W.E. Hearn on the Industrial Organisation of Society

Analysis of Hearn's approach to industrial localisation shows that he anticipated with unusual acuteness some issues also addressed by contemporary debate on the cause of the rise and competitiveness of firms' conglomerations. One of the main themes of Plutology is analysis of efficiency and the different ways in which it may be promoted. Consistently with such an approach, Hearn placed special emphasis on the role of those economies which arise from the internal organisation and management and those that depend on localisation. In treating this latter point he developed the concept of industrial district and its role in introducing innovations, firm's specialisation in different industries, and the promotion of that specific milieu which Marshall later defined 'industrial atmosphere'. Moreover, both authors viewed the inner dynamism of capitalism as based not merely on the satisfaction of given needs, but on the promotion of new wants and in the corresponding emergence of new 'activities' and 'efforts'. The elements collected in this paper - with a special view to Hearn's analysis of the industrial district - provide further evidence for Groenewegen's claim that he "was a more important influence [on Marshall] than now tends to be acknowledged" and may induce us partially to revise the consolidated opinion that Hearn's role in the history of economic thought was merely that of an obscure forerunner of the marginal revolution.