Editing Underconsumption (section)

=== 19th century ===
Malthus devoted a chapter of ''Principles'' (1836) to underconsumption theory, which was rebutted by [[David Ricardo]], in his ''Notes on Malthus,'' and which debate continued in private correspondence.<ref>Maclachlan, Fiona C. (Fiona Cameron), [http://muse.jhu.edu/login?uri=/journals/history_of_political_economy/v031/31.3maclachlan.html The Ricardo-Malthus Debate on Underconsumption: A Case Study in Economic Conversation] {{Webarchive|url=https://web.archive.org/web/20160304091539/http://muse.jhu.edu/login?uri=%2Fjournals%2Fhistory_of_political_economy%2Fv031%2F31.3maclachlan.html |date=2016-03-04 }}, History of Political Economy - Volume 31, Number 3, Fall 1999, pp. 563-574.</ref>

Malthus was credited by Keynes as a predecessor for his views on [[effective demand]]<ref>Keynes, Essays in Biography, 1933, p. 103.</ref> and, other than Malthus, Keynes did not credit the existence of other proponents of underconsumption, stating instead that Ricardo "conquered" English economics.<ref>Keynes, General Theory, 1936, p. 32.</ref> This is now understood to be false – other British proponents of underconsumption are now well-established, but, as Keynes demonstrated, they were poorly documented, and by the 1930s not well-known. Further, they did not form a unified school, but rather related heterodox ideas.<ref>{{Cite journal| doi = 10.2307/2229348| journal = The Economic Journal| year = 1967| volume = 77| jstor = 2229348| issue = 305| title = Parson Malthus, the General and the Captain | first = R. D. C.| last1 = Black| pages = 59–74}}</ref>

The [[Birmingham School (economics)|Birmingham School]] of economists argued an underconsumptionist theory from 1815,<ref>{{Cite journal|last=Checkland|first=S. G.|title=The Birmingham Economists, 1815-1850|journal=The Economic History Review|volume=1|issue=1|year=1948|publisher=Blackwell Publishing on behalf of the Economic History Society|jstor=2590000|pages=1–19|doi=10.2307/2590000}}</ref> and some of the writings of the school's leading member [[Thomas Attwood (economist)|Thomas Attwood]] contained formulations of the [[multiplier (economics)|multiplier]] effect and an [[income-expenditure model]].<ref>{{Cite book|last=Glasner|first=David|year=1997|contribution=Attwood, Thomas (1783-1856)|contribution-url=https://books.google.com/books?id=e1ZEPd_pQnoC&pg=PA22|editor-last=Glasner|editor-first=David|title=Business Cycles and Depressions: An Encyclopedia|publisher=Taylor & Francis|page=22|isbn=0-8240-0944-4|url=https://books.google.com/books?id=e1ZEPd_pQnoC|access-date=2009-06-15}}</ref>

In continental Europe, [[Jean Charles Léonard de Sismondi]] proposed underconsumption and overproduction as causes of the [[economic cycle]], in his ''Nouveaux Principes d'économie politique'' (1819), in one of the earliest systematic treatments of economic cycles. Properly, Sismondi discussed periodic [[economic crisis|economic ''crises'']], while the notion of a ''cycle'' was devised by [[Charles Dunoyer]] in his reconciliation of Sismondi's work with classical economics.

The [[multiplier (economics)|multiplier]] dates to work in the 1890s by the Australian economist Alfred De Lissa, the Danish politician [[Julius Wulff]], and the German-American economist [[Nicholas Johannsen]],<ref>[https://archive.org/details/originsofkeynes00dima/page/117 The origins of the Keynesian revolution], by Robert William Dimand, [https://archive.org/details/originsofkeynes00dima/page/117 p. 117]</ref><ref>Johannsen is cited in a footnote in: {{Cite book|title=[[A Treatise on Money]]|last=Keynes|first=John Maynard|date=1930|pages=90|author-link=John Maynard Keynes}}</ref> Nicholas Johannsen also proposed a theory of effective demand in the 1890s.

The [[paradox of thrift]] was stated in 1892 by [[J. M. Robertson|John M. Robertson]] in his ''The Fallacy of Savings,'' and similar sentiments date to antiquity,<ref name="neglect">{{cite journal
|title=A Neglected Early Statement the Paradox of Thrift
|first1=Robert T.
|last1=Nash
|first2=William P.
|last2=Gramm
|journal=History of Political Economy
|year=1969
|volume=1
|issue=2
|pages=395–400
|url=http://hope.dukejournals.org/cgi/pdf_extract/1/2/395
|doi=10.1215/00182702-1-2-395
|url-access=subscription
}}</ref><ref>{{cite book
|first=John M.
|last=Robertson
|author-link=J. M. Robertson
|title=The Fallacy of Saving
|year=1892
|url=https://archive.org/stream/fallacyofsavings00robe/fallacyofsavings00robe_djvu.txt
}}</ref> in addition to the mercantilist statements cited above:
{{Blockquote|There is that scattereth, and yet increaseth; and there is that withholdeth more than is meet, but it tendeth to poverty.<br/>
The liberal soul shall be made fat: and he that watereth shall be watered also himself.
|[[s:Bible (King James)/Proverbs#11:24|Proverbs 11:24–25]]}}