Schumpeter’s review assesses the first two volumes of G.-H. Bousquet’s Institutes de Science économique, praising their pedagogical clarity while questioning whether so comprehensive a treatise can serve as a beginner’s introduction. Its central judgment is that Bousquet does more than communicate established doctrine: he develops it through two ambitious syntheses, extending equilibrium analysis toward the social environment of economic life and reconnecting price theory with subjective welfare.
Within the precincts of pure theory, the centre of this body of doctrine is still the concept of equilibrium.
For Schumpeter, equilibrium supplies both a way to understand the history of economic theory and its indispensable analytical instrument. Bousquet’s distinctive teaching decision is to place it at the outset, presenting the substance of Walras and Pareto in accessible, non-mathematical language. The review then follows the second volume’s extension of equilibrium reasoning to natural, racial, institutional, political, technological, and demographic conditions. Schumpeter’s approval is qualified: the concept has less secure justification in this wider field than in pure theory, yet it gives problems sharper contours and connects abstract propositions with the social questions that interest readers. Bousquet’s proposed synthesis of Pareto and Sombart aptly names this effort to join theoretical structure to knowledge of economic environments.
Returning to the first volume, Schumpeter commends its discussions of science, method, practical applications, and intellectual history. His principal conceptual concern, however, is the tension between equilibrium theory’s emancipation from utility and the questions this emancipation leaves unanswered.
But "Price-Economics" is powerless to deal with a most important set of problems, and this accounts for the emergence of "Welfare-Economics," which necessarily relies on other methods and the success of which to some extent disproves the scruples we may harbour about such things as comparing the satisfactions of different people.
Welfare economics thus gives renewed importance to utility theory rather than simply superseding it. Bousquet, despite his Paretian commitments, returns to Gossen’s two laws and directly addresses welfare measurement. Schumpeter distinguishes two possible approaches: welfare can be treated formally as a scalar function of consumption quantities, describing observable behaviour without claims about feelings, or it can retain a fully subjective, hedonistic meaning. Bousquet chooses the latter. This choice makes investigation of actual feelings unavoidable and exposes the inadequacy of older utility theory.
On the strength of this, he boldly postulates that subjective Welfare is a constant in the long run.
The premise behind this striking conclusion is adaptation: habit and the emergence of new wants soon erase awareness of improved economic conditions, leaving only short-period changes subjectively significant. Schumpeter recognizes the theoretical force of drawing out these consequences without endorsing the conclusion unreservedly. His closing praise concerns the energy, learning, and originality of Bousquet’s argument. The review’s lasting interest lies in this discriminating openness: equilibrium remains foundational, but neither its extension beyond pure theory nor the reduction of welfare to price relations can be accepted without examining what each conceptual move explains—and what it excludes.
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