William Stanley Jevons

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William Stanley Jevons, English economist and logician, was born in Liverpool on 1 September 1835. Jevons was one of three men to simultaneously advance the so-called "marginal revolution." Working in complete independence of one another—Jevons in Manchester, England; Leon Walras in Laussane, Switzerland; and Carl Menger in Vienna—each scholar developed the theory of marginal utility to understand and explain consumer behavior. The theory held that the utility (value) of each additional unit of a commodity—the marginal utility—is less and less to the consumer. When you are thirsty, for example, you get great utility from a glass of water. Thirst quenched, the second and third glass are less and less appealing. Feeling waterlogged, you will eventually refuse water altogether. "...Value," said Jevons, "...depends entirely upon utility...."

His father Thomas Jevons (1791–1855) was an iron merchant; his mother Mary Anne Roscoe (1795–1845) grew up in an intellectual and artistic milieu. The railway boom crisis of 1847 caused the bankruptcy of the family firm. William Stanley Jevons went to University College School in London in 1850, and in 1851 to University College. He studied chemistry under Graham and Williamson, two pioneers in the development of atomic theory and the theory of molecular motion. Another major influence at University College was Augustus De Morgan (1806–1871), with his courses on mathematics and logic. Jevons left University College without taking his degree. In 1854 he travelled to Melbourne, in order to become an assayer at the Australian mint. Jevons devoted much time to private study. His work covered many different areas: railway policy, meteorology, protection, land policy, cloud formation, gunpowder and lightning, geology, etc.

Jevons left Australia in 1859 and returned to University College to complete his education. The early 1860s are important for Jevons' intellectual development, and he reports in his diary that he received significant insights in both economics and logic: a “true comprehension of value” (Black 1981: 120 ) and the “substitution of similars” (Black & Könekamp 1972: 179). Jevons received his MA degree in 1862, and was awarded the gold medal ‘in the third branch’ which included logic, moral philosophy, political philosophy, history of philosophy and political economy.

In 1863 Jevons became a tutor at Owens College, Manchester, and in 1865 a lecturer in political economy and logic. He now gave his principal attention to the moral sciences, but his interest in natural science was by no means exhausted: throughout his life he continued to write occasional papers on scientific subjects, and his intimate knowledge of the physical sciences greatly contributed to the success of his chief logical work, The Principles of Science. In 1867 Jevons married Harriet A. Taylor, and they subsequently had three children. The family moved to London in 1876, on his taking up a chair at University College. Jevons' short life came to an end in 1882, when he drowned near Hastings.

Main areas of work

Statistics & Mathematics

Like many other logicians of the 19th century, Jevons wants to establish clear links between mathematics ( mathematical statistics ) and logic. He would like to derive mathematics from logic, which is based on the Laws of Thought, and in doing so he makes (a rather controversial) use of mathematical symbols when establishing his logical formalism. Jevons denotes terms by capital letters A, B, C, etc. and their negative counterparts by small italic letters a,b,c, etc.

Statisticians in the first part of the 19th century were concerned with the collection of data, but not with analysis. In 1863 Jevons published A Serious Fall in the Value of Gold, which investigated the influence of Australian and Californian gold discoveries of 1851 on the value of gold. For this purpose he constructed index numbers making use of the geometric mean. He argued that multiplicative disturbances will be balanced off against each other when using the geometric mean. There is however no empirical verification of this ‘multiplicative disturbances’ hypothesis.

But Jevons worked on the limits of his mathematical understanding, and many ideas that he foreshadowed were not developed until decades after his death.

Jevons' use of statistics in the social sciences was inspired by Adolphe Quetelet. Jevons distinguishes between a ‘mean’ (the approximation of a definite existing quantity) and an ‘average’ or ‘fictitious mean’ (an arithmetical average). The fictitious mean is important, since it allows us to ‘conceive in a single result a multitude of details’. For instance, Jevons equates aggregate and average consumption: provided that the community under consideration is large enough, the average consumption of the aggregate community will vary continuously due to price changes, whereas individual behaviour is strongly affected by accidents.

If all individuals had exactly the same features (those relevant for consumption), then the average laws of supply and demand would be equal to the conduct of every individual. If however the “powers, wants, habits, and possessions” of different people were widely different, then the average would not represent “the character of any existing thing”. The accidents would cancel each other out and a certain ‘typical’ consumer would emerge. Although this is clearly a case of a fictitious mean, it would not be less useful: “....the movements of trade and industry depend upon averages and aggregates, not upon the whim of individuals...."

Jevons thus recognizes that people are not homogeneous and that it would be wrong to create ‘representative agents’ depicting individual behaviour. In the case of large aggregates however, disturbing causes would cancel each other out. Here Jevons brings in the large number argument. If however specific policy questions are at stake, the heterogeneity of different societal subgroups has to be accounted for. Jevons uses the concept of ‘character’ in order to bridge the gap between universal theory and characteristics of specific subgroups in society, as we will see in the next section.

Theory of Utility

Jevons arrived quite early in his career at the doctrines that constituted his most characteristic and original contributions to economics and logic. The theory of utility, which became the keynote of his general theory of political economy, was practically formulated in a letter written in 1860. He referred to, namely, that the degree of utility of a commodity is some continuous mathematical function of the quantity of the commodity available, together with the implied doctrine that economics is essentially a mathematical science, took more definite form in a paper on "A General Mathematical Theory of Political Economy," written for the British Association in 1862. This paper does not appear to have attracted much attention either in 1862 or on its publication four years later in the Journal of the Statistical Society; and it was not till 1871, when the Theory of Political Economy appeared, that Jevons set forth his doctrines in a fully developed form.

The theory of utility was at about 1870 being independently developed on somewhat similar lines by Carl Menger in Austria and Leon Walras in Switzerland, but this in no way detracts from the great importance of the service which Jevons rendered to English economics by his fresh discovery of the principle, and by the way in which he ultimately forced it into notice. In his reaction from the prevailing view he sometimes expressed himself without due qualification: the declaration that value depends entirely upon utility, lent itself to misinterpretation. But a certain exaggeration of emphasis may be pardoned in a writer seeking to attract the attention of an indifferent public. The Neoclassical Revolution, which would reshape economics, had been started.

It should also be noted that Jevons did not explicitly distinguish between the concepts of ordinal and cardinal utility. Cardinal utility implies that each utility from each good can be measured as exactly as weight could. While ordinal utility implies that the utility of a particular can be compared to the utility of another and ranked according to which good provided the most utility. Although Jevons never explicitly makes the distinction it is obvious that he preferred the concept of an ordinal utility.

Jevon’s Logical Treatises

Elementary Lessons on Logic, which soon became the most widely read elementary textbook on logic in the English language. In the meantime he was engaged upon a much more important logical treatise, which appeared in 1874 under the title of The Principles of Science. In this work Jevons embodied the substance of his earlier works on pure logic and the substitution of similars; he also developed the view that induction is simply an inverse employment of deduction; he treated in a luminous manner the general theory of probability, and the relation between probability and induction; and his knowledge of the various natural sciences enabled him throughout to relieve the abstract character of logical doctrine by concrete scientific illustrations, often worked out in great detail.

Jevons, for instance, introduces the logical alphabet – a series of combinations that can be formed with a given set of terms. For instance, A and B produce the four combinations AB, Ab, aB and ab. Using the logical alphabet, logic becomes simply an exercise of fully developing all terms and eliminating the contradictory terms. However, when the amount of letters increases, the amount of possible combinations becomes considerable. Jevons considers some techniques and devices to facilitate these endeavours, such as a ‘Logical slate’ (the logical alphabet engraved upon a school writing slate).

Nevertheless, when more than six terms are involved, it becomes almost impossible to solve the problem. To facilitate this kind of reasoning Jevons developed a logical abacus, which operates on simple mechanical principles. It can be seen as one of the first computers.

Jevons' general theory of induction was a revival of the theory laid down by Whewell but it was put in a new form, and was free from some of the non-essential adjuncts which rendered Whewell's exposition open to attack. The work as a whole was one of the most notable contributions to logical doctrine that appeared in Britain in the 19th century.

His Studies in Deductive Logic, consisting mainly of exercises and problems for the use of students, was published in 1880. In 1877 and the following years Jevons contributed to the Contemporary Review some articles on Mill, which he had intended to supplement by further articles, and eventually publish in a volume as a criticism of Mill's philosophy. These articles and one other were republished after Jevons' death, together with his earlier logical treatises, in a volume, entitled Pure Logic, and other Minor Works. It is, however, clear that Jevons's strength lay in his power as an original thinker rather than as a critic; and he will be remembered by his constrictive work as logician, economist and statistician.

Philosophy of Economics

Jevons seems to be a mathematical, deductive economist. Market prices are derived directly from a series of fundamental motive forces, such as "the mechanics of utility and self-interest". Markets are depicted in the most abstract fashion and economic agents are perfectly rational, perfectly foresighted and in possession of perfect information.

A perfectly rational human being would anticipate future feelings and include discounted future utility in his calculations. However, this ability varies according to certain circumstances, as there are "...the intellectual standing of the race, or the character of the individual..." (Jevons 1879: 34).

The ability of foresight depends on the state of civilisation: the class or race with the most foresight will work most for the future, because a powerful feeling for the future is the main incentive to industry and saving. Moreover, even the ‘quality’ of tastes increases with every improvement of civilisation. Jevons' conception of an economic agent should therefore be altered according to the institutional setting in which the agent appears (the class or race to which the individual belongs).

But the Theory contains ‘representative individuals’, which behave in the way required by the Theory. All economic actors do not have to behave in exactly the same way, but disturbing causes would balance and therefore the ‘representative individual’ may be an appropriate model for the Theory. The theory is however indeterminate in cases when more information is required. For example, it is unclear whether an increase in the real wage rate, proportionate to an increase in labour productivity, results in increased or reduced hours of work.

More information about the ‘character’ of the person under consideration is required: whereas learned professionals might be expected to work more severely, common labourers might prefer idleness over labour and prefer greater ‘ease’ in the case of rising real incomes. Irish labourers are said to be responsible for the higher mortality rates in several districts, because Jevons considered the Irish to be a race that would become more easily subject to drunkenness. The proper place of women is the home: women with children younger than three years should not be allowed to work, as this would only give rise no a neglect of the children, and would encourage the males to choose for idleness. In all these cases, the characters of labourers, Irish people or women are taken for granted, and are not in need of further explanation. The Victorian middle-class is used as a yardstick for evaluation.

Implications of Jevon’s Unitarism and Evolution for Economic and Social Policy

Although the bias regarding class, gender and race is obvious in Jevons' work, we should add that he was concerned with the amelioration of society in general and the condition of the working classes in particular. This attitude was inspired by the progressive and Unitarian middle-class background from which Jevons emerged.

In The Principles of Science Jevons devotes a (short) section on the theory of evolution, followed by a section on the possibility of divine interference (Jevons 1874, pp. 761-9).

Jevons embraces Spencer’s idea that the homogenous is unstable and differentiates itself in the process of evolutionary development. This explains why a variety of human institutions and characters emerged. He recognizes that evolutionary theory has not been proved, but nevertheless he adheres to its truthfulness.

The scientific basis of Jevons' economics is utilitarianism and the mechanics of utility and self-interest; like many Unitarians this scientific belief is combined with an emphasis on active interventionism directed towards more possibilities for self-improvement; and evolutionary theory does not only show that there should be development towards the ‘good’ and the ‘happy’, but also that there will be such a development (at least in Jevons' interpretation).

Jevons refutes the claims of some “sentimental writers” who regard economics as a “dismal science”, because its scope is restricted to wealth. These authors depict economics as a mechanical and miserable body of theories, whereas they hold true that a moral science should be concerned with sympathies, feelings and duties. Jevons uses an analogy from the natural sciences to refute this opinion: division of labour implies that some people investigate the mechanical aspects of iron, while other researchers devote their time to the study of its electrical or magnetic aspects.

Comments to some of the Jevon’s work

"…it is in his essays on the application of economics to the theory of governmental action that his full greatness is best seen. There is no other work of the kind which is to be compared to them for originality, for suggestiveness, and for wisdom…….Jevons was a man as remarkable for modesty of character and generous appreciation of the labours of others as for unwearied industry, devotion to work of the highest and purest kind, and thorough independence and originality of thought….." ( Proceedings 1983 ).

Keynes’ comments on Jevon’s The Theory of Political Economy(Jevons 1866 ): “……..simple, lucid, unfaltering [work], chiselled in stone where Marshall knits in wool........“ (Keynes, p.131) and on Coal Question ( Jevons 1865) : „..It is most brilliantly and engagingly written, with nothing omitted which could add to its attractiveness and the effect of its impact. ...... its prophesies have not been fulfilled...“( Keynes, p.122).

"....he was the pivotal figure in laying the foundation of modern economics as a natural science. Harro Maas notes that his work owes much to joint meetings between economists and physicists on measurement. He approvingly quotes J. M. Keynes's characterization of Jevons as "the prying eyes" that peered into statistical data with the tools and patience of the natural scientist. Jevons showed that deliberations designed to maximize utility by analyzing the marginal increments of utility to be derived from economic actions could be described as mathematical functions and has been credited with introducing the calculus to the discipline...."( Maas 2005 )

Selected Bibliography

Black, R. D. C. & R. Könekamp (eds.) Papers and Correspondence of William Stanley Jevons Volume I. Biography and Personal Journal. London and Basingstoke: MacMillan, 1972
Black,R.D.C. , (ed.) Papers and Correspondence of William Stanley Jevons Volume VII. Papers on Political Economy. London and Basingstoke: MacMillan1981..
Jevons, W.S. The Social Cesspools of Sydney No. 1. — The Rocks. The Sydney Morning Herald, October 7, 1858, typescript provided by Michael V. White[1858].
Jevons, W. S. 1863b. "Notice of a General Mathematical Theory of Political Economy." Report of the British Association for the Advancement of Science, Cambridge, 158-9.
Jevons, W. S., The Coal Question, York: Augustus M. Kelley, [1865, 1906], 1965.
Jevons, W. S. [1866]. "Brief Account of a General Mathematical Theory of Political Economy." in The Theory of Political Economy. New York: Augustus M. Kelley, 1965, pp. 303-14.
Jevons, W. S., "The Substitution of Similars." in [1890] Pure Logic and Other Minor Works. Bristol: Thoemmes, [1869], 1991
Jevons, W. S. , The Theory of Political Economy. First Edition. London and New York: MacMillan and Co.,1871
Jevons, W. S. ,The Principles of Science: A Treatise on Logic and Scientific Method. London: MacMillan, [1874],1879
Jevons, W. S. , Money and the Mechanism of Exchange. London: Kegan Paul, Trench, Trübner & Co. 1875
Jevons, W. S. [1879, 1957], 1965. The Theory of Political Economy. Fifth Edition. New York: Augustus M. Kelley,[1878], 2001
Jevons, W. S. ,The State in Relation to Labour. London: MacMillan, [1882, 1910], 1968
Jevons, W.S., Methods of Social Reform. New York: Augustus M. Kelley,[1883],1965
Jevons, W.S., Investigations in Currency and Finance. London: MacMillan, [1884],1909
Jevons, W.S., The Principles of Economics. New York: Augustus M. Kelley,[1905] 1965
Jevons, W.S., Collected Economic Writings. 9 Volumes. London: Palgrave/MacMillan, 2001
Jevons, W.S., The Coal Question. New York: Augustus M. Kelley, [1865, 1906] 1965
Jevons, W.S., "Brief Account of a General Mathematical Theory of Political Economy." in The Theory of Political Economy. New York: Augustus M. Kelley,[1866],1965, pp. 303-14.
Jevons, W.S., "The Substitution of Similars." in [1890],1991, in: Pure Logic and Other Minor Works. Bristol: Thoemmes, [1869].
Jevons, W.S., Money and the Mechanism of Exchange. London: Kegan Paul, Trench, Trübner & Co. 1875
Keynes J.M. The Collected Writings of John Maynard Keynes, Volumes I to XXX, London: Macmillan, 1971-89
Maas, H., William Stanley Jevons and the Making of Modern Economics. (Historical Perspectives on Modern Economics.) New York, Cambridge University Press, 2005.
Proceedings of the Royal Society of London, volume 35, 1883, i-xii

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