Henry George on Disproof of the Malthusian Theory

The proposal, advocated in the third quarter of the eighteenth century by the French physiocrats, and in particular by the great French economist, Fran,ois Quesnay, that taxation should be based entirely on the net rent of land (presumed to be the only source of true net income in existence), was rediscovered and fervently propagated some hundred years later by the self-taught American economist Henry George (1839-97). George, who grew up in Philadelphia and embarked on a successful career as a journalist and commentator on economic and social issues in the mid-1860s in San Francisco, sought to understand the reasons for what he saw as a simultaneous advance of poverty and wealth in the United States. He claimed to have found it in the private ownership of land. As population increases, land becomes relatively scarcer, hence grows in value: those who work on it must pay increasing rents for the privilege. The Single Tax, he argued, was the called-for remedy. George's most important book, Progress and Poverty, published in 1879, was widely read and had an important influence on economic discourse, though not palpably on policy, in late nineteenth century America and also in Western Europe. Numerous passages in Progress and Poverty discuss the interrelationships between population growth and the economy. George sought to show that population growth is fully compatible with material progress. Chapter 4 of Book II in Progress and Poverty, reproduced below in full, is entitled Disproof of the Malthusian Theory. The central point of George's disproof ' anticipates numerous later formulations. George simply points out that the total wealth produced has in fact been increasing faster than population. This observed empirical relationship, hardly surprising under conditions of rapid technological change and capital accumulation, is then generalized as one that holds in all times and circumstances. Thus, with an equitable distribution of wealth, the greater is the population the greater is the comfort that can be provided to each individual. Whether the implied independence of production from distribution is valid, whether the presence of some fixedfactors can ultimately frustrate the expectation of increasing (or even constant) returns to scale, or whether an achieved rate of improvement in income per head is as large with a faster rate of population growth as it could be with a slower rate, are questions not explicitly discussed

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