848. D. H. Robertson to Harrod , 4 October 1938 [a]

[Follows on from 842 ]

Trinity [College, Cambridge]

4 October 1938

My dear Roy,

I have read these with much admiration for their relentless vigour & lucidity. [1] As you expected, I am only in partial sympathy with the line of approach, but, regarding myself as editor and not as reviewer, there are only two places where I feel I must cry out.

P. 6. [2] "Recently ...". Reaction through the capital market may not be part of the "classical" theory in the sense of that explained by Ricardo, Thornton, Torrens etc: but it is surely part of the traditional theory. Surely every pre-war textbook explained how if the B of E was losing gold it would put up its rate, & that would deter bills from coming to London for rediscount (see e.g. Haberler, I.T. pp 49-51 [3] ).

p. 35. [4] You seem to be, though I'm sure you're not really, attempting to saddle "the classical theory" with the view that a rise in prices will lead to a reduction of imports, whereas of course (being immune from the modern heresy of muddling up prices and marginal labour costs) it said the exact opposite.

Small verbal changes suggested for consideration on pp 18, 37, 49, 55, 56, 86.

JMK is no longer editor, so no need to send the stuff to him unless you want his comments for their own sake. [5]

I find myself full of foreboding,--especially lest we should have lost the USA for good.



  1. 1. Refers to a draft of the passages altered in chapter VI of the second edition of Harrod's International Economics ( 1939:3 ). The draft does not survive.

    2. International Economics ( 1939:3 ), p. 116.

    3. G. Haberler, The Theory of International Trade with its Applications to Commercial Policy, London: Hodges, 1936 (translated from the German 1933 edition). Harrod reviewed Haberler's book for International Affairs ( 1936:12 ).

    4. International Economics ( 1939:3 ), p. 37.

    5. Harrod sent it to Keynes anyway: see 859 R.

    1. a. ALI, two pages on one leaf, in HP IV-990-1069d/61.

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