John Ramsay McCulloch - Career

Career

McCulloch attended the University of Edinburgh, but did not graduate.

McCulloch collected the early literature of political economy, and wrote on the scope and method of economics and the history of economic thought. After his death his library was purchased by Lord Overstone and eventually presented to the University of Reading. He was a participant in the Political Economy Club, London, founded by James Mill and a circle of friends in 1821 for an ongoing discussion of the fundamental principles of political economy.

McCulloch's works include a textbook, Principles of Political Economy (Edinburgh 1825). He worked on subsequent editions until his death. This book contains a memorable discussion of the origins of profit or interest in the case of a cask of new wine.

"Suppose that a cask of new wine, which cost £50, is put into a cellar, and that, at the end of twelve months, it is worth £55, the question is: Should the £5 of additional value, given to the wine, be considered as a compensation for the time the £50 worth of capital has been locked up, or should it be considered as the value of additional labour actually laid out in the wine?"

This question is still used in discussions of the labor theory of value and related issues. McCulloch used it to illustrate that "time cannot of itself produce effect; it merely affords space for really efficient causes to operate, and it is therefore clear it can have nothing to do with value." Reflecting on discussions in the Political Economy Club, Ricardo had privately expressed his famous opinion about the "non-existence of any measure of absolute value."

McCulloch died in 1864, and is buried in Brompton Cemetery, London.