Teaching in the Newly Established Political Economy Departments of American Universities

The GHSE not only inspired the establishment of institutions of higher edu­cation in the US, it also influenced the content and methodology of teaching and practicing political economy across the country.

158 The Early Establishment of Political Economy Departments many of the features that characterized an education in political economy under the leadership of the GHSE, including similar courses, language re­quirements, seminary methods, and adequate library resources, all of which would contribute to the advancement of knowledge and academic research.

Courses and Language Requirements at Newly

Established Economics Departments

German-trained American political economists were particularly impressed with the freedom and ‘all possible assistance’ that was ‘given to those who aim to do original work’ in Germany, despite the fact that the universities were state institutions (James 1882, 262). They highly valued the freedom that prevailed at the political economy departments of German universities, where students had ‘the greatest choice in the selection’ of their studies (Far­nam 1887, 67).

In supporting academic freedom, disciples of the New School believed that it was important to offer students a variety of courses to choose from, so that they could select the ones that would best serve their needs depending on their plans for the future. Like theorists of the GHSE, Walker (1889) ad­vocated for a multidisciplinary education to be offered in the political econ­omy departments of American universities. Mayo-Smith (1899, 2) agreed, as he maintained that ‘almost all social phenomena have an economic inter­est.’ Additionally, James was of the view that providing a greater diversity in the courses being offered would allow for a higher degree of specialization, which would entice more students to obtain a university degree in political economy. In turn, he believed that having more highly specialized univer­sity graduates would stimulate advances and progress in American society as a whole. Meanwhile, Patten (1895, 120) described history and sociology as ‘cousins’ of economics, while geography and physics were its ‘half-brothers.’ He supported the notion of having students train in these different disci­plines as early as high school in order to facilitate the ‘conscious study of the development of economic ideas’ (ibid.).

The Early Establishment of Political Economy Departments 159 philosophy, anthropology, religion, and ethics (Ely 1889). Additionally, disci­ples of the New School wanted to teach specialized political economy courses similar to those offered at German universities, which included a ‘series of lectures on the following subjects: History of Political Economy, Theoret­ical Political Economy, Practical Political Economy (the discussion of the economic problems of modern society), Science of Finance, Statistics, Police Supervision,’ Economic Institutions, and Administration (James 1882, 261). Adherents of the New School, ‘whether their writings tend to be deductive or inductive,’ also taught their students to use the ‘look and see’ method that was favored by the GHSE (Ely 1936, 149). They also unanimously supported the idea of relativity, which was an important feature of the GHSE when it came to explaining different economic policies over time.

Before German influence became widespread, little economic history was taught in the US. However, adherents of the New School expected their students to demonstrate a profound knowledge of the history of political economy. As such, they adopted some of the courses that were being of­fered in Germany on the history of economics and economic thought at their own institutions. This provided American students at newly established political economy departments with the opportunity to study subjects like Ancient and mediaeval commerce, crusades and the renaissance, and colo­nial policy, among others. For instance, Seligman focused on teaching the history of economics and finance at Columbia University. In those courses, he taught the works and ideas of a wide range of theorists and thinkers, in­cluding Plato, Aristotle, Xenophon, Cato, Seneca, Cicero, Aquinas, Petty, Locke, Quesnay, Gournay, Turgot, Mirabeau, Smith, Tucker, Hume, Can- tillon, Stewart, Malthus, Ricardo, Jones, Mill, Say, Sismondi, Cournot, Bas- tiat, Herrmann, List, Roscher, Knies, Hildebrandt, Rogers, Jevons, Leslie, Toynbee, Marshall, Wagner, Schmoller, Held, Brentano, Cohn, Schaffle, Menger, Bohm-Bawerk, Wieser, Walras, George, Walker, Clark, Patten, and Adams (Columbia University 1905—1907, 27).

Even though many of the original contributors to the development of po­litical economy at the University of Chicago were not really adherents of the New School, courses on history of economics were still being offered in the early years of the department. Some of these courses included the Origin and Development of the Historical School and the History of Political Econ­omy in Germany, the History of the Development of Economic Thought, the History of Socialistic Theories, and Recent German Systematic Writ­ers such as Wagner, Cohn, Schmoller, Schaffle, and Menger (University of Chicago Press 1892). Of note, the course on the Origin and Development of the Historical School and History of Political Economy in Germany fo­cused on studying the character of political economy and its relationships

with ethics, political science, and sociology. It involved having students study the methodologies of Mill, Menger, Wagner, and Schmoller, among others, with ‘special attention being devoted to Knies, Die Politische Oekonomie vom Geschichtlichen Standpunkte’ (ibid.: 10). Meanwhile, the course on German Economic Thinking concentrated on ‘the earlier writers, Rau, von Thu- nen, and Hermann’ (ibid.). Students taking this course had to work closely with Wagner’s Volkswirthschaftslehre, Schmoller’s Ueber einige Grundfragen des Rechts und der Volkswirthschaft, Schaffle’s Bau und Leben des socialen Korpers, and Menger’s Grundsatze der Volkswirthschaftslehre. Furthermore, the course on Recent German Systematic Writers aimed to help students ‘appreciate the spirit, quality, and tendency of German economic thinking’ and broaden their ‘view of fundamental economic ideas’ (ibid.: 12).

Between 1892 and 1901, Ashley taught classes on the History of Eco­nomics at Harvard University, which always had a large number of students enrolled in them. These courses covered a wide range of topics, including:

the economic theories of Plato and Aristotle; the economic ideas un­derlying Roman law; the mediaeval church and the canonist doctrine; mercantilism in its diverse forms; “political arithmetic;” the origin of the belief in natural rights and its influence on economic thought; the physi- ocratic doctrine; the work and influence of Adam Smith; the doctrine of population as presented by Malthus; Say and the French school; and the beginnings of academic instruction in economics.

(Harvard University 1897-98, 33)

Ashley also gave lectures on the Middle Ages to Mediaeval Economic History of Europe, conducted seminaries on Roscher, and taught selected works of Wagner and Schmoller (ibid.: 31, 34). Additionally, Laughlin (1885, 9-11) taught classes at Harvard University that required students to study some of the prominent books written by political economists since the 18th century, including Mill, Roscher, Smith, and Ricardo.

In its early years, the University of Stanford offered many courses cov­ering different periods of the history of economics. To be more precise, some of those courses included ‘A History of Tariff Legislation in the United States,’ ‘A History of Agriculture and Prices,’ ‘History of Economic Theo­ries,’ ‘A History of Industry, including Trades Unions, Guilds, Factory Sys­tems, Strikes, Arbitration, Labor Organizations, etc.’ (Leland Stanford Junior University 1894, 59).

Up until the early decades of the 20th century, the newly established economics departments at Johns Hopkins, Wisconsin, Harvard, Columbia, and other prominent universities offered courses on socialism, communism, the socialist movement in Europe, the history of modern socialism, and the labor movement in Europe. For example, the Communism and Socialism courses offered at Harvard University during 1892-1893 focused on French and German socialism, as well as Ely’s views on socialism.

The Early Establishment of Political Economy Departments 161 University, Clark taught a course that criticized scientific socialism, which was comparable to Wagner’s class on the critique of socialism being offered in Berlin (Columbia University Bulletin 1897, 68). Clark also taught ‘Com­munistic and Socialistic Theories,’ where students studied ‘the works of St. Simon, Fourier, Proudhon, Owen, and Lassalle’ as well as ‘Marx’s treatise on capital’ (Columbia University 1905—1907, 35). In this course, students also had to be familiar with ancient labor movements, mediaeval and early mod­ern labor movements, economic causes of the French Revolution, the life and teachings of Saint-Simon, France’s social and economic situation under Louis XVIII and Charles X, etc.

Newly established political economy departments in the US also offered classes on the social and economic problems of the time. For instance, Devine taught a course called Poverty and Dependence in the Social Economy at Columbia University, which focused on improving the social and economic conditions of the masses. Basically, this class emphasized the importance of ‘Charity organization; social settlements; housing reform; the elimination of disease; the restriction of child labor; and the prevention of overcrowding, and especially the congestion of population in the tenement-house districts of the great cities’ (Columbia University 1905—1907, 32).

The criteria for obtaining a PhD at the newly established economics depart­ments in the US were comparable to those required by German universities. Up until the first few decades of the 20th century, the general examination for a PhD at American universities typically required students to demonstrate a robust understanding of the works of Ancient Greek philosophers and the theories, policies, and methods of the GHSE. They also had to master the following subjects: Economic Theory, Economic History, Public Finance, International Trade and Tariff Policy, History of Political Theory, Money, Banking, Crises, the Economics of Corporations, the Economic History of the 19th century, and the History of Modern Socialism.

Proficiency in foreign languages also became a criterion for obtaining a PhD in political economy at American universities. This is because German-trained Americans were very impressed by the fact that political economy students in Germany were required to have some knowledge of Latin and ‘modern lan­guages as a prerequisite to the degree of Ph.D.’ (James 1888, 614). At the uni­versities of Berlin, Bonn, Gottingen, and Konigsberg, it was prescribed that ‘if the thesis relates to topics connected with classical and Oriental philology and antiquities or ancient history and philosophy it must be written in Latin’ (ibid.: 615). For all other topics, the faculty could ‘accept a thesis in German,’ but the candidate may still ‘be required at the public examination to show that he can read and translate a passage assigned him from some Roman classic’ (ibid.). When foreign students underwent examinations in German universi­ties, in addition to proving their ability to study in German, it was also possible for them to be made to demonstrate a capability to translate from Greek or Latin as a condition for obtaining their degrees (ibid.: 614). In fact, improving their proficiency in the German language was one of the main reasons why

many foreign students and academics of political economy went to Germany during the dominance of the GHSE. They wanted to be able to comprehend many of the important books, articles, and papers that were being published in German. Since German was the language of the international scientific community, prominent academics of the time often published their research in German in order to gain international recognition. German was also usually the main language used at international conferences and congresses along with French and English to some extent (Ruggles 1863).

Laughlin (1912, 172) was critical of the fact that only a few of the students that obtained undergrad degrees from the political economy departments of American universities possessed the ability to read in French and Ger­man. Meanwhile, Ely (1889, 69) argued that in order to have ‘the advanced investigation, a knowledge of foreign languages, especially of German, is indispensable’ at American institutions of higher learning. Given the im­portance of the German language in the international scientific community, German-trained American political economists believed that American uni­versities should be staffed with professors and teachers that were fluent or pro­ficient in German, as well as French. They also wanted American economics students to possess a working knowledge of German, because they were expected to read and comprehend the original works of German political economists. Since many of the books written by theorists of the GHSE were not translated into English, Ely (1889) advised economic students to learn German so that they could read and comprehend important texts like Ro­scher’s System der Volkswirthschaft, Wagner’s Lehrbuch der politischen Oekonomie, Knies’s Die politische Oekonomie vom geschichtlichen Standbuhkte and Geld und Credit, Schmoller’s Ueber einige Grundfragen des Rechts und der Volkswirthschaft, and Schonberg’s Handbuch derpolitischen Oekonomie. Eventually, efforts on the part of the disciples of the New School led to German becoming the ‘second language’ that was ‘required by all major American institutions granting the Ph.D. in economics,’ at least until the outbreak of WWII (Senn 1989, 263). During that period, it was common practice for students to be asked to trans­late, interpret, or explain quotations attributed to German economists of the 19th century that were written entirely in German.

Following the decay of the GHSE, learning German was no longer neces­sary in the discipline of economics in the US. This turned out to be a signif­icant problem when it came to spreading the work and ideas of the GHSE, because the books and articles written by its theorists were rarely translated into English with a few exceptions, because German was the language of the academic world for most of the 19th century. In fact, in the early decades of the 20th century, ‘only three articles, a booklet on mercantilism,’ and ‘a condensed’ version of Schmoller’s Grundriss were ‘translated into English’ (Peukert 2001, 71). With the decline of the GHSE, the German language all but disappeared from the curricula of American universities and colleges as a requirement for obtaining a PhD. Since 1920, the ‘only new language that American economists’ had to learn aside from English was mathematics (Bal­abkins 1988, 111). This ‘deplorable linguistic deficiency among American

The Early Establishment of Political Economy Departments 163 economists today deprives them of the ability to learn from other economists’ who published in different languages (ibid.: 107).

The Rise of Statistics in Political Economy

It is often accepted that Johann Heinrich Gottlob Justi (1717—1771), who was the most important contributor to cameralism and ‘the first theoretician of the administrative census’ in Germany, played a pioneering role in the application of statistics to economics (Chaloupek 2009, 151). However, the word statistics was first coined by ‘Gottfried Achenwal, professor oflaw and politics at Gottingen, in his work entitled “Staatsverfassung der heutigen vornehmsten Europaischen Reiche und Volker,” ofwhich the first edition bears date 12th April, 1749’ (Guy 1865, 478). He specifically used the term to identify those disciplines that focused on ‘the extent, limits, subdivisions, and natural relations of States, their advantages, their history, and their origin’ (Guy 1865, 479). In the 19th century, the main contributions to advances in statistics in Germany occurred at statistical bureaus. In 1805, the Statistical Bureau of Prussia (Prussian Statistical Bureau) (Preuβischen Koniglichen Statistischen Buros, 1805—1934) was opened in Berlin. Then, in 1862, the statistical office of Berlin was established (Statistisches Bureau der Stadt Berlin)? Two years later, in 1864, Bruno Hildebrand founded the Thuringian Statistical Office in Jena. Subsequently, the statistical bureau ofthe German Empire (Kaiserliches Statis­tisches Amt) was created in 1872. Additionally, the State Sciences Society (Staat- swissenschaftliche Gesellschaft) was founded by Schmoller, who ‘collected archival materials and wrote statistical and economic monographs for almost twenty- five years of his academic career, from 1864 to 1887’ (Balabkins 1988, 54). In 1888, a government-funded statistical organization called The Archiv fur soziale Gesetzgebung und Statistik was established by Ernst Engel (1821—1896), ‘one of the most famous economists of Europe,’ who acquired much notoriety for creating the Engel Curve (Engel’s Law) (Dorfman 1955, 18). These various statistical bureaus were closely connected with each other and often exchanged views and ideas. They also organized seminars to provide students with training in statis­tics, while their members travelled internationally in order to acquire further training and advance their knowledge.

German statistical bureaus ended up publishing a large ‘amount of original work’ (Adams 1884, 80). These publications were of ‘international signifi­cance, by reasons of the lessons which they teach’ (ibid.). Anyone interested in a comparative analysis of:

the subject of national or municipal finance; the relations of church and school; sanitation; insurance; trade and commerce; industries; popula­tion; land and climate; cities; development of the science of statistics; statistical congresses; markets; fairs; genealogies of royal families; tables of mortality; education; administration, etc.

was ‘richly rewarded by consulting the published works’ of statistical bureaus.

(ibid.)

Engel was widely regarded as ‘the greatest of living statisticians’ and the intellectual father of statistical empiricism at the GHSE (Ely 1883, 233). From 1860 to 1882, he served as director of the Statistical Bureau of Prussia, which was recognized as the central authority on statistics in the Prussian territories (Meitzen 1889, 57). Under his direction, the Statistical Bureau of Prussia organized seminars focusing on original research. In his own seminary, Engel was clearly committed to the statistical training of ‘university graduates who qualified for admission to the higher branches of the civil service’ (Dorfman 1955, 18). Basically, ‘the government offices of the statistical bureau’ became ‘laboratories of political science’ (Adams 1884, 80). Like many adherents of the GHSE, Engel also played an im­portant role in the development of empirical investigation into social and economic problems for the purpose of designing effective policies and reforms.

Among theorists of the GHSE, Knies was ‘one of the earliest advocates of the development of statistics,’ and many American political economists were highly influenced by his views and teachings (Ely 1936, 145). Mean­while, Wagner, who applied ‘the statistical method to banking problems,’ argued that ‘statistics were to be applied’ to all social and natural phe­nomena so as to determine causal relationships (Haney 1915, 482, Herbst 1965, 138). According to him, large-scale data could be used to explain different aspects of economic variables or economic phenomena, which could help gain an understanding of the development of institutions of society.

German students had the advantage of studying at universities and training at statistical bureaus where they could hone the skills needed for ‘this profession; in which the civil service’ gave ‘place and rank, and recognition and promotion’ to those who excelled as statisticians (Walker 1899, 141). Meanwhile, many of the Americans studying in Germany benefited from taking statistical seminars conducted by Engel, Conrad, Knies, Schmoller, and Wagner (James 1882, 262). These American stu­dents ended up supporting the use statistics in order to maintain scientific accuracy. Moreover, they came to regard statistics as a tool for observing regularities and irregularities and discovering causal relationships, which could be helpful in designing social and economic reforms and policies (Mayo-Smith 1899). In fact, Mayo-Smith (1888, 386) stated that statis­tics was ‘a valuable auxiliary in the work of depicting the evolution of economic institutions, or of describing the present economic condition of the world.’ He also pointed out that in ‘inductive science, the impor­tance of the statistical method becomes still greater’ (ibid. 387). Mayo- Smith further argued that, ‘with the extension of statistical inquiry and the refinements in statistical method, statistics promise to be of constantly increasing value’ (ibid.).

Ely, who was a member of the statistical bureau of Prussia and attended the statistics lectures of Engel and Wagner at Berlin University, advocated for

The Early Establishment of Political Economy Departments 165 statistics to be taught at the newly established political economy departments of American universities. This position was strongly supported by a number of members of the New School, including Dewey (1889, 364) who argued that by studying statistics, ‘the student will undoubtedly gain a far more last­ing knowledge of the subject matter.’ In fact, he went so far as to suggest that ‘the study of Statistics should be made the very backbone’ of economic education (ibid.: 365). Similarly, Farnam (1913, 32) was highly supportive of the use of statistics, stating that the ideal of economists must be ‘to express in numerical form.’ Meanwhile, Patten (1891, 100) insisted that since political economy was an inductive and historical science, it needed to focus on statis­tics to the fullest extent possible instead of mathematical economics.

Even though adherents of the New School accepted statistics as a highly useful tool for political economy, the vast majority of American economists neglected its role before this school of thought attained its dominant position in the discipline of economics (Walker 1899, 290). In fact, prior to the influ­ence of the GHSE, Americans never did ‘anything as a nation, and little in their individual capacity, to promote the cultivation of statistics’ (ibid.: 149). In the 1860s, the Congress of the US had not yet ‘established a distinct Bu­reau of Statistics,’ even though statistics were ‘the very eyes of the statesman, enabling him to survey and scan with clear but comprehensive vision, the whole structure and economy of the body politic’ (Ruggles 1863, 8). At that time, it was almost impossible to fathom that in the future, ‘America may at least approach in scientific accuracy and philosophical arrangement, the more mature and perfect performances of the statisticians of Europe’ (ibid.: 14).

Walker played a major role in the development and use of statistics in the US, particularly ‘the extension and improvement of the statistical service’ of the American government (Falkner 1897, 3). In fact, he was credited with teaching one of America’s first courses in statistics at the Yale Graduate School (Adelstein 1993, 301). He also published the Statistical Atlas in 1870, which earned him the respect of many statisticians and scholars of his time. Furthermore, he worked for the American census, where his goal was ‘not only to improve the quality of the census, but to make it a complete record of the social and economic condition of the people’ (Falkner 1897, 3). Walker believed that statistics was ‘a method’ that historians, sociologists, and political economists could use to ‘con­fidently and surely to reduce from thousands of pages closely packed with figures some hitherto unsuspected law of human life or conduct’ (Herbst 1965, 140).

Walker (1899, 150) pointed out that unlike in Germany where working in statistical offices usually required a PhD, the US did not employ trained statisticians, and ‘the work was in the hands of those who necessarily were ig­norant of the elementary principles attending the collection and compilation of statistics and the administration of statistical service.’ He further explained that the absence of formal training in statics meant that Americans lacked ‘elementary knowledge of the subject which was necessary to save them from making great errors of judgment, and sometimes monstrous errors in their conclusions’ (ibid.). He pointed out that while the American government 166 The Early Establishment of Political Economy Departments spent ‘tens of millions upon the collection, compilation, and publication of statistics,’ it never invested significantly ‘in training and preparing the men who should conduct the statistical service of the country’ (ibid.: 149). Walker (1899, 150) stressed that it was illogical for the American government to spend ‘enormous sums’ for statistics, as well as ‘statistical service in other departments of the government,’ while at the same time doing nothing to facilitate the formation of proficient statisticians. This lack of training was responsible for Americans suffering ‘an enormous loss of resources’ and ‘great impairment of the validity, accuracy, and comparability’ of their statistics at the national, state, and municipal levels relative to European countries (ibid.: 150—151). Walker (1899, 151) also underscored that American ‘colleges and universities’ did not contribute to rectifying this situation by training statisticians. Mayo-Smith (1888, 413) concurred, claiming that one ‘cannot have scientific statistical results unless’ one employs ‘scientifically trained statisticians.’

During their education and training in Germany, American students were very impressed with the statistical techniques that were developed by the Ger­mans. In fact, the influence of the GHSE was a key factor that led American scholars to start paying serious attention to the field of statistics, which had been largely neglected in the US up to that point. In the 1880s, German-trained Americans pushed for statistics to be taught at all colleges and universities, because they believed that it was a very useful tool that would enable political economists to formulate ‘correct economic policy’ and reforms (Mayo-Smith 1888, 385). After returning home from Germany in 1879, ‘Henry Carter Ad­ams became the first statistician of the Interstate Commerce Commission and devised its pivotal accounting system which served as a model for the regu­lation of public utilities here and throughout the world’ (Dorfman 1955, 23). The following year, in 1880, Columbia University offered the first course on statistics at an American university, which was conducted by Mayo-Smith, who continued to teach the subject until his death in 1901. During that time, his statistics courses were very well received by students at Columbia. Fur­thermore, his books in statistics, including Science of Statistics (1895), Statistics and Sociology (1895), and Statistics and Economics (1899), were very influential on the development and application of statistics in the social sciences at Ameri­can universities.⁸ Additionally, the introduction of Ripley’s course on statistics at Harvard University in the 1880s attracted a great deal of interest, which was very promising ‘for the future of economic studies in Harvard’ (Carver 1902, 248). Then, in 1891, Falkner was appointed as an associate professor of statis­tics ‘at the Wharton School of the University of Pennsylvania,’ which meant he was ‘the first man to hold a leading American university post devoted ex­clusively to statistics’ (Dorfman 1955, 23).

In addition to the newly established political economy departments at many American universities, the American Statistical Association (ASA) also played a major role in introducing statistical studies at colleges and uni­versities across the country (Walker 1899, 301). This organization aimed to

The Early Establishment of Political Economy Departments 167 promote ‘the discussion of statistical methods, statistical results, and statistical principles among the members’ (Walker 1899, 152, 154). It also prepared students for employment in the provision of statistical services by the govern­ment. Despite its crucial role, the ASA never had ‘any funds. Now and then the treasurer sent bills to members for their small fees toward the expenses of a hall or of a meeting’ (ibid.:152).

Eventually, Americans became devoted to statistical research and inves­tigation to an ‘exceptionally high degree,’ with national and state statistical bureaus ‘opening in every direction’ (Walker 1899, 145). By the end of the 19th century, there was no country where ‘the work of the statistician’ was ‘held in greater honor’ and respect than in the US (ibid.: 141). In early 20th century, ‘the forecasting service’ became highly influential in the US and:

its methods and techniques were copied and admired by the London and Cambridge Economic Service, the Institute of Statistics at the University of Paris, the Institut fur Konjunkturforschung in Berlin, and in similar organ­izations in Rome, Vienna, Padua, and elsewhere.

(Mason and Lamont 1982, 414)

Although the empirical and statistical methods of the GHSE became im­portant parts of mainstream economics in the 20th and 21st centuries, the original contributions of this school of thought to the application of statistics within the discipline of economics have been largely forgotten.

The Establishment of PhD Programs based on the German Model

German-trained American political economists were highly involved in set­ting up graduate programs at some of the most prestigious universities across the US. After returning from Germany, they proceeded to engage in a debate to determine the precise criteria that should be met in order to be awarded a PhD in their discipline. It was believed that this debate would benefit signif­icantly from examining ‘the condition of things in Germany,’ given that ‘the degree of Doctor of Philosophy is pre-eminently a German degree’ (James 1888, 611). At German universities, a PhD was the highest academic degree that could be attained. Acquiring one required an advanced education, sci­entific training, creativity, and the writing and defense of an original the­sis. Furthermore, having a PhD was not only a ‘requirement for university teaching’ in Germany, it was also ‘important for entry into some parts of state administration’ (Tribe 2002, 4). James (1888, 611) explained that prior to German inf luence, a PhD in the US was regarded to a large:

extent as an honorary degree, and given away so lavishly to men of high station and low station, and, indeed, of no station at all, that those who hold it on examination are almost ashamed of it, and finally, in order

to defend themselves, have adopted the expedient so long in vogue in England of writing after their degrees the name of the university from which it is taken.

Many of the economics graduate programs that were established at American institutions toward the end of the 19th century adopted the German model. At that time, earning a PhD at a typical American institution required stu­dents to take courses for three years, write and defend a thesis, pass an oral exam, and master a foreign language (e.g., French, German, or Latin). In the US, the first PhD in political economy was awarded at Harvard in 1875, while ‘Yale awarded the second in 1877’ and ‘Johns Hopkins awarded the third’ in 1878 (Parrish 1967, 7). Subsequently, a total of ‘five institutions awarded’ 11 PhD degrees in political economy in the 1880s, while another ‘twelve institutions awarded 95 degrees’ in the 1890s (ibid.: 11). These early PhD degrees were experimental, in a sense. In hindsight, it appears that they may have been premature, as evidenced by the fact that:

after awarding its first Ph.D. in political economy in 1875, Harvard did not award another for 20 years. After its first degree, Yale did not award another for seven years. The Johns Hopkins did not award a second po­litical economy Ph.D. until after a lapse of ten years.

(ibid.: 7-8)

Nevertheless, the establishment of a PhD degree played an important role in fortifying and justifying ‘the new professorships in political economy’ in the US (ibid.: 8).

In 1897, a comparison of political economy programs at German and Amer­ican universities revealed that the requirements for acquiring a PhD were most stringent at the University of Berlin relative to all other universities in both countries (Columbia University Bulletin 1897, 67). At the same time, ‘the requirements for the degree of PhD’ were found to be ‘higher in several American institutions than in the average German university’ (ibid.). In fact, it was argued that ‘the progress of American universities’ was so rapid at the end of the 19th century while the entrance requirements had ‘so largely increased, that the bachelor’s degree’ was ‘actually approaching the German doctorate in essential worth’ (ibid.). The possibility of obtaining a quality PhD at an American institution of higher learning actually slowed the number of stu­dents leaving the country to study political economy in Germany. However, it was really the beginning of WWI that completely dissuaded American eco­nomics students from traveling to Germany in search of a higher education.

The Introduction of the German Seminary Method at American Political Economy Departments

Before coming under German influence, education at American universities was based on ‘the old-fashioned system of daily examinations, in which the

The Early Establishment of Political Economy Departments 169 students’ were ‘interrogated like witnesses,’ and their learning experience was very ‘mechanical’ (Farnam 1887, 71). Unfortunately, this kind of educa­tion system was damaging to ‘the interest of the student, no less than to kill originality and suggestiveness on the part of the teacher’ (ibid.). Accordingly, German-trained Americans were very impressed with the seminaries (Semi- narium) they experienced in Germany, which were a major part of the system of higher education in that country that were credited with motivating crea­tive and original scientific research (Adams 1884, 64).

Initially, ‘the seminary was a nursery of theology and a training-school for seminary priests’ (ibid.). The original mediaeval seminaries were supposed to ‘impart to the students a comprehensive knowledge of particular topics’ and ‘teach them methods of special work’ (Seligman 1912, 153). As it turns out, the German seminaries of the 19 th century were ‘only modifications’ of their mediaeval predecessors (Adams 1889, 142). In other words, the seminaries at German universities were outcomes of ‘the development of the old scholastic method of advancing philosophical inquiry by the defense of original theses’ (Adams 1884, 64). The first seminary in Germany was founded at ‘Goettin­gen in 1733, by Gesner the famous Latinist,’ and it served as ‘the model for all later ones’ (ibid.). In the 1830s, German historian Leopold von Ranke (1795—1886) and a number of other scholars played key roles in spreading the concept of historical seminary training through ‘all the universities in Germany’ (ibid.: 65).

Seminaries became one of the most important aspects of the scientific ac­tivity that professors and students of the GHSE engaged in (St. Marc 1892, 101). To be accepted into a German seminary, students had to be earnest about their studies, as ‘idlers or dilettantes’ were not admitted (Illinois School Journal. March 1882, 14). Since seminaries were ‘gratuitous and private, the professors’ had ‘the right to refuse admittance to any they choose’ (ibid.). Students were also ‘subject to expulsion by the board of control for failure to discharge any obligations, for inadequate work, or for misuse of the library’ (Adams 1884, 69).

In practice, seminaries were essentially supplements to lectures, where ex­perienced masters would teach their ‘young apprentices the deft use of the tools of the trade’ (Adams 1884, 70). The real purpose of the seminar was to ‘teach the student how to handle his material and by interpretation or dis­covery to make a contribution to the store of existing knowledge’ (Seligman 1912, 157). It also encouraged the free expression of ideas, creativity, criti­cal thinking, and the spirit of scientific independence. Basically, seminaries stimulated the appetites of students when it came to performing original work and developing their skills in academic research (ibid.). Seminaries also allowed professors to advance their specializations, while also giving them more time to devote to their own research and writing. Typically, there were two types of work that prevailed in the German seminary for political econ­omy: ‘the writing of short theses (Kleine Arbeiten) or the critical reading of some document or documents, more frequently of some chronicler or chron­iclers’ (Adams 1884, 71). Each seminar also generally allocated a half-hour ‘to

the review of current periodical and other scientific publications’ (Seligman 1912, 157). This was done to ensure that students experienced ‘increased fa­miliarity with the recent literature’ (Seligman 1892, 4). The rest of the time was dedicated to investigations conducted by participants, who had to present the results of their research and ‘get the benefit of criticism and discussion’ (Taussig 1912, 165).

Based on his experiences at the University of Heidelberg, Herbert Baxter Adams (1884, 68) claimed that the seminary method employed by Knies mainly consisted of ‘reading and discussion of original papers by his pupils upon assigned topics.’ In the seminary, ‘the professor selects a list of subjects for theses from the field of his special line of investigation and assigns them to the students, the latter’s particular tastes being generally consulted’ (ibid.: 71). Then, ‘the professor points out the sources and authorities, and the stu­dent consults with him whenever difficulties arise in the preparation of the work’ (ibid.). Furthermore, Adams (1884, 79) commented on the importance of the statistical seminary in Berlin, which trained ‘university graduates who have passed the examinations required for entrance to the higher branches of the civil service.’ German statistical seminaries also included participants who were already ‘doctors of philosophy’ and ‘public officials’ (Seager 1893, 246). Adams (1884, 69) was also impressed by the quality of seminaries at Bonn, where ‘all members are expected to be present, although no indi­vidual student makes more than one contribution during a semester.’ There was undoubtedly ‘a unification of their work,’ which provided a benefit for the instructors and participants alike (Taussig 1912, 163). When it came to seminaries, Taussig (ibid.: 169) supported oral presentations, but was strongly opposed to ‘the reading of papers,’ arguing that to ‘read from manuscript at the meetings’ was ‘deadly’ and ‘appalling.’ Taussig (ibid.) went so far as to contend that if students are unable to present their research without reading, they should not ‘be allowed to persist in preparation for the teaching profes­sion, or even in a career of research.’

German-trained American political economists highly valued ‘a social side to a German Seminar’ (Seager 1893, 248). They enjoyed the fact that ‘profes­sor and students’ met ‘upon a footing of intimacy, the formality of the lecture room’ was ‘put to one side’ (ibid.). In the seminar, the professor was ‘not the preceptor but the coworker’; he was like ‘the friend’ and ‘the equal’ of his stu­dents (Seligman 1912, 159). On occasions where the professor did criticize his students, he guided the discussions, and it was often the case that he learned from them (ibid.). For American students, it was ‘this feeling of equality, of meeting on a common fighting-ground’ that constituted ‘one of the most precious features of the seminar’ (ibid). Seligman (1912, 159) confessed that bringing the professor ‘into personal and friendly contact with the students’ was ‘an utter impossibility in the lecture-room’ of the American university.

Unlike regular courses, where ‘the university students enter the lecture­room as strangers, and depart as strangers,’ seminaries gave participants ‘an opportunity of gauging each other’s abilities, of familiarizing each with the

The Early Establishment of Political Economy Departments 171 others’ strong points, of laying the seeds of future collaboration in scien­tific or professional work’ (ibid.: 156, 157). Herbert Baxter Adams (1884, 68) pointed out that in addition to getting scholarly training and engaging in stimulating debates, students also had a ‘pleasant’ and ‘enjoyable’ time in a friendly environment, where long-lasting friendships were made. After the seminary had concluded, the professor would sometimes invite the partici­pants to a restaurant or their home, which allowed for the continuation of discussions in a more relaxed setting (St. Marc 1892, 102). In fact, it was these ‘friendly after-gatherings that the most pleasant recollections of many of those’ who studied in Germany (Seager 1893, 248).

Many prominent adherents of the New School were trained in the semi­nars of the GHSE, including Ely, H. C. Adams, H. B. Adams, Patten, James, Seligman, Falkner, Johnson, Seager, and Fetter. After participating in sem­inaries held in places like Berlin, Bonn, Heidelberg, and Leipzig, they were motivated to implement the German seminary method at American univer­sities. Actually, they believed that university instruction was not complete without seminaries. Thus, when they were developing graduate programs for American universities, they agreed that the German seminary method needed to be adopted. Seligman (1912, 160) was of the view that the seminar was an ‘adjunct to specialization,’ meaning that it should be ‘the work of the university, not of the college.’ He believed that college students did not have ‘the maturity nor the training’ that were ‘necessary prerequisites to inde­pendent thinking,’ nor did they possess the ‘linguistic and literary equipment’ required for the successful utilization of ‘the arts of comparison and criticism’ (ibid.: 161). Accordingly, he emphasized that the seminar should be ‘a strictly university method’ (ibid.: 160). In fact, he wanted the seminar to be restricted to masters and PhD candidates only (Seligman 1911, 390).

In 1881, Herbert Baxter Adams was credited with being one of the first American scholars to introduce the German-type seminary in the US at Johns Hopkins University. He was followed by Taussig and Dunbar at Harvard and James at the University of Pennsylvania (Herbst 1965, 36). From there, the seminar method that was imported from Germany ended up spreading quite rapidly through American universities. Eventually, the ‘advanced courses’ in political economy that were being offered at American universities were ‘car­ried’ on like German seminaries (Laughlin 1912, 171). The seminaries ended up becoming revolutionary in the discipline of economics in the US, which motivated further specialization and advanced academic work. Eventually, German seminary training also spread throughout ‘institutions beyond Ger­man borders’ in many countries (Adams 1884, 65).

The Establishment of Adequate Libraries

German-trained Americans were captivated by the extensive library facil­ities that were available at the German universities and the great quantities of books and journals they possessed. First of all, they were surprised by the

number of different libraries that they had access to as students in Germany, including the library of the House of Parliament, the statistical library, the university library, and the university reading room (Seager 1893, 252). They were particularly impressed by the capacity of university libraries, which boasted ‘several thousand volumes’ and complete collections of periodicals that could be used by the students (ibid.: 251). These libraries also had ‘files of the leading German economic journals, a large assortment of government publications and an especially rich collection of works upon public finance’ (ibid.: 252). Each university also had seminary libraries for its various depart­ments. For example, political economy departments generally had ‘a very complete collection of economic works’ at the service of students and pro­fessors (ibid.). In fact, they contained almost ‘all the important works in Ger­man, English and French bearing upon general economics’ (ibid.). They also housed papers that were ‘pieces for scientific purposes’ (Adams 1889, 145). Moreover, the seminaries of political economy devoted ‘especial attention to the collection of statistical materials, documents illustrating local, municipal, state, and national institutions; also to the collection of maps, works of his­torical and political geography’ (ibid.: 146).

Statistical bureaus also had their own libraries. For example, the library of the Prussian Statistical Bureau was accepted as unrivaled, because it provided a ‘complete guide to political science in its historical, theoretical, and practical as­pects’ with ‘over 70,000 volumes’ (Adams 1884, 81). At the time, there existed:

far and wide no library so rich, no collection of periodicals so select, no map collection so excellent, as those in the royal bureau of statistics. All new contributions to this branch of literature, whether in Germany, France, England, Belgium, Holland, Sweden, Norway, Denmark, Rus­sia, Italy, Spain, Portugal, North and South America were made available to the members of [its seminary].

(ibid.)

The library of the Prussian Statistical Bureau also had ‘a series of more than seventy special magazines of political economy, statistics, and the allied branches of industry, agriculture, commerce and trade, public; works, fi­nance, credit, insurance, administration (municipal and national), social self help’ that it made available for ‘seminary-use’ (ibid.).

American students pointed out that these various library resources that were available in Germany were of great service to the students of political economy. They were also impressed with how long those libraries were open. For example, most libraries in the US were only open for about an hour per day, while many of those in Germany were open for study from seven in the morning until nine in the evening (Seager 1893). It was common for students to work at the libraries for at least a few hours on most days (Adams 1889, 145). German-trained American political economists were also surprised that books could be borrowed by university students and ‘retained four and, upon renewal, six weeks’ (Seager 1893, 251).

Walker (1899, 289) believed that libraries were very important for ‘ad­vanced historical study.’ Ely also (1889, 72) underlined the importance of libraries for both the teachers and students of political economy. That said, he recognized that relative to their German counterparts, American colleges and universities lacked adequate library facilities in terms of capacity and accessi­bility. This was evidenced by the fact that in 1840, Yale had ‘15,000 volumes, Harvard, 52,000, Columbia, 15,000,’ whereas the library in Gottingen had 200,000 volumes on its own (Parrish 1967, 4). Adherents of the New School were fully conscious that the development of political economy departments at American institutions required the establishment of adequate libraries sim­ilar to the ones in Germany. Over time, the efforts of German-trained Amer­ican scholars led to an expansion and enhancement of US library resources. By 1900, Harvard library had ‘500,000 volumes,’ Columbia had ‘250,000,’ and Cornell had 200,000 (ibid.: 9).