Thomas Tooke

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Thomas Tooke
Thomas Tooke.jpg
Born(1774-02-28)28 February 1774
Died26 February 1858(1858-02-26) (aged 83)
London, England
NationalityEnglish
Field Econometrics
School or
tradition
Classical economics

Thomas Tooke ( /tʊk/ ; 28 February 1774 – 26 February 1858) was an English economist known for writing on money and economic statistics. After Tooke's death the Statistical Society endowed the Tooke Chair of economics at King's College London, and a Tooke Prize.

Economic statistics is a topic in applied statistics that concerns the collection, processing, compilation, dissemination, and analysis of economic data. It is also common to call the data themselves 'economic statistics', but for this usage see economic data. The data of concern to economic statistics may include those of an economy of region, country, or group of countries. Economic statistics may also refer to a subtopic of official statistics for data produced by official organizations. Analyses within economic statistics both make use of and provide the empirical data needed in economic research, whether descriptive or econometric. They are a key input for decision making as to economic policy. The subject includes statistical analysis of topics and problems in microeconomics, macroeconomics, business, finance, forecasting, data quality, and policy evaluation. It also includes such considerations as what data to collect in order to quantify some particular aspect of an economy and of how best to collect in any given instance.

Royal Statistical Society

The Royal Statistical Society (RSS) is one of the established statistical societies. It has three main goals. The RSS is a British learned society for statistics, a professional body for statisticians, and a charity which promotes statistics for the public good.

Kings College London public research university in London, United Kingdom

King's College London is a public research university located in London, United Kingdom, and a founding college and member institution of the federal University of London. King's was established in 1829 by King George IV and Arthur Wellesley, 1st Duke of Wellington, when it received its first royal charter, and claims to be the fourth oldest university institution in England. In 1836, King's became one of the two founding colleges of the University of London. In the late 20th century, King's grew through a series of mergers, including with Queen Elizabeth College and Chelsea College of Science and Technology, the Institute of Psychiatry, the United Medical and Dental Schools of Guy's and St Thomas' Hospitals and the Florence Nightingale School of Nursing and Midwifery.

Contents

In business, he served several terms between 1840 and 1852 as governor of the Royal Exchange Corporation. Likewise, he served for several terms as chairman of the St Katharine's Docks company. [1] He was also an early director of the London and Birmingham Railway. [2]

St Katharine Docks docks in the East End of London

St Katharine Docks is a former dock and now a mixed-used district in Central London, in the London Borough of Tower Hamlets and within the East End. It lies on the north bank of the River Thames, immediately downstream of the Tower of London and Tower Bridge. From 1828 to 1968 it was one of the commercial docks that made up the Port of London. It is in the redevelopment zone known as Docklands, and is now a popular housing and leisure complex.

London and Birmingham Railway early British railway company (1837–1846)

The London and Birmingham Railway (L&BR) was an early railway company in the United Kingdom, existing from 1833 to 1846, when it became part of the London and North Western Railway (L&NWR).

Life

Born at Kronstadt on 29 February 1774, he was the eldest son of William Tooke, at that time chaplain to the British factory there. Thomas began his professional life at the age of fifteen in a house of business at St Petersburg, and subsequently became a partner in the London firms of Stephen Thornton & Co., and Astell, Tooke, & Thornton. [3]

Kronstadt Municipal town in Saint Petersburg, Russia

Kronstadt, also spelled Kronshtadt, Cronstadt or Kronštádt is an early 18th-century foundation which became an important international centre of commerce whose trade role was eclipsed by the growth of its strategic significance in the ensuing centuries as the primary maritime defence outpost of the former Russian capital. It is now the port city in Kronshtadtsky District of the federal city of Saint Petersburg, Russia, located on Kotlin Island, 30 kilometers (19 mi) west of Saint Petersburg, near the head of the Gulf of Finland. It is linked to the former Russian capital by a combination levee-causeway-seagate, the St Petersburg Dam, part of the city's flood defences, which also acts as road access to Kotlin island from the mainland. In March 1921, the island city was the site of the Kronstadt rebellion.

William Tooke British clergyman and historian of Russia

William Tooke (1744–1820) was a British clergyman and historian of Russia.

He took no serious part in discussion of economic questions until 1819, when he gave evidence before committees of both Houses of Parliament on the resumption of cash payments by the Bank of England. Tooke was one of the earliest supporters of the free trade movement which assumed the form in the petition of the merchants of the City of London presented to the House of Commons by Alexander Baring, on 8 May 1820. This document was drawn up by Tooke; and the circumstances which led to its preparation are described in the sixth volume of his History of Prices. Lord Liverpool's government, especially through William Huskisson after 1828, moved in the direction sought. [3]

Bank of England Central bank of the United Kingdom

The Bank of England is the central bank of the United Kingdom and the model on which most modern central banks have been based. Established in 1694 to act as the English Government's banker, and still one of the bankers for the Government of the United Kingdom, it is the world's eighth-oldest bank. It was privately owned by stockholders from its foundation in 1694 until it was nationalised in 1946.

Free trade Absence of government restriction on international trade

Free trade is a trade policy that does not restrict imports or exports; it can also be understood as the free market idea applied to international trade. In government, free trade is predominantly advocated by political parties that hold liberal economic positions while economically left-wing and nationalist political parties generally support protectionism, the opposite of free trade.

City of London City and county in United Kingdom

The City of London is a city and local government district that contains the historic centre and the primary central business district (CBD) of London. It constituted most of London from its settlement by the Romans in the 1st century AD to the Middle Ages, but the agglomeration has since grown far beyond the City's borders. The City is now only a tiny part of the metropolis of London, though it remains a notable part of central London. Administratively, it forms one of the 33 local authority districts of Greater London; however, the City of London is not a London borough, a status reserved for the other 32 districts. It is also a separate county of England, being an enclave surrounded by Greater London. It is the smallest county in the United Kingdom.

It was to support the principles of the merchants' petition that Tooke, with David Ricardo, Robert Malthus, James Mill, and others, founded the Political Economy Club in April 1821. From the beginning Tooke took part in its discussions, and continued to attend its meetings to the end of his life. [3]

David Ricardo British political economist, broker and politician

David Ricardo was a British political economist, one of the most influential of the classical economists along with Thomas Malthus, Adam Smith and James Mill.

James Mill Scottish historian, economist, political theorist and philosopher

James Mill was a Scottish historian, economist, political theorist, and philosopher. He is counted among the founders of the Ricardian school of economics. His son, John Stuart Mill, was also a noted philosopher of liberalism, utilitarianism and the civilizing mission of the British Empire.

The Political Economy Club was founded by James Mill and a circle of friends in 1821 in London, for the purpose of coming to an agreement on the fundamental principles of political economy. David Ricardo, James Mill, Thomas Malthus, and Robert Torrens were among the original luminaries.

Out of controversy over paper money emerged the Bank Charter Act 1844, the main object of which was to prevent the over-issue of notes. Tooke was opposed to the provisions of the act. He thought that by some changes in the management of the Bank of England, coupled with the compulsory maintenance of a much larger reserve of bullion, more satisfactory results would be achieved. [3]

Bank Charter Act 1844 United Kingdom legislation

The Bank Charter Act 1844, sometimes referred to as the Peel Banking Act of 1844, was an Act of the Parliament of the United Kingdom, passed under the government of Robert Peel, which restricted the powers of British banks and gave exclusive note-issuing powers to the central Bank of England. It is one of the Bank of England Acts 1694 to 1892.

Besides giving evidence on economic questions before several parliamentary committees, such as those of 1821 on agricultural depression and on foreign trade, of 1832, 1840, and 1848 on the Bank Acts, Tooke was a member of the factories inquiry commission of 1833. He retired from active business on his own account in 1836, but was governor of the Royal Exchange Assurance Corporation from 1840 to 1852, and was also chairman of the St. Katharine's Dock Company. He was elected a Fellow of the Royal Society in March 1821, and correspondant de l'Institut de France (Académie des Sciences Morales et Politiques) in February 1853. He resided in London at 12 Russell Square, then later in Richmond Terrace, and at 31 Spring Gardens, where he died on 26 February 1858. [3] He is buried at Kensal Green Cemetery. [4]

In the year after Tooke's death the Tooke professorship of economic science and statistics at King's College, London, was founded in his memory, the endowment being raised by public subscription. There was a watercolour sketch of Tooke in the office of the Royal Exchange Assurance Corporation, and a portrait was painted by Sir Martin Archer Shee. [3]

Works

As a follower of Ricardo, Francis Horner, and Huskisson, Tooke was a supporter of the principles embodied in the report of the bullion committee of 1810. The three years which followed the Resumption of Cash Payments Act 1819 were marked by a fall in the prices of nearly all commodities. An opinion gained ground that the fall was due to a contraction of the currency which was assumed to result from the return to cash payments. To combat this view was the task to which Tooke applied himself in his earliest work, Thoughts and Details on the High and Low Prices of the last Thirty Years (1823), and the same line of argument is pursued in his Considerations on the State of the Currency (1826), and in a Letter to Lord Grenville (1829). He entered on a detailed examination of the causes which might affect prices, and claimed to establish the conclusion that the variations, both during the period of restriction and after the resumption, were due to circumstances directly connected with the commodities themselves, and not to alterations in the quantity of money. [3]

The History of Prices

Tooke is best known for his History of Prices and of the State of the Circulation during the Years 1793–1856 (6 vols., 1838–1857). In the first four volumes he treats (a) of the prices of corn, and the circumstances affecting prices; (b) the prices of produce other than corn; and (c) the state of the circulation. The two final volumes, written with William Newmarch, deal with railways, free trade, banking in Europe and the effects of new discoveries of gold.

The first two volumes dealt with the period from 1793 to 1837, and were published in 1838. His conclusions were that the high prices which, speaking generally, ruled between 1793 and 1814 were due to a relatively large number of unfavourable seasons, coupled with the obstructions to trade which were created by the Napoleonic Wars; while the lower range of prices in the subsequent years was attributable to a series of more prolific seasons, the removal of the state of war, and improvement in the processes of manufacture and industry. [3]

The History of Prices was completed in six volumes; the third, dealing with the years 1838–9, was published in 1840, the fourth in 1848, and the fifth and sixth in 1857, the year before Tooke's death. The whole work comprises an analysis of the financial and commercial history of the period which it covers. The later volumes record of the steps by which Tooke gradually severed himself from the supporters of the currency theory, the direct heirs of the bullionists of 1810 and 1819. This summary of Tooke's views represents his opinions as they took shape between 1840 and 1844, and were defined in his Enquiry into the Currency Principle (1844). But in his earlier writings there are many passages inconsistent with his later opinions. [3]

The supporters of the 'currency theory,' whose principles were adopted by Robert Peel and embodied in the Act of 1844, were represented by Samuel Jones Loyd, Robert Torrens, and George Warde Norman. They contended that banks of issue, by the arbitrary extension of their circulation, could produce a direct effect on prices, and thus stimulate financial speculation; that convertibility on demand was not a sufficient safeguard; and that the only adequate remedy was to separate the business of issue from that of banking in such a way that the former should regulate itself automatically, and that the discretion of the directors should be confined to the latter. [3]

Tooke, on the other hand, reinforced later on by John Fullarton and James Wilson, maintained that a paper currency which was readily convertible on demand must necessarily conform to the value of a purely metallic currency; that for this purpose no other regulation was required beyond ready convertibility; that under these conditions banks had no power of arbitrarily increasing their issues; and that the level of prices was not directly affected by such issues. Before the committee of 1832 Tooke stated that, according to his experience, a rise or fall of prices had invariably preceded, and could not therefore be caused by, an enlargement or contraction of the circulation. [3] This view, while inconsistent with the quantity theory of money, is consistent with the real bills doctrine. On this view, a fall in the value of the assets of a money-issuing bank would cause the value of the bank's notes to fall. The public would then require more notes to conduct business, and the bank would willingly issue those notes to customers who offered assets of adequate value in exchange. Thus the quantity of notes would increase after the price level had risen.

Family

He married, in 1802, Priscilla Combe, by whom he had three sons.

Bibliography

A History of Prices in six volumes:

Notes

  1. John Francis (1862). History of the Bank of England: Its Times and Traditions, from 1694–1844.
  2. John Francis (1851). A History of the English Railway.
  3. 1 2 3 4 5 6 7 8 9 10 11 "Tooke, Thomas"  . Dictionary of National Biography . London: Smith, Elder & Co. 1885–1900.
  4. Paths of Glory. Friends of Kensal Green Cemetery. 1997. p. 99.

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References

Obituaries

The National Portrait Gallery has two pictures of Tooke

There is information on the Tooke chair and the distinguished economists who have held it in