Jeremy bentham and adam smith on the usury laws: A ‘smithian’ reply to bentham and a new problem

Samuel Hollander

Research output: Contribution to journalArticlepeer-review

30 Scopus citations

Abstract

Adam Smith justified the contemporary usury laws and was severely criticised by Bentham and most modern writers with the important exception of J.M. Keynes. We argue that pace Bentham, Smith did not intend to preclude loan financing of all ‘risky’ ventures and give a ‘monopoly’ to safe investments and did not neglect the potential emergence of black credit markets. Yet Smith ought to have modified his position independently of Bentham's criticism, considering a marked rise in the rate at which governments borrowed in the late 1770s.

Original languageEnglish
Pages (from-to)523-551
Number of pages29
JournalEuropean Journal of the History of Economic Thought
Volume6
Issue number4
DOIs
StatePublished - 1 Jan 1999
Externally publishedYes

Keywords

  • Adam Smith
  • Jeremy Bentham
  • classical economics
  • entrepreneurship
  • risk
  • usury laws

ASJC Scopus subject areas

  • General Arts and Humanities
  • Economics, Econometrics and Finance (miscellaneous)
  • History and Philosophy of Science

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