ABSTRACT
The development of the neo-classical theory by the end of the nineteenth century had excluded issues of economic policy and international economic relations from the field of the mainstream economic analysis. The new ‘economic science’ is apolitical and aims to explain the markets’ functioning within the framework of pure and perfect competition. In terms of doctrine, the Liberals advocate for a minimal state and free trade. But the First World War, that broke out in a context of unprecedented economic and financial interdependencies at the world level, raises questions about the liberal optimism regarding the pacification of international relations through economic links. Moreover, the Russian revolution of 1917 enhances the popularity of the Marxist theory, which directly competes with liberalism: it is the return to the ‘political economy’. Some heterodox theories arise out of this very period: as soon as the early twentieth century, Hobson had criticized the imperialist policies of capitalist countries, within a perspective of reform. World War I accelerated the development of another major theoretical critic of capitalism, the one of Veblen, the founding father of institutionalism. The time is right for political debates, in which economists take part. Amongst Marxist economists, disagreements are numerous, in particular concerning the evolution of capitalism.
