On the Foundations of Environmental Policy
Chapter 6: Joint Production in the History of Economic Thought
Introduction 6.1 The analysis of joint production has long played an important role in the development of economic theory. Masterminds of economics – such as Adam Smith, John Stuart Mill, Karl Marx, Johann Heinrich von Th¨ nen, William Stanley Jevons, Alfred Marshall, Irving Fisher, Francis u Ysidro Edgeworth, Arthur Cecil Pigou, Heinrich von Stackelberg, John von Neumann, Piero Sraﬀa, and many more – devoted a considerable amount of eﬀort to the analysis of joint production. As a result, there exists an extensive and well-understood body of knowledge about joint production in economics. In this chapter, we outline how joint production has been analysed in the history of economic thought, starting from 1776 – the year in which Adam Smith’s Wealth of Nations appeared, marking the beginning of modern economics – up until the 1970s, when the present general equilibrium theory of externalities as well as the present theory of multioutput ﬁrms and industries had taken shape.1 This discussion serves several purposes, namely • to highlight the various economic dimensions and implications of both the phenomenon and the concept of joint production; • to outline the sources to which one might turn in order to use the extensive and powerful toolbox of economics for an analysis of joint production; • to show how the analysis of joint production has shaped the analysis of general economics, and how this has led to our present understanding of both general economics and joint production in particular; ∗ This chapter is based on Baumg¨rtner (2000: Chapters 5–7). a 107...
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