Arthur Cecil Pigou
English economist (1877–1959) who founded welfare economics and originated the Pigouvian tax for correcting the gap between private and social cost — a framework with direct roots in the Edwardian land-value-tax debate.
Overview
Arthur Cecil Pigou was an English economist who succeeded Alfred Marshall as Professor of Political Economy at the University of Cambridge in 1908, holding the chair until 1943. His most influential book, The Economics of Welfare (1920, an expansion of the 1912 Wealth and Welfare), formalized the idea that private and social costs can diverge and proposed correcting that gap with a tax — now called the "Pigouvian tax" — the framework underlying most modern environmental and carbon-pricing policy (see Pigouvian Taxation). In 1909 Pigou also wrote an essay favoring land value taxation, read at the time as support for David Lloyd George's 1909 People's Budget; biographers credit Marshall's own writing on land taxation with shaping Pigou's later, more general theory of taxing negative externalities.
Pigou's welfare-economics program — distinguishing "marginal private net product" from "marginal social net product" — gave 20th-century economics its standard vocabulary for market failure and correction, though Ronald Coase later challenged the tax-based remedy by arguing that well-defined property rights and bargaining could resolve many externality problems without government intervention.
See Also
- Pigouvian Taxation — the tax concept named for him, directly descended from his welfare-economics framework
- Alfred Marshall — his teacher and predecessor in the Cambridge chair, whose land-tax writing shaped Pigou's externality theory
- The 1909 People's Budget — the land-value-tax reform Pigou's 1909 essay supported
- Carbon Pricing Cuts Emissions — a modern policy application of the Pigouvian framework
Sources
- Mark Blaug, Economic Theory in Retrospect — used for situating Pigou within the neoclassical welfare-economics tradition and his relationship to Marshall. wiki summary
- "Arthur Cecil Pigou," Wikipedia — used for biographical facts (birth/death dates, the 1908 Cambridge succession, and the 1909 land-value-tax essay). https://en.wikipedia.org/wiki/Arthur_Cecil_Pigou
- A. C. Pigou, The Economics of Welfare (Macmillan, 1920) — the primary source for the externality/Pigouvian-tax framework; used here as the citation this wiki's Pigouvian Taxation page had flagged as missing. Full text, Internet Archive