Emil Kauder, “The Retarded Acceptance of the Marginal Utility Theory” (1953)

This single-author journal article is a history-of-economic-thought essay on why marginal utility was not accepted earlier. Its scope runs from seventeenth- and eighteenth-century value theory to the reception of Menger, Jevons, and Walras. Kauder’s main distinction is between discovery and acceptance: subjective value theory existed long before 1870, but disciplinary and cultural conditions delayed its authority.

Before 1870 the history of the theory of value shows rather strange features, not easily paralleled in the history of any other science.

Kauder opens by arguing that Italian, French, and Swiss writers had already developed much of the utility approach: utility and scarcity explained goods, money, and wages; Turgot anticipated later price theory; Bernoulli gave a mathematical treatment; Lloyd later supplied a key marginal insight. The puzzle is why British classical economics continued to privilege objective value and labor cost. Kauder rejects simple ignorance, since Smith and others had some access to continental natural-law and economic discussions.

In the seventeenth and eighteenth centuries it was not ignorance which accounted for the dividing line between the two opposing points of view, but rather the antagonism between the Aristotelian-Thomistic and the Protestant social schools of thought.

The article’s central conceptual move is to connect theories of value with inherited moral theology. Protestant thinkers, especially those formed by Calvinist culture, placed work at the center of social order; this made labor value attractive not merely as measurement but as a way to join market exchange to divine and moral purpose. Catholic and Aristotelian-Thomistic intellectual settings, by contrast, lacked this glorification of labor and were more open to value-in-use. Kauder is careful not to reduce authors mechanically to church membership; his claim concerns the durable effects of early education.

These indelible fundamentals created specific social outlooks which separated the two camps.

The second section develops the contrast. Locke and Smith could combine Puritan esteem for work with the Aristotelian-Scholastic idea of just price, producing a value theory in which fair exchange rests on labor equivalents. The Italo-French school drew differently from Aristotle: economic action was oriented toward need, satisfaction, and the “good life,” so valuation asked what goods do for human enjoyment rather than how much work they embody.

Instead of work, moderate pleasure-seeking and happiness form the center of economic actions, according to Aristotelian and Thomistic philosophy.

Kauder’s thesis is thus deliberately sociological: rival value theories were not just technical alternatives, but products of different moral worlds. Yet he also marks the limits of this explanation. In the nineteenth century, confessional formation no longer mapped neatly onto economic doctrine. Marshall is treated as a late partial exception: Evangelical discipline helps explain his attraction to costs and supply even while he used marginal utility. But Lloyd, Longfield, Gossen, Menger, and Walras do not fit the older Catholic-Protestant schema.

The belated acceptance of marginal utility in the nineteenth century cannot be explained by the Aristotelian-Calvinistic dichotomy.

Kauder therefore shifts from religious background to the internal history of economics. He rejects three competing explanations: marginalism was not simply hedonistic psychology, since major marginalists were not all sensualists; not a neo-Kantian revival, since Vienna was not chiefly Kantian; and not bourgeois apologetics, since the theory could be used by socialists, reformers, and anarchists. The delay must instead be explained by the prestige of classical economics and the later anti-theoretical climate of the historical school.

The reasons for the delayed acceptance of marginal utility in the nineteenth century can be found only in the history of economic science itself.

Ricardo’s search for an objective measure of value fixed the agenda so strongly that alternative subjective theories went unnoticed. Lloyd and Longfield appeared before economists were ready to hear them; Gossen appeared later, but as an academic outsider in a German environment suspicious of abstract theory. Menger, Jevons, and Walras succeeded because they wrote under better institutional conditions, in countries where theoretical analysis still had standing and where rigid labor value had already weakened.

The long period of delay had ended.

The article remains relevant because it refuses to treat the marginal revolution as a sudden discovery. Kauder instead presents it as the belated recognition of a long-available tradition, first blocked by Protestant-labor and classical-value commitments, then by disciplinary prestige and institutional reception.