Marginalism and Marxism: The first encounter

Abstract

The paper discusses a critical episode in the history of economic thought of the 19th century — the first encounter between marginalism and Marxism. It happened in 1884, when Philip Wickstead published a short twenty-page text in the magazine of “scientific” socialism “To-Day” under the laconic title “Das Kapital: a Сriticism”. The paper briefly traces the creative path of Wickstead; considers the reasons that prompted him to make a stand against Marxism; analyzes his main criticisms; describes the reaction to them by his contemporaries (both professional economists and adherents of socialism) and evaluates the place of his work in the history of ideas. It is noted that Wicksteed’s article was not only the first encounter of marginalism with Marxism, but also the first popular exposituion of the theory of marginal utility (in the version of S. Jevons), which was completely new for that time. His criticism was radical in nature, since it was aimed not at revealing partial shortcomings, but at the complete collapse of the Marxist construction and its replacement with an alternative theoretical scheme. Amazingly, none of Marx’s supporters dared to accept Wickstead’s challenge and his criticism was never publicly contested by them. This seemingly inconspicuous event turned out to be of crucial historical significance. Under the influence of Wickstead, the Fabians rejected the labor theory of value and British socialism (in its main part) ceased to be Marxist forever.