William Petty

Born May 26, 1623, in Romsey, Hampshire; died Dec. 16, 1687, in London. English economist. Founder of bourgeois classical political economy.

Petty was the son of a poor tradesman. He studied medicine at the universities of Leiden, Paris, and Oxford. A man of diverse talents, he invented a copying machine in 1647, received his medical degree in 1649, and became a professor of anatomy and music in 1651. He was a large-scale landowner. In 1652 he carried out a “land survey” of Ireland, under assignment from Cromwell’s government.

Petty became an ideologist of the English bourgeoisie, which had grown more powerful after the English Bourgeois Revolution of the 17th century. His main works were A Treatise of Taxes and Contributions (1662), A Word to the Wise (1665), The Political Survey or Anatomy of Ireland (1672), and Political Arithmetick (1683). The influence of mercantilist ideas is perceptible in his early works but absent in his later ones, particularly Quantulumcunque Concerning Money (1682). Unlike the mercantilists, he believed that the source of wealth is not circulation but production. Although he considered the economic development of society to be a function of objective laws, he equated social and economic laws with the laws of nature, regarding them as eternal and unchanging. His method in studying economic phenomena was borrowed from the natural sciences and supplemented with statistical analysis.

Petty was the first exponent of the labor theory of value. He distinguished intrinsic value, which he called “natural price,” from market price. He defined value in terms of labor expended, establishing the quantitative dependence of the magnitude of value on labor productivity. However, he erroneously measured the magnitude of value by two standards: land and labor. He attempted to resolve the question of the origin of surplus value by determining the value of goods in terms of the labor expended in producing them.

In Petty’s works the general form of surplus value is rent, the specific manifestations of which are land rent and cash rent (interest). Petty was the first economist to pose the question of differential land rent. He also discussed the question of the price of land in a scientific manner. In his views on questions of economic policy, he reflected the tendency to subordinate the development of the country’s economy to the interests of industrial capital. However, he considered state intervention legitimate for regulation of the national economy. On the whole, his works are descriptive, but in analyzing a number of economic phenomena, he comes close to discovering their essence.