraffa kept in his copy of the Accumulation of Capital, in which Robinson expressed her embarrassment.Pasinetti's theory is that this vexation accounts for the difficulty Robinson faced in addressing the subject after 1960; Pasinetti thus concluded with the hope that when the Trinity Archive was opened-consent had yet to be granted（the text was written in 1993, a year before they became available）-it would offer further evidence upon which his hypothesis could be verified.
In fact, a letter was found amongst the Sraffa papers that offers some evidence for interpretation.Robinson writes：
“Dear Piero:all the work that I have being doing the last 10 years has been much influenced by you-both our conversations in the old days and by your Preface...the idea that I had seen in a blinding flash was yours, because it came to me in terms of Ricardo's corn economy; but it was connected with TIME and it now appears is very much alien to your point of view（though to me it seems to fit perfectly well）.Since, quite apart from worldly success, I have had a lot of fun.I have a very deep feeling of gratitude to you. The fact that you reject it doesn't affect the case at all.Yours, Joan”（JVR to PS,18 June 1960, PS papers:D3/12/111/340-1; cit.in Marcuzzo 2005a:447n）.
Here we have confirmation that Robinson dates the insight as to the error in the theory of marginal productivity to 1951; much more interesting, however, is the clue to what exactly it was that she subsequently saw as being alien to Sraffa's point of view.
In a nutshell, the hypothesis prompted by the letter is that Robinson borrowed from the distinction between“the two points of view of difference and change”, misconstruing it（Sraffa,1951:xlix）.This Sraffa reconstructed as the problem addressed by Ricardo, who nevertheless failed to separate the question of the differences in the value of the product due to the conditions of production from that of the change in the value of the product due to variation in the distribution.
Robinson identified the distinction between difference and change as contrast and transition between two positions of equilibrium with different quantities of capital:since there can be no knowing whether the quantities of capital are different independently of a knowledge of the rate of profit, we cannot speak of a change, but only of a difference between one equilibrium position and the other（Marcuzzo,2005b:39-40）.For calculation of the marginal productivity, as for transition from one technique to another, a change in the quantity of capital is required, and this necessarily occurs over time.What we can observeand compare-on the other hand, are two situations with different quantities of capital at the same moment.The reference to“time”in Robinson's letter to Sraffa is probably to be accounted for thus.
Pasinetti returned to the issuing only en passant in the chapter of his latest book bearing the fine title“The woman who missed the Nobel prize”, but added nothing new.
Although Pasinetti drew neither on the Robinson papers nor those of Kahn to sort out these matters of interpretation, he nevertheless played a decisive role in preparing the ground for others to do so.Thanks also to his good offices, it has been possible to obtain Bank of Italy funding for the cataloguing of the papers of both（as well as those of Kaldor and Stone）at King's College, the college having declined to bear the financial burden.In return, it was conceded that the microfilms of the papers be given to the Bank of Italy, which then made them available to scholars.
Pasinetti dedicated fewer pages to the biographical and interpretative aspects of Kaldor than he did to Kahn and Robinson, but they are no less eloquent of the intellectual debt that he recognised as owing to him.
The same applies to Richard Goodwin, to whom Pasinetti refers as his“first teacher”at Cambridge（Pasinetti,1996:646）.
As we know, between Kaldor on one side and Robinson and Kahn on the other a taxing atmosphere of tension developed in Cambridge in the 1950s with an uneasy mix of affection, respect, jealousy and rivalry. Kaldor hoped to find in Sraffa“a sympathetic ear”, as we learn from a letter from Geneva addressed to him dated 19 August 1956, immediately after publication of Robinson's Accumulation of Capital, in which Kaldor expressed his unwillingness to return to Cambridge the following term, because：
“I just couldn't face being bullied by Joan and Kahn about the wonderfulness of Joan's book and how everything must be different from now on! ”（SP:C/151, cit.in Marcuzzo 2005a:450n.）.
Naturally, Sraffa did not openly take sides with Kaldor and kept well clear of thewhole business.We have no relevant documentation, but it seems to me evident and indeed noteworthy that Pasinetti was able to maintain a position of equilibrium and mediation in this context which earned him the respect, consideration and friendship of all.The reason for this lies not only in a personal trait but also in Pasinetti's position as an economist and the cultural mission that he had undertaken within the group of Cambridge economists.
The time has come now to consider how Pasinetti interpreted the essential nature of Cambridge economics, impressively combining his flair as a historian with his powers as a theoretician in latest book of his.I had occasion to comment on some parts of it in a workshop at the Universitàt Cattolica held to celebrate his 75th birthday, which saw us gathered together in discussion-on the express wishes of the guest of honour-in a constructive but also critical spirit.Here, however, I would like to advance some considerations on the approach and, more generally speaking, on the various ways of viewing the relations between the role of the economist in the strict sense and that of the historian of political economy.
Pasinetti（2007:61）holds that Joan Robinson, Richard Kahn, Nicky Kaldor and Piero Sraffa formed“a powerful school on the track of Keynes's economic theory”and, while recognising that in reality this“school”consisted of a group in which the strong intellectual and emotional links weighed no less than the differences in culture, attitude and political views, Pasinetti nevertheless holds that there was：
“something […]much deeper, that shaped their intellectual affinities or attractiveness and at the same time gave rise to their strong and stormy personal relationship”（Pasinetti,2007:63）.
That“something much deeper”, according to Pasinetti, lay in sharing a common approach to economics.My impression is, however, that if there really is a Cambridge approach to economics, this is a task that remains to be accomplished, more than the intellectual foundations to characterise what it meant to belong to this group of economists. Actually, it is a difference in emphasis more than substance——and here Pasinetti concurs, having chosen to subtitle his book“a revolution in economics to be accomplished”——but I believe it is important to bring it out since it relates to the methodological question as to what distinguishes the work of the historian from that of the economist in the strict sense.
It is part and parcel of the work of the“historian”to reconstruct theories, personal contributions and circumstances, and the historian must as far as humanly possible respect the context and texts, both published and unpublished.The latter, on the other hand, working on the basis of texts and documents but, if necessary, reaching beyond them, takes on the task of constructing a somewhat freer theoretical framework, taking off from the groundwork of the authors studied.In this sense the theoretician is authorised to settle differences and bring together lines underlying different intentions and conceptualisations in the various authors, or in one and the same author.
The most delicate point in this distinction between the work of the historian and the theoretician, which, significantly, has seen and continues to see those economists who find their place in the Cambridge tradition divided, lies in the compatibility between the approach taken by Keynes and the Keynesians and that of Sraffa and the neo-Ricardians.I feel that in our work as historians we must have no qualms about bringing out the differences, and must continue to cast light on all the evidence that helps us to understand the authors in their historical context.In our theoretical work we enjoy, in a certain sense, more“freedom”to interpret, integrate and combine concepts and propositions that were quite distinct when formulated.This does not mean making free and easy with the work of the historian, but having a clearer sense of the fact that a different aim is being pursued.
For example, when Pasinetti presents the concept of vertically integrated sectors:“as a quite clear and logical way to accomplish an integration of the two types of economic analysis, associated with the names of Sraffa and Keynes”（Pasinetti,1986:16）he is doing something that is not only legitimate, but also theoretically fecund.But when he goes on to add that these two types of analysis associated with Sraffa and Keynes“have originally stemmed from the same preoccupations（inadequacy of traditional marginal economics）and have built on the same common ground（classical economics）”（ibid）, he is saddling his proposed reconstruction with a justification that is neither necessary, nor necessarily true. Unlike Sraffa, Keynes was not fiercely opposed to marginal analysis, and he was certainly not enamoured with Ricardo or Marx.
Similarly, when, having written a book to demonstrate that a consistent and common theory can be constructed on the basis of the work done individually by certain Cambridge economists, Pasinetti chooses to entitle it Keynes and the Cambridge Keynesians, he is stretching the point since Sraffa, who certainly did not fit the description, is meant to be included.
Pasinetti has shown his great worth as a historian and theoretician, but has eschewed that distinction between the two lines which for my part I see as desirable.The reason may lie in the fact that it is not on the history of political economy that Pasinetti is to be appraised, but in the history of political economy, as a protagonist, that is, of a theoretical quest upon which depends the concrete possibility of an alternative to the many ways of doing economics today.