Author Petty William Sir

27 May 1623 to a family of middle income, his father being a Hampshire clothier, as was his grandfather. A precocious and intelligent youngster, he became a cabin boy in 1637, but was set ashore in Normandy after breaking his leg on board. After this setback, he applied in Latin to study with the Jesuits in Caen, supporting himself by teaching English. After a year, he returned to England and had by now a thorough knowledge of Latin, Greek, French, mathematics and astronomy. After an uneventful period in the Navy, he left to study in Holland in 1643, where he developed an interest in anatomy. Through an English professor in Amsterdam, he became the personal secretary to Hobbes allowing him contact with Descartes, Gassendi and Mersenne. In 1646, he returned to England and, after developing a double-writing instrument with little success in sales, he studied medicine at Oxford University. He befriended Hartlib and Boyle, and he became a member of the London Philosophical Society, and possibly met John Milton. By 1651, he had risen to Professor of Anatomy at Brasenose College, Oxford and was also Professor of Music in London. In 1652, he left on a leave of absence and travelled with Oliver Cromwell's army in Ireland, as physician-general. His opposition to conventional universities, being committed to ‘new science’ as inspired by Francis Bacon and imparted by his afore-mentioned acquaintances, perhaps pushed him from Oxford. He was pulled to Ireland perhaps by sense of ambition and desire for wealth and power. His breadth of interests was such that he successfully secured the contract for charting Ireland in 1654, so that those who had lent funds to Cromwell's army might be repaid in land - a means of ensuring the army was self-financing. This enormous task he completed in 1656 and became known as the Down Survey, later published (1685) as Hiberniae Delineatio. As his reward, he acquired approximately 30 000 acres (120 km²) in Kenmare, in southwest Ireland, and £9 000. This enormous personal advantage to Petty led to persistent court cases on charges of bribery and breach of trust until his death. None were ever proven. Now back in England, as a Cromwellian supporter, he ran unsuccessfully for Parliament in 1659 for West Looe. Despite his political allegiances, he was well-treated at the Restoration, although he lost some of his Irish lands. In 1662, he was invited to join the 'Invisible College', a club of intellectuals and was a charter member of the Royal Society of the same year. This year also saw him write his first work on economics, his Treatise of Taxes and Contributions. Petty counted among his many scientific interests naval architecture: he had become convinced of the superiority of double-hulled boats, although they were not always successful; the Experiment reached Porto on 1664, but sank on the way back. He was knighted in 1661 by Charles II and returned to Ireland in 1666, where he remained for most of the next twenty years. The events that took him from Oxford to Ireland marked a shift from medicine and the physical sciences to the social sciences, and Petty lost all his Oxford offices. The social sciences became the area that he studied for the rest of his life. His primary interest became Ireland’s prosperity and his works describe that country and propose many remedies for its then backward condition. He helped found the Dublin Society in 1682. Returning ultimately to London in 1685, he died in 1687. He regarded his life in bittersweet terms. He had risen from humble origins to mix with the intellectual elite and was by 35 a considerably wealthy man and leading member of the 'progressive sciences'. Nonetheless, he was insecure about his land holdings and his ambitions of obtaining important political posts remained frustrated. Perhaps he expected the astronomical rise he experienced in his early years to continue throughout his life. Contemporaries described him, nonetheless, as humorous, good-natured and rational. He is most well known for economic history and statistic writings, pre-Adam Smith. Of particular interest were Petty's forays into statistical analysis. Petty's work in political arithmetic, along with the work of John Graunt, laid the foundation for modern census techniques. Moreover, this work in statistical analysis, when further expanded by writers like Josiah Child, documented some of the first expositions of modern insurance. Vernon Louis Parrington notes him as an early expositor of the labor theory of value as discussed in Treatise of Taxes in 1692. [1] Before discussing Petty's economic theories, it is important to point out two crucial influences in his life. The first is Thomas Hobbes, for whom Petty acted as personal secretary. According to Hobbes, theory should set out the rational requirements for ‘civil peace and material plenty’. As Hobbes had centered on peace, Petty chose prosperity. Secondly, the influence of Francis Bacon was profound. Bacon, and indeed Hobbes, held the conviction that mathematics and the senses must be the basis of all rational sciences. This passion for accuracy led Petty to famously declare that his form of science would only use measurable phenomena and would seek quantitative precision, rather than rely on comparatives or superlatives, yielding a new subject that he named political arithmetic. Petty thus carved a niche for himself as the first dedicated economic scientist, amidst the merchant-pamphleteers, such as Thomas Mun or Josiah Child, and philosopher-scientists occasionally discussing economics, such as Locke. He was indeed writing before the true development of political economy. As such, many of his claims for precision are of imperfect quality. Nonetheless, Petty wrote three main works on economics, Treatise of Taxes and Contributions (written in 1662), Verbum Sapienti (1665) and Quantulumcunque concerning money (1682), all refreshingly concise. These works, which received great attention in the 1690s, show his theories on major areas of what would later become economics. What follows is an analysis of his most important theories, those on fiscal contributions, national wealth, the money supply and circulation velocity, value, the interest rate, international trade and government investment. Fiscal contributions were of prime concern to policymakers in the 17th century, as they have remained ever since, for the wise country would not spend above its revenues. By Petty’s time, England was engaged in war with Holland, and in the first three chapters of Treatise of Taxes and Contributions, Petty sought to establish principles of taxation and public expenditure, to which the monarch could adhere, when deciding how to raise money for the war. Petty lists six kinds of public charge, namely defence, governance, the pastorage of men’s souls, education, the maintenance of impotents of all sorts and infrastructure, or things of universal good. He then discusses general and particular causes of changes in these charges. He thinks that there is great scope for reduction of the first four public charges, and recommends increased spending on care for the elderly, sick, orphans, etc., as well as the government employment of supernumeraries. On the issue of raising taxes, Petty was a definite proponent of consumption taxes. He recommended that in general taxes should be just sufficient to meet the various types of public charges that he listed. They should also be horizontally equitable, regular and proportionate. He condemned poll taxes as very unequal and excise on beer as taxing the poor excessively. He recommended a much higher quality of statistical information, in order to raise taxes more fairly. Imports should be taxed, but only in such a way that would put them on a level playing field with domestic produce. A vital aspect of economies at this time was that they were transforming from barter economies to money economies. Linked to this, and aware of the scarcity of money, Petty recommends that taxes be payable in forms other than gold or silver, which he estimated to be less than 1% of national wealth. To him, too much importance was placed on money, 'which is to the whole effect of the Kingdom… not [even] one to 100'. In making the above estimate, Petty introduces in the first two chapters of Verbum Sapienti the first rigorous assessments of national income and wealth. To him, it was all too obvious that a country’s wealth lay in more than just gold and silver. He worked off an estimation that the average personal income was £6 13s 4d per annum, with a population of six million, meaning that national income would be £40m. Petty produces estimates, some more reliable than others, for the various components of national income, including land, ships, personal estates and housing. He then distinguishes between the stocks (£250m) and the flows yielding from them (£15m). The discrepancy between these flows and his estimate for national income (£40m) leads Petty to postulate that the other £25m is the yield from what must be £417m of labour stock, the value of the people. This gives a total wealth for England in the 1660s of £667m. Petty's only statistical technique is the use of simple averages. He would not be a statistician by today's standards but during his time a statistician was merely one that employed the use of quantitative data. Because obtaining census data was difficult, if not impossible, especially for Ireland, he applied methods of estimation. The way in which he would estimate the population would be to start with estimating the population of London. He would do this by either estimating it by exports or by deaths. His method of using exports is by considering that a 30 percent increase in exports corresponds to a similar proportionate increase in population. The way he would use deaths would be by multiplying the number of deaths by 30 — estimating that one out of thirty people die each year. To obtain the population of all of England he would multiply the population of London by 8. Such a simple use of estimation could have easily have been abused and Petty was accused more than once of doctoring the figures for the Crown. (Henry Spiegel)