UUnniivveerrssiittyy ooff MMaassssaacchhuusseettttss AAmmhheerrsstt SScchhoollaarrWWoorrkkss@@UUMMaassss AAmmhheerrsstt Doctoral Dissertations 1896 - February 2014 1-1-2002 PPoolliittiiccaall ccoommmmuunniittyy aanndd iinnddiivviidduuaall ggaaiinn :: AArriissttoottllee,, AAddaamm SSmmiitthh aanndd tthhee pprroobblleemm ooff eexxcchhaannggee.. Kimberly K. Sims University of Massachusetts Amherst Follow this and additional works at: https://scholarworks.umass.edu/dissertations_1 RReeccoommmmeennddeedd CCiittaattiioonn Sims, Kimberly K., "Political community and individual gain : Aristotle, Adam Smith and the problem of exchange." (2002). Doctoral Dissertations 1896 - February 2014. 1999. https://doi.org/10.7275/ezqj-0n21 https://scholarworks.umass.edu/dissertations_1/1999 This Open Access Dissertation is brought to you for free and open access by ScholarWorks@UMass Amherst. It has been accepted for inclusion in Doctoral Dissertations 1896 - February 2014 by an authorized administrator of ScholarWorks@UMass Amherst. For more information, please contact [email protected]. POLITICAL COMMUNITY AND INDIVIDUAL GAIN: ARISTOTLE, ADAM SMITH AND THE PROBLEM OF EXCHANGE A Dissertation Presented by KIMBERLY K. SIMS Submitted to the Graduate School of the University of Massachusetts Amherst in partial fulfillment of the requirements for the degree of DOCTOR OF PHILOSOPHY September 2002 Department of Political Science Digitized by the Internet Archive 2015 in ©Copyright by Kimberly K. Sims 2002 All Rights Reserved https://archive.org/details/politicalcommuniOOsims 1 POLITICAL COMMUNITY AND INDIVIDUAL GAIN* ARISTOTLE, ADAM SMITH AND THE PROBLEM OF EXCHANGE A Dissertation Presented by KIMBERLY K. SIMS Approved as to style and content by: Nicholas Xenos/ Chair Jambs Der Derian, Member fh-j A' . Carlin Barfton, Member repome Mileur, Department Head Political Science ABSTRACT POLITICAL COMMUNITY AND INDIVIDUAL GAIN- ARISTOTLE, ADAM SMITH AND THE PROBLEM OF EXCHANGE SEPTEMBER 2002 KIMBERLY K. SIMS, B.A., UNIVERSITY OF CALIFORNIA LOS ANGELES M A. SAN FRANCISCO STATE UNIVERSITY • , Ph.D., UNIVERSITY OF MASSACHUSETTS AMHERST Directed by: Professor Nicholas Xenos As the central expression of the principle of justice, the idea of exchange has deep roots in the classical Greek constitution of political community. In the writings of Aristotle, the just material transaction is crucial to the constitution of political community. Aristotle's analysis of exchange in the Nichomachean Ethics and the Politics attempts to investigate the ways in which exchange can be rendered in accordance with the principle of justice as an equalizing reciprocity. However, as I show in the first chapter of this work, Aristotle's treatment of exchange in the Ethics does not succeed in creating a formula for equivalency. Nor, in the subsequent attempt to approach the issue of exchange in the Politics, is Aristotle able to decisively separate transgressive and unequal modes of exchange from beneficial and fair ones. In the end, as I argue, IV Aristotle has discovered an aporia pointing to the fundamental ambiguity of exchange - one which points, moreover, to a troubling ambiguity with regard to the nature of the bonds maintaining the polis. The second chapter explores Mercantilist and Physiocratic attempts to solves the problem of the excessive remainder of exchange. The resolution of Aristotle’s aporia, as I argue in the third chapter, is found in the Adam Smith's Wealth of Nations. Smith's epochal work endures less for its formal analytical contributions than for the ideological content it offers to market economics. My argument is, in essence, that the ideological portion of the Wealth of Nations is premised on a characterization of exchange as qualitative and distributive. This positing of exchange effects a turn on the Aristotelian treatment of beneficial and/or non-transgressive exchange forms in order to repress the quantitative issue of exchange- value and the attendant issue of individual profit. The suspension of quantitativity is not only necessary — to the supression of profit but serves to formulate a new characterization of exchange in which the exchange transaction as disassociated from the trappings of quantitativity now becomes a source for ideological or "meta-economic" appropriations. v PREFACE Material exchange presents a problem to theory. Because exchange does not and can not effect a precise - substitution similitude of objects transacted would wholly negate the need for the activity - an essential dissimilitude between exchangeable objects is reguisite to any transaction. In the literature of the classical Greeks, two competing representations of material exchange evince this difficulty. In some instances, the concept of economic exchange is cast as necessary, natural and mutual, performing the reciprocal function of provisioning and distributing goods. In a second sense, exchange is presented as an adventitious phenomenon which produces unfair gain -- and as such, is a subversion of the bonds necessary to political community. The goal of this inquiry is to trace the reverberations and implications of this classical problem in the modern epoch; an epoch marked by the transmogrification, both formally and ideologically, of the paradox of exchange. vi . TABLE OF CONTENTS ABSTRACT. iv PREFACE. vi CHAPTER INTRODUCTION .1 I. THE PROBLEM OF EXCHANGE IN CLASSICAL GREEK 17 A. Aristotle: The Nichomachean Ethics B. Aristotle: The Politics ^ ^ 17 C. Exchange and Political Community 37 49 II. EARLY MODERN APPROACHES TO THE PROBLEM OF EXCHANGE 57 AB.. MTehrecaEnctliilpissem:ofExExcchhaannggee:andThAebsPohlyustieocrAadtvsantage .. 57 66 III. ADAM SMITH AND THE TRANSMOGRIFICATION OF EXCHANGE A. Production and "Universal Opulence": The Division of Labor g9 B. Exchange: "Of the Principle Which Gives Occasion to the Division of Labor" 97 C. Barter and the Labor Theory of Value 109 IV. REVERBERATIONS AND ACCESSMENTS 120 A. Barter: "Need," Use and Ambiguity 120 B. The "Adam Smith Problem" 124 C. Conclusion BIBLIOGRAPHY 140 ) . INTRODUCTION mTaon.e.x.chdaindgetakgeoldnofporrofsiitlvefrr,om• msaokitnhagt no such exchange. Chaucer beherielluisstrnaottehdinbgywphhiiclhosroepqhuyiretshanmore to trade. Samuel Johnson The concept of exchange has roots in the classical Greek idea of justice, dike, a harmonious association m which the law of measure is observed or enacted. As a law of measure, dike provides a corrective which counters disorder, a corrective enacted through reparation. 1 According to the cosmology of Anaximander, nature functions as a self-regulating equilibrium, and the settlement of justice entails compensation through which the naturally opposed elements stoicheia are required to make reparations ( {dike) to one another for their transgressions of the order of the kosmos as they engage the process of 1 On early forms of Greek justice see Eric Havelock, The Greek Concept of Justice From Its Shadow in Homer : To Its Substance in Plato (Cambridge: Harvard University Press, 1978) 1