In this paper, we try to reinterpret Marshall's External Economies with the key con cept of “the knowledge on production methods.” In Section 2, through reexamining the criticism directed against Marshall's treatment of increasing returns, we outline the reason why we seek the possibility of “external economies at an industry level.” The consequence of the Cambridge Cost Controversy was quite legitimate as far as the adoption of the equilibrium method was premised. Marshall's representative firm cannot be supported when assessed strictly since it is a static concept that contains several dynamic forces in it. Surely, we need to adopt a dynamic method for dynamic phenomena, which Allen Young once maintained forcibly. But we differ from Young in that we consider a partial method to be useful in spite of the fact that he contended the analysis of increasing returns to be conducted in inter-industrial context.
In Section 3, the function of the organization of a firm is discussed from the standpoint of “the knowledge on production methods, ” which is the type of applicable knowledge that cannot be discovered and learned from basic principles nor restored as explicit knowledge. The characteristic of the knowledge on production methods is that both improving and learning take place only gradually through a trial-and-error process. So, time and stable environments are necessary for this type of knowledge to be utilized effectively. We show that internal economies can be interpreted as the economies of specialization and integration of production knowledge at a firm level.
In Section 4, we proceed to the reinterpretation of Marshall's external economies. What various firms in an industry face is the situation where the knowledge on the production methods is not in a complete form and is much diversified among them. Thus, an industry can be regarded as a place of competition over alternative production methods. Firms in an industry strive to improve their own knowledge while paying attention to the movements of other firms. Firms in the same industry can be viewed to comprise a kind of knowledge community where the knowledge on the production methods spreads and is shared. Although firms in the same industry are in a competitive relation, but are on the same vessel in another viewpoint. For, any progress in production methods carried out by one firm is a threat to others in the same industry in the short run, but contributes to the industry as a whole in the long run. The shared knowledge can contribute to unintended cooperation among firms that adopts the same production knowledge just as a commonly shared language does. Thus, standardization helps to economize coordination costs between firms in the same industry. The main contention of this paper is that Marshall's external economies can be reinterpreted as the economies available through the standardization of knowledge on production methods that takes place mainly at the industry level. Being reinterpreted in this way, Marshall's concept of external economies has a sufficient economic basis.

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In his doctrine of exchange, Steuart advanced a policy in which the exchange rate be kept at par by the state. He says that by a statesman's giving bills at par on all occasions, and being himself at the expense of transportation and insurance, in bringing home and sending off all balances, exchange would of itself come to par.
Today it is widely accepted that this policy of Steuart's is only a temporary expedient. It is said that Steuart intended this policy as an emergency measure meant to avoid an evil effect of the strong sterling rate. The statesman must not intervene under normal occasions; it is allowed only when the balance of payments is in his favor, and the strong sterling rate discourages exportation.
It is shown in this paper that this interpretation stems mainly from the following two factors. First, Steuart's theory is explained as a primitive equilibrium theory. Critics using this approach assert that Steuart's theory of political economy is fundamentally based on market mechanism, and that state intervention is allowed only as a temporary expedient. Second, they understood Steuart's term “high exchange” as “strong sterling rate, ” when Steuart points out that the “high exchange proves a prodigious discouragement to trade in general.”
But as we see in this paper, Steuart used this term to refer to a large detachment of the exchange rate from the par. A strong sterling rate, therefore, is expressed as “a price of exchange in favour of a country, ” and a very weak sterling rate is expressed as “high exchange against a country.” According to Steuart, the problem was not the high sterling rate, but the large fluctuations of the exchange. The detachment of the exchange rate from the par, whether it be over or under the par, “produces an instability in the profits upon trade.” Thus Steuart concludes “that it is greatly for the interest of a trading state to keep exchange, at all times, as nearly at par as possible.” This exchange policy enables bills of exchange to circulate according to the true sterling value.
The point I wish to emphasize in this paper is that this policy is a constituent of Steuart's monetary policy. Steuart regards bills of exchange as money, along with coins and bank notes. It holds true for bills, when Steuart states “It is of great consequence to a statesman to understand it (the doctrine of money) thoroughly; and it is of the last importance to trade and credit, that the money of a nation be kept stable and invariable.” Accordingly, Steuart enumerates this exchange policy, policy on coin, and policy on bank notes as three branches of “the whole policy of circulation.” In Steuart's theory of political economy, it is of great importance to appropriately supply circulation with stable and invariable money, and this doctrine of exchange must also be understood in this context.

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This paper is intended as an investigation of the relation between Pigou's ethics and his welfare economics. For this purpose, I shall introduce the basic ethical knowledge that originated with J. S. Mill. This knowledge provides the structure of ethics. On the whole, ethical theory has three elements, which include the facts about moral phenomena, fundamental principles, and practical principles (criteria). As it seems that the first does not require further explanations but the latter two do, some comments shall be appended to each of the latter. First, the fundamental principle is the ultimate grounds upon which all moral judgments will be prescribed. Because the fundamental principle supplies all concrete or applied practical criteria with their foundations of justification, its attributes must be quite abstract. At the same time, the fundamental principle is the ultimate end. That justification is based on usefulness to this ultimate end. Secondly, the practical criteria are concrete applications of the fundamental principle. The latter is so abstract that we cannot in practice use it as a criterion for moral judgment. The fundamental principle is, however, the ultimate criterion as well as the ultimate ground. Therefore we must embody the fundamental principle in some particular lines. There is, however, no absolute or unique embodiment (i. e., a practical criterion), for the best criterion may differ case by case.
From my interpretation of Pigou, what corresponds to the fundamental principle explained above is Pigou's theory of value: welfarism (i. e., ideal utilitarianism). Pigou says that welfare is composed of states of conscious life, each of which has intrinsic value, and that welfare is a complex whole. What should be noted is that as Pigou's theory of value (the fundamental principle) abstractly defines ultimate ends and criteria of moral judgments, it is impossible for us to make any judgments in practical concrete cases according to the fundamental principle. Therefore we must substantiate the fundamental principle for practical circumstances. Pigou, recognizing that point sufficiently, embodies welfarism in his economic theory; he considers economic welfare to be a concrete goal and defines propositions of production and distribution as means to that goal. This is one type of practical criteria. I would like to emphasize that because Pigou's original intention was to promote each individual's welfare ultimately, maximizing the total social economic welfare (a typical utilitarian prescription) is no more than one expedient for the former. Accordingly, considering the ultimate end, we can see that it is possible to choose another practical criterion instead of economic welfare. For instance, justice in distribution could be fully supported by Pigou's fundamental principle (welfarism), to which little attention has been given. Put another way, in Pigou's system, the principle of justice or right is not independent of the principle of utilitarianism; more accurately, the former is subordinate to the latter. In fact Pigou's national minimum theory, which implies distributive justice, is prescribed from his utilitarian point of view.

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The purpose of this paper is to compare the arguments of D. Hume and A. Smith with those of F. A. Hayek, a representative of modern liberalism, based on analysis of the justice theory, and to explain common ideas and differences between them.
While the thought of Hayek is based on a Kantian position, that of Hume and Smith is based on Scottish tradition. They share, however, a common viewpoint of “Empirical natural jurisprudence.” As such, although they differ in their ideological bases, there are ways in which Hayek paid close attention to Hume and Smith.
Hayek names his liberalism “anti-rationalism” and believes Hume and Smith to be his pioneers. The arguments of these three philosophers have in common the concept of a negative justice theory based on the natural law tradition. Hayek inherited the idea of “the sense of justice” from Hume's notion of “a general sense of common interest” grounded on “conventions.” In addition, he succeeded in criticizing the “man of system” who will design or construct social order by a human's pure reason, and Smith's concept of a “great society.”
While these three philosophers dismiss the notion of a human's pure reason (ex., Descartes), the foundation of reason from a theological perspective (ex., Hutcheson), and law positivism (ex., Kelsen), they ask for an historical and secular formation of the foundation of a natural law (or natural jurisprudence). The above constitutes their “Empirical natural jurisprudence”. The traditions of natural law before Hume were based entirely on teleology or Platonism. But Hume and Smith eliminated both teleology and Platonism from their notion of natural jurisprudence. Hayek inherited this perspective from both and combined it with his Kantian position. More specifically, Hayek's social theory belongs to a genealogy of natural jurisprudence that has historical and Kantian-transcendental character. “The sense of justice” that is historically formulated operates as a “Kantian-regulative idea.”
The justice theories of Hayek, Hume, and Smith are all based on the “limited generosity” of humans, a “scarcity of a sufficient means of desire, ” and “self-interest.” For the three philosophers, general “law” appears to be a “reasonable expectation” formed over the long run throughout history.
There are, however, differences among these three with regard to what they believed to be the appropriate role of government and to “cultural evolution.” Although Hayek believes in the idea of spontaneous order, in which evolution occurs as an unintended result of human action, Hume and Smith were deeply aware of the need for artificial roles in the evolution of various institutions.
In Hayek's theory, there is no concept of “sympathy” or “virtue, ” as seen in Hume and Smith. This point greatly separates both Hume and Smith from Hayek. If we compare Hume and Smith, Smith respected virtue more than Hume, and Hume considered custom to be more important than did Smith. Such differences in their theory result from methodological differences, and they are important to their differences in their social theory, especially concerning the problems of government and the public sphere. Smith's concept of “sympathy” was more sophisticated than that of Hume, and he established the unique concept of an impartial spectator. In contrast, Hayek developed the idea of abstract knowledge (based on Kantian-apriorism).

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This paper surveys mainly the monograph literature regarding Tokugawa economic thought. Considering what the scholars intend to find through their studies, the present article divides the field into four main groups:
(i) A view based on the stage theory of development or the concept of European economic thought. In this category are included two kinds of works which attach much importance to the stage theory based on Western economic development. A group of scholars comment on the backwardness of Tokugawa economic thought as compared with the Western economic thought which was imported after the Meiji restoration. Another group tries to analyse Tokugawa economic thought in terms of such European concepts as mercantilism or physiocracy. Recently, the scholars of this category make use of their theories more flexibly than previously, as a tool to grasp the character of Tokugawa traditions.
(ii) A view regarding Tokugawa period as the cradle of Japanese economic growth. The scholars of this category consider that the relatively smooth process of Japanese industrialization was prepared in Tokugawa period. These scholars therefore examine the development of knowledge and thought adequate to the burgeoning market economy of that period. Though they provide some valuable analytical insights into Tokugawa economic thought, some of them might describe the ideas of that period as a too modernised aspect.
(iii) A view evaluating Confucian economic thought and a view influenced by the post-modern theories. Some scholars in this category think the modern economic society is reaching its limit and evaluate the harmony between economy and morality in Tokugawa Confucianism. Also represented in this category is work inspired by postmodern theory. This kind of study tries to understand the structure or network of miscellaneous discourses, excluding the modern prejudices. Surely this approach shows the world of the thoughts in a certain period realistically, but it should also consider how to regard the world of this period within the context of chronological history.
(iv) An attempt to discover the traditions of economic thought by non-professional thinkers. The scholars of this category find much meaning among the economic thought produced by such non-professional thinkers as samurai-bureaucrats, village masters, intelligent merchants, and so on. These scholars evaluate such non-professional thoughts as having a character of their own, finding new materials concerning this kind of subject. However, most of these attempts have not yet been able to connect such thoughts with the whole body of Tokugawa economic thought.
The major publications of each of these categories are critically introduced. The general conclusion is as follows. The divisions that have so characterized the field will be perpetuated in some form. But there is a sense that the very virulent and sterile phase of controversy is spent. Though marked by wide differences in approach and broad diversification of subjects, this field of study is maturing, and the described categories are going to stimulate constructively to one another.

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“Economics was primarily an Italian science until the last quarter of the eighteenth century”. Thus, an oracle of Schumpeter has inspired a few Japanese scholars to investigate Italian precursors of modern economic theory, with special regard to F. Galiani. But the cynical Galiani was also, as Ajello points out, a machinist of ‘illuminated’ absolutism by which Queen Maria Carolina corrupted every serious effort of Neapolitan Philosophes and transformed them into a ‘mimic’ of reform.
The aim of this paper is to verify, under such circumstances, the Fortuna of the socalled Genovesian tradition (by Di Battista), which had been celebrated by the ‘first’ chair of political economy in the world (1754).
In the European-wide circulation of economic thought, Antonio Genovesi had chosen Great Britain as a model of civilized commercial society, though he criticized its tendency toward imperialism and foretold a postcolonial crisis. His Economia civile was an idealization of England in which property rights should be ensured by the equity of justice and everyone's industry can be stimulated by the domestic free trade, so that the development of a balanced national economy might be carefully protected by ‘mercantilist’ policies. Moreover, this idealization looked something like an Arcadia of virtuous gentries and independent free-holders. The reality of Southern Italy, however, did not permit such an eclogue. Therefore, the quest for a missing middle class (ordine mezzano) became the primary theme of the Genovesian tradition.
Among Genovesi's followers, young G. Filangieri expected a utopia of ‘American Liberty, ’ while old G. Palmieri, as president of the Supreme Council of Finances, pursued the transformation of feudal nobilities into modern landowners. His scheme, however, resulted in a kind of ‘cynic economy’ that imposed abstinence on the poor people.
Why the precocious ‘institutionalization of economics’ was ultimately fruitless (see the tragedy of 1799) remains mysterious. Soon after Genovesi's death in 1769, the Neapolitan Enlightenment had become gloomy, and there we may find in F. Grimaldi another example of exalting the Diogenean lifestyle, which sheltered freemasons and canalized them into the Italian Jacobinism. Regardless, further research is required with regard to the vast economic literature produced by the contemporaries of Genovesi and by the first generation of his disciples: G. B. M. Jannucci, N. Fortunato, F. Villano, F. Longano, M. Torcia, and so on.
During the Napoleonic era we finally encounter the solitary exception among the mediocre successors of Genovesian professorship: L. d. S. Cagnazzi was considered to be a pioneer of Smithianism in the Kingdom of Naples and a founder of the Italian school of statistics. However, Cagnazzi's substantive liberalism with regard to the macroeconomy was coexistent with his insistence on the minutest interventionism in the microeconomy, and “the role of a entrouvable [sic] bourgeoisie came to be occupied by a new class of bureaucratic-intellectuals” within such ‘administrativism’ (Salvemini). We therefore cannot easily conclude that there was a significant break nor a seamless continuity with the Genovesian tradition.
According to Robertson, who emphasizes the Venturian concept of the Enlightenment ‘above national context’, the Scottish and Neapolitan economists were exemplars “of the achievements of the political economy of Enlightenment.” Free trade and protectionism were two different but complementary alternatives that derived from a common intellectual framework of the cosmopolitan century. However, it must also be considered that the 19th century economic theories were influenced by the international diffusion of a classical political economy. As the honeymoon of cosmopolitanism

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