Under the heading of:
The Consequences of Bourgeois Virtues:
B. The Spiritual Good of the Bourgeoisie
And the other direction of causation is equally important: that commerce sweetened people. Cooperation, not alienation, is the usual result of commerce. Not diminishing social contact but increase. Speech dominates bourgeois society. Show the historical/sociological evidence of this. Coffee house, long-distance deals. Contrast with geniza, e.g.
It makes a difference whether people don’t speak or speak.
Paul Goodman (1971 , p. 3).
About Brindley the canal digger: “As plain a looking man as one of the boors of the Peake, or one of his own carters; but when he speaks, all ears listen, and every mind is filled with wonder, at the things he pronounces to be practicable”
T. Bentley The History of Inland Navigations, 1769, p. 101, quoted in (Langford, p. 416)).
A potent source of bourgeois virtues and a check on bourgeois vice is the premium that a bourgeois society puts on discourse. The bourgeois must talk. The aristocrat gives a speech; the peasant tells a tale. But the bourgeois must in the bulk of his transactions talk to an equal. “I will buy with you, sell with you, talk with you, walk with you, and so following.” It is wrong to imagine, as modern economics does, that the market is a field of silence. (Or at least it is wrong in anything but wholly perfect competition, and in such conditions, as has been realized for a century, there is a paradox of silence, solved on the blackboard by such talking constructs as the Walrasian auctioneer.)
For one thing, talk defines business reputation. A market economy looks forward and depends therefore on trust. The persuasive talk that establishes trust is of course necessary for doing much business. This is why co-religionists or co-ethnics deal so profitably with each other. Avner Greif has explored the business dealings of Mediterranean Jews in the Middle Ages, accumulating evidence for a reputational conversation: in 1055 one Abun ben Zedaka of Jerusalem, for example, “was accused (though not charged in court) of embezzling the money of a Maghribi trader. When word of this accusation reached other Maghribi traders, merchants as far away Sicily canceled their agency relations with him.” A letter from Palermo to an Alexandrian merchant who had disappointed the writer said, “Had I listened to what people say, I never would have entered into a partnership with you.” Reputational gossip, Greif notes, was cheap, “a by-product of the commercial activity [itself] and passed along with other commercial correspondence.” With such information, cheating was profitless within the community, though sometimes not so profitless outside it.
Old Believers in Russia during the eighteenth and nineteenth centuries held a similar position. The Old Believers refused to adopt the late seventeenth-century reforms in the Russian church, and were in other ways far from progressive. Yet because of their peculiarity they were able to establish a speech community within the larger society. Old Believers on the northern River Vyg, for example, were able in the early eighteenth century to become major grain merchants to the new St. Petersburg “by utilizing their connections with the other Old Believers’ communities in the southern parts of the country.” Sir William Petty observed at the time that “trade is not fixed to any species of religion as such, but rather to the heterodox part of the whole.” Any distinction will suffice. Thus Mennonites dominated the Dutch grain trade in the Golden Age and after. Quakers were great merchants in eighteenth-century England. The overseas Chinese, segregated from the rest of the population (and therefore able to talk inexpensively with each other about breaches of contract among their own), are more successful in trade than their cousins at home.
Defoe (Complete English Tradesman, 1726) notes that the Quakers were the originators of the fixed price offer usual now in rich countries, though he claims that “they by degrees came to ask, and abate [that is, bargain], just as other honest tradesmen do.” “These are, as I call them, ‘trading lies’ . . . [T]he honest tradesman does avoid them as much as possible.” But he sees it as silly to “pretend to go back to the literal sense,” which would make “it impossible for tradesmen to be Christians.” A trader who intends to pay at the end of the week and finds herself sometimes embarrassed, yet at length pays, is not a liar, but merely in business in a world without certitude. The “lie,” Defoe avers, is no more serious than what he calls “table-lies” (“Your pie, Granny, is the best I’ve ever tasted”) or “salutation-lies” (“What a lovely outfit!”).
The aristocrat does not deign to bargain. Hector tries to, but Achilles replies: “argue me no agreements. I cannot forgive you./ As there are no trustworthy oaths between men and lions,/ Nor wolves and lambs have spirit that can be brought into agreement.” The Duke of Ferrara speaks of his last duchess there upon the wall looking as if she were alive, “Even had you skill/ In speech–(which I have not)–to make your will/ Quite clear to such an one . . . . / –E’en then would be some stooping; and I choose/ Never to stoop.” The aristocrat never stoops; the peasant stoops to harvest or to run the machine; the bourgeois stoops daily to make his will quite clear, and to know the will and reasons of the other. The aristocrat’s speech is declamation, imitated by the professoriate. The aristocrat’s proofs are like commands, which is perhaps why Plato the aristocrat loved them so. Plato, it needs to be remembered, was a conspirator against democracy, a disdainer of law courts, a hater of poets, a friend of tyrants, a designer of closed societies. His proofs modeled on the new Greek mathematics convince, [give the Greek here to be persuasive. Go to his fattest statements in Gorgias or whatever and get the two Greek words he uses!], vincere, conquer. The bourgeois by contrast must persuade, sweetly, suadeo, from the same Indo-European root as “sweet.” As Plato does, of course, every time we pick him up and read.
The bourgeois goes at it with a will. About a quarter of national income is earned from merely bourgeois and feminine persuasion: not orders or information but persuasion, “sweet talk.” One thinks immediately of advertising, but in fact advertising is a tiny part of the total. Take the detailed categories of employment and make a guess as to the percentage of the time in each category spent on persuasion. Out of the 115 million civilian employment it seems reasonable to assign 100 percent of the time of the 760,000 lawyers and judges to persuasion; and likewise all the public relations specialists and actors and directors. Perhaps 75 percent of the time of the 14.2 million executive, administrative, and managerial employees is spent on persuasion, and a similar share of the time of the 4.8 million teachers and the 11.2 million salespeople (excluding cashiers). Half of the effort of police, writers, and health workers, one might guess, is spent on persuasion. And so forth. The calculation could be improved with more factual and economic detail; for instance, the workers could be weighted by salaries; the marginal product of persuasion could be considered in more detail; the occupational categories could be subdivided; the premium to better persuasion could be estimated from sales commissions: we intend here only to raise the scientific issue, not to settle it). The preliminary result is notable:
[Table next page]
Weighted sums yield 28.2 million out of 115 million civilian employment, or about a quarter of the labor force, devoted to persuasion.
The result can be checked with other measures. John Wallis and Douglass North measure fifty percent of national income as transaction costs, the costs of persuasion being part of these (1986). Expenditures to negotiate and enforce contract rose from a quarter of national income in 1870 to over half of national income in 1970 (Wallis and North 1986, Table 3.13). Their measurement is a model of how to make such calculations, and suggestive of the importance of talk in the economy. It is not precisely the measurement wanted here. Transactions costs include, for example, “protective services,” such as police and prisons, which “talk” only in an extended sense. Literal talk is special — in particular it is cheap, as police and prisons are not — in a way that makes it analytically separate from the rest of transaction costs.
Not all the half of American workers who are white-collar talk for a living, but in an extended sense many do, as for that matter do many blue-collar workers persuading each other to handle the cargo just so and especially pink collar workers dealing all day with talking people. And of the talkers a good percentage are persuaders. The secretary shepherding a document through the company bureaucracy is often called on to exercise sweet talk and veiled threats. The bureaucrats and professionals who constitute most of the white-collar workforce are not themselves merchants, but they do a merchant’s business inside and outside their companies. Note the persuasion exercised the next time you buy a suit. Specialty clothing stores charge more than discount stores not staffed with rhetoricians. The differential pays for the persuasion: “It’s you, my dear” or “The fish tie makes a statement.” As Smith says “everyone is practicing oratory Not everyone, perhaps, but in Smith’s time a substantial percentage and in modern times fully twenty-five percent.
The same point can be made from the other side of the national accounts, the product side. The more obviously talkie parts of production amount to a third of the total, and much of these must have been persuasion rather than information or command. Out of an American domestic product of $2360 billion in 1981 (note the change of year; there is nothing special about this year or that; Statistical Abstract, series 701, p. 424) the sum of Wholesale and Retail Trade ($353 billion by itself), Paper and Allied Products ($22.2 billion, producing memoranda for the circular file), Legal Services ($23.4 billion), Educational Services ($17.0 billion), Social Services ($10.7 billion), perhaps two-thirds of Government and Governmental Enterprises ($224 billion), and perhaps half each of Finance, Insurance, and Real Estate ($162 billion), of Hotels ($8.15 billion), and of Air Transport ($7.20 billion) amount to $828 billion, or about 35 percent of national product. Adjust it down if you will. The figure squares with the income side. Persuasion is about a quarter of national product and national income.
It is probably increasing in size. Jobs for peasants, proletarians, and aristocrats are disappearing, and jobs for the talkative bourgeoisie are what remain. The production of things has become and will continue to become cheaper relative to persuasion. I’ve noted that a piece of cotton cloth that sold for 70 or 80 shillings in the 1780s sold in the 1850s for 5 shillings. The cheapening of things first led peasants off the land: three-quarters of American workers in 1800 worked on farms; forty percent in 1900; eight percent in 1960; two-and-a-half percent in 1990. The two-and-a-half percent produced 800 times more than the three-quarters had. A lawyer or professor was not much more productive in 1990 than in 1800. But a farmer was more productive by a factor of 36. The making of things in factories will go the same way as the preparing of food in kitchens and the growing of crops on farms. The calculating power-adding, multiplying, and carrying-that sold for $400 in 1970 sold for $4 in 1990 and 4 cents in 2000. The proletarian labor required to make a radio, a window pane, or an automobile is dropping towards zero. Workers on the line in manufacturing peaked at about a fifth of the labor force after World War II and have since been falling, at first slowly and now quickly. In 2003 2 percent of the civilian labor force was in agriculture, 10 percent in manufacturing. What is left is hamburger flipping and secretarial work on the one side and bourgeois occupations, largely persuasive, on the other. In fifty years a maker of things on an assembly line will be as rare as a farmer, nonpersuaders vanishing into the background.
The delivery of information and commands partakes in the euthanasia of the maker. A farmer can turn on his computer in the morning and know at once the price of hogs on every exchange. A single source of information on hog prices does the work of fifty newspapers. The order to march can be conveyed cheaper by radio than by a lieutenant on a horse. Information and commands become cheaper and cheaper. But persuasion does not. The decision what to do with the hogs, knowing all there is to know about prices, is still made in the kitchen council by farmer and son and wife, persuading each other; or in the councils of the farmer’s mind. The decision about where to send the army is still a matter of persuasive talk.
One reason the importance of sweet talk will increase is that much of it is adversarial. If the other salesman has a computer-assisted video to persuade, then you will need it, too. If the defense in a personal injury case starts hiring economists to testify on the low value of the victims time, then the plaintiff will start hiring economists to persuade the other way. If teachers get better at persuading people to read books, then television executives will devote more resources to persuading them to watch reruns of the Beverly Hillbillies. The technology is irrelevant. Persuasion is in this way like pure queuing. The time (or something else) must be spent in a queue somehow or else the queuing will not serve its function of allocating bread sold for below the market price. Oregon Plans, queue tickets, and other technology of queuing have no effect on the amount spent. Likewise, persuasive energy must somehow be spent arguing or else the persuasion will not serve its function of allocating decisions to the proper side. The problem is that the decision making itself is intrinsically costless: after all, we could decide in an instant henceforth never to produce anything different from what we produced today, as rotten as such a plan would be. The decision would take the stroke of a dictator’s pen. Since it is not intrinsically costly (unlike the very production of information or orders) it will be made, so to speak, artificially costly.
* * * *
Is the persuasive talk of the bourgeoisie then “empty,” mere comforting chatter with no further economic significance? If that was all it was then the economy would be engaging in an expensive activity to no purpose. A quarter of national income is a lot to pay for economically functionless warm and fuzzies. The fact would not square with economics. The businesspeople circling La Guardia on a rainy Monday night could have stayed home. The crisis meeting in the plant cafeteria between the managers and the workers would lack point. Wasteful motion, or empty words, sit poorly with conventional economics. By shutting up we could pick up a $20 bill (or more exactly a $1,500,000,000,000 bill). That cannot be. A quarter of our working time in the marketplace is spent in persuasive converse.
Adam Smith knew. The second chapter of The Wealth of Nations speaks of “the faculty of . . . speech.” The book does not again speak of the faculty of speech in a foundational role, though Smith, who began his career as a teacher of rhetoric, did remark frequently on how business people and politicians talked together. In The Theory of Moral Sentiments he calls speech “the characteristical faculty of human nature.” The other half of his foundational formula, the faculty ofreason became in time the characteristic obsession of economists. Smith himself did not much pursue it. Economic Man, rationally seeking, is not a Smithian character. It was later economists, especially Paul Samuelson during the 1940s, who reduced economics to the reasoning of a constrained maximizer, Seeking Man, Homo petens. The seeking has a peasant cast to it: the maximization of known utility under known constraints sounds more like Piers Ploughman than Robinson Crusoe. The utilitarian reduction of all the virtues to one maximand makes all virtues into prudence. The wind-up mice of modern economic theory know nothing of integrity, humor, affection, and self-possession. Smith’s notion of Homo loquans squares better with the varied virtues of the bourgeoisie.
The high share of persuasion provides a scene for the bourgeois virtues. One must establish a relationship of trust with someone in order to persuade him. Ethos, the character that a speaker claims, is the master argument. So the world of the bourgeoisie is jammed with institutions for making relationships and declaring character, unlike that of the aristocracy or peasantry, who get their relationships and characters ready-made by status, and who in any case need not persuade. Thomas Buddenbrook bitterly scolds his unbusinesslike brother, a harbinger of bohemianism in the family: “In a company consisting of business as well as professional men, you make the remark, for everyone to hear, that, when one really considers it, every businessman is a swindler-you, a business man yourself, belonging to a firm that strains every nerve and muscle to preserve its perfect integrity and spotless reputation.”
The class work of an Austen novel is not done by portrayal of the middle class: but by the effect on the implied audience. The virtues recommended are not those of aristocrats or (and this is more surprising in the devout daughter of a clergyman) Christian. They are bourgeois, which is to say, helpful for a life in commerce. [Check this.] So notes Walter Benn Michaels (refer to him).
The bourgeoisie works with its mouth, and depends on word of mouth. Buddenbrooks is not social history (though Mann was proud of having “intuited and invented the thought that modern-capitalist acquisitive man, the bourgeois with his ascetic ideal of professional duty, is a creature of the Protestant ethic, completely on my own, without reading . . . learned thinkers, namely, Weber, Troeltsch, Sombart.” ) It imagines rather than reports Mann’s own family of Lübeck grain merchants. But if it testified to the attitudes towards the bourgeoisie only in 1901 (and Mann did go to a good deal of trouble to get his family history right) rather than in the 1850s it would still weigh. The fictional Tom speaks in the 1850s of his grandfather during the Napoleonic Wars: “he drove in a four-horse coach to Southern Germany, as commissary to the Prussian army-an old man in pumps, with his head powdered. And there he played his charms and his talents and made an astonishing amount of money.” Tom himself most enjoys “trade he came by through his own personal efforts. Sometimes, entirely by accident, perhaps on a walk with the family, he would go into a mill for a chat with the miller, who would feel himself much honored by the visit; and quite en passant, in the best of moods, he could conclude a good bargain.” At the crisis of 1848 the Assembly is trapped by a mob in the town hall. “The natural instinct towards industry, common to all these good burgers, began to assert itself: they ventured to bargain a little, to pick up a little business here and there.” Charming the generals, chatting with the miller, picking up a little business here and there.
On the other hand, idle talk is not bourgeois. Idle, artistic, romantic talk is a habit of the new bohemians sprung from the bourgeoisie, adumbrated in Christian Buddenbrook, of whom Tom the bourgeois says, “There is such a lack of modesty in so much communicativeness . . . . Control, equilibrium, is, at least for me, the important thing. There will always be men who are justified in this interest in themselves, this detailed observation of their own emotions, . . . poets” or indeed novelists like Heinrich and Thomas Mann.
Now of course the sweet talk among the bourgeoisie can be parodied, and has been for two centuries to the point of tedium. “Everybody puts his best foot forward before strangers. We all take care to say what will be pleasant to hear.” The intellectuals can sneer at the vulgarity of business talk (“Run it up the flagpole and see if anyone salutes”), “the clumsy but comfortable idioms which seemed to embody to [the burgers] the business efficiency and the easy well-being of their community.”
And speech of course can be false. In Buddenbrooks Grünlich is the bad bourgeois, a mere acquirer. His false speech is aimed from the beginning at acquiring Antonie and her fortune: “He regarded her with the air of a satisfied possessor.” Grünlich gets his rival for Antonie’s hand out of the way by committing the worst sin among the bourgeoisie, lying about a contract: he claims falsely that she had promised him. It develops that he was lying, too, about his firm’s prosperity. At first he seems to the elder Buddenbrook “an agreeable man, and well recommended, the son of a clergyman. I have business dealings with him.” Grünlich “talked business and politics, and spoke soundly and weightily.” Buddenbrook is later “wounded in his pride as a merchant, . . . the disgrace of having been so thoroughly taken in,” taken in by a torrent of sweet words.
Bourgeois friendship is false in aristocratic or peasant terms. Tom’s father recalls his own business experiments as a young man: “My journey to England had for its chief purpose to look out for connections there for my undertakings. To this end I went as far as Scotland, and made many valuable acquaintances.” These acquaintances of which one hears so much in a bourgeois society are hardly friends on the aristocratic model of Achilles and Patroclus. The friends could turn, exhibiting “all the sudden coldness, the reserve, the mistrust at the banks, with ‘friends,’ and among firms abroad which such an event, such a weakening of working capital, was sure to bring in its train.”
The virtues of the bourgeois are those necessary for town life, for commerce and self-government. The virtue of tolerance, for example, can be viewed as bourgeois. The experience of uncertainty in trading creates a skepticism about certitude-the arrogant and self-possessed certitude of the aristocrat or the humble and routine certitude of the peasant. As Arjo Klamer has pointed out to me, “the dogma of doubt” is bourgeois. City air makes one free.
Bourgeois charity, again, if not the “charity,” meaning love, of the King James translation of the Bible, runs contrary to the caricature of greed. More than the peasant or aristocrat the bourgeois gives to the poor-as in the ghettos of Eastern Europe or in the small towns of America. Acts of charity follow the bourgeois norm of reciprocity. The American Gospel of Wealth, founding hospitals, colleges, and libraries wherever little fortunes were made, is a bourgeois notion, paying back what was taken in profit. Middle class people in the nineteenth century habitually gave a Biblical tenth of their incomes to charity. The intrusion of the state into charity killed the impulse, remaking charity into a taille imposed on grumbling peasants: I gave at the office.
* * * *
Economists since Bentham have viewed talk as cheap and culture as insignificant. Yet humans are talking animals, and the animals talk a great deal in their forums, agoras, marketplaces. Of course the economist does not have to pay attention to everything that happens in an economy. That farmers chew tobacco or paint traditional designs on their barns while dealing in corn does not necessarily have to appear in the econometrics. What would have to appear is a large expenditure, since expenditure is the economist’s measuring rod.
Economics as presently constituted does not acknowledge the fact (if it isa fact: I repeat that the calculation would need much elaboration to be scientifically persuasive). The conversation of the economy is taken as irrelevant to economic science. As the late Don Lavoie put it, “economists seem to agree that the scientific discourse of economics should dissociate itself from the everyday discourse of the economy.” He observed dryly, “Economists are not so clear why they think this.”
The economy, one might say from the statistics, “rests” on persuasive talk. Yet economists, to repeat a point of methodology obvious to economists but obscure to most of their critics, are not required to pay attention even to everything the economy “rests” on. It also rests, for example, on engineering, but in speaking of the economics of bridges and other social overhead capital an economist does not need to know about the equilibrium equations for three-dimensional rigid bodies.
In the present case, when economists can reduce some transaction to a silent physical action, they can properly ignore the talk, at least in its effects on the equilibrium price. Adam Smith, to continue the quotation from Lectures on Jurisprudence, said that persuasion, “being the constant employment of trade of every man, in the same manner as artisans invent simple methods of doing their work, so will each one here endeavor to do his work in the simplest manner. That is bartering, by which they address themselves to the self interest of the person and seldom fail immediately to gain their end.”
Of course, a sociologist would point out that the institutions of a bartering grocery store “rest” on all manner of talk, such as the giving of orders to the junior grocery clerk to spend the next hour fronting the stock in aisles 6 through 8. The anthropologist reminds economists that “behind” their market lies a culture, which is another talking matter. But given the culture and the institutions (a big given, admittedly), and confining attention to the immediate result, if the clerk does not like the assignment he can silently walk, exercising his option of what Albert Hirschman calls “exit.” He is not a slave. Likewise, a man who tries to haggle with his local grocery store about the price of a quart of milk is wasting his breath and wasting the grocer’s time. If he thinks he can get a better price down the street, he can walk. If the grocer thinks the next customer will pay the price, he can ignore the haggler. The talk in such cases is not essential for the economics.
Walk or talk. To put it another way, that many transactions involve talk may be interesting but need not be a criticism of economics. The physical walking may still set tight limits on what can be charged. People bargain over houses and automobiles, talking a lot, yet no one will be talked into selling a four bedroom apartment overlooking Central Park for $3.57 or into buying a ’77 Chevy with a little rust and 220,000 miles for $500,000. The customer will walk away from such offers. What matters is the size of the “gold points” within which silent trade confines the price. If the gold points are narrow, the talking does not change the deal. If they are wide, however, it may well change it.
A case of wide gold points, by definition, is pure bargaining. Two people meet in the middle of the Sahara, alone. One person has plenty of water but no food; the other plenty of food but no water. At what price will the deal take place? Obviously, it depends on the bargaining skills of the two. Economists, truth be known, have not made much progress in understanding situations of pure bargaining. Game theory for all its wonders has not gotten far on the matter.
The theoretical impasse arises because bargaining is talk, all the way down. As the food owner in the Saharan encounter, Arjo claims forcefully that he has a physical ailment requiring an unusual amount of both water and food. Deirdre detects a ruse, and offers little of her water in exchange for his pound of food. Arjo weeps affectingly; Deirdre’s heart softens, and she hands over half her water. Or she laughs sardonically (she is a hard lady) and portions out to Arjo a tiny swig in exchange for most of his food. It depends on talk.
This unsatisfactory conclusion relates to a basic feature of speech, that it can apparently be trumped, cheaply, in a way that sweaty physical action cannot. Suppose you devised a rule that would predict the bargaining speech of lonely owners of water in the middle of Sahara. Would this permit you to extract the water at a low price? No. As economists have pointed out repeatedly, if one person is predictable, the other can exploit the predictability, which will suggest to the exploited one that he had better randomize. If you’re so smart about bargaining, why ain’t you rich?
A limit on calculability is a feature of any speaking. If anyone could get their way by shouting, for example, then everyone would shout, as at a cocktail party, arriving by the end of the party hoarse but without having gotten their way. The philosopher H. P. Grice affixed an economic tag to the trumping of speech conventions, “exploitation.” The linguist Stephen Levinson puts his finger on the limits of formalization when language is involved: “[T]here is a fundamental way in which a full account of the communicative power of language can never be reduced to a set of conventions for the use of language. The reason is that wherever some convention or expectation about the use of language arises. there will also therewith arise the possibility of the non-conventional exploitation of that convention or expectation. It follows that a purely . . . rule-based account of natural language usage can never be complete.”
A joke among linguists makes the point (the story is said to be true). A pompous linguist was giving a seminar in which he claimed that while there were languages in which two negatives made a positive (as in Received Standard English: “I did not see nobody” = “I saw somebody”) or two negatives made a negative (standard Italian: “Non ho visto nessuno” = “I did not see nobody” = “I did not see anybody”), there are no languages in which two positives made a negative. Pause. Then a smart aleck in the back row says loudly, with a sneer in his voice, “Yeah, yeah.” Any rule of language can be trumped for effect.
The game theorist Joseph Farrell has made a similar point in a paper of his called “Meaning and Credibility in Cheap-Talk Games.” What I call “trumping” he calls “neologism,” and finds that games are sensitive to its use. “We could conclude that we have no satisfactory positive theory in a one-shot game [a conclusion which may explain the unpopularity of the paper with referees]. . . . Games should be taken in context, especially when analyzing the effects of communication. Language that could not survive in equilibrium if the world were nothing but a particular game, can nevertheless affect the outcome of the game.”
Economists specialize in knowing about costs and benefits. But someone — maybe even a specialized economist — might want to learn about the speech by which people construct their stories the cost and benefit. Maybe some useful economics can be done, or the existing economics modified. Adam Smith, as usual, put the issue well. The division of labor is the “consequence of a certain propensity . . . to truck, barter, and exchange . . . [W]hether this propensity be one of those original principles in human nature, of which no further account can be given; or whether, as seems more probable, it be the necessary consequence of the faculties of reason and speech.” Smith, who began his career as a teacher of rhetoric, remarked frequently on how business people and politicians talked together. Half of his foundational formula, the faculty of reason, became in time the characteristic obsession of economists. Smith himself did not much pursue it. Economic Man, whether speaking or seeking, I have noted, is not a Smithian character.
Speaking Man has never figured much in economics, even among institutionalist economists. A man acts, by and for himself. That is what utility functions or institutions or social classes or property rights are about. No need to speak. Smith would have disagreed. Towards the end of The Theory of Moral Sentiments he dug behind the faculty of speech (which led to the propensity to exchange, which led to the division of labor, which led to the wealth of nations). He connected it to persuasion, which is to say, speech meant to influence others: “The desire of being believed, the desire of persuading, of leading and directing other people, seems to be one of the strongest of all our natural desires.” Compare his Lectures on Jurisprudence, in the passage quoted: “Men always endeavor to persuade others . . . [and] in this manner every one is practicing oratory through the whole of his life.” Though always Smith, and his contemporaries, admitted payment as a form of persuasion: “Sir, you may make the experiment,” said Johnson to Boswell. “Go into the street, and give one man a lecture on morality, and another a shilling, and see which will respect you the most.”
Here maybe an empirical measurement of contacts increasing in 18th century. Three stages. Self-sufficiency –> silence. Handicraft –> chat. Industry (what Frank Knight called an “enterprise” economy, with his wheel of wealth) –> conversation. Complex speech, signaling, many stages of production, millions of interactions implied.