Essentials of Economic Theory: As Applied to Modern Problems of Industry and Public Policy

John Bates Clark was the first American to gain an international reputation as an economist. In 1885 he and two colleagues, Richard Ely and Henry Carter Adams, organized a group that became the American Economic Association. Clark served as its third president, and the organization now bestows one of its highest awards, the John Bates Clark Medal, in his honor. Born in Providence, Rhode Island, Clark graduated from Amherst College and then studied economics at Heidelberg and Zurich universities. After his return to the United States, he married and took a position at Carleton College, where he befriended an unpopular but promising undergraduate named Thorstein Veblen. During his stay at Carleton, Clark contracted a severe illness that was to sap his strength for the rest of his life, forcing him to organize carefully all of his activities. Despite this handicap, Clark managed to produce an important series of works over the next few decades. In 1881 Clark moved to Smith College, where he published his first work, The Philosophy of Wealth (1885), a volume based on a series of articles on economic theory and contemporary business organizations originally published in The New Englander magazine. His second important work, Capital and Its Earnings (1888), advanced many propositions of modern capital theory, including the view that capital "transmutes" itself from one machine to another as old machines wear out during the production of newer ones. After a brief stint at Amherst, Clark went to Columbia University in 1895, where he taught until 1923. His third and most important book, The Distribution of Wealth (1899), is recognized as the first American economic work in pure theory. It is noted for its discussion of statics versus dynamics, economic terms introduced by Clark. Clark also published The Control of Trusts: An Argument in Favor of Curbing the Power of Monopoly by a Natural Method (1901), which argued for limited government intervention to restore competition. A revision, jointly published with and largely revised by his son, appeared in 1912 and offered a stronger case for antitrust policy. The 1912 edition (revised in 1914) was important because it conferred academic respectability on antitrust activity. In the final years of his life, Clark became involved in the peace movement.