Jean Charles Léonard Simonde de Sismondi (1773–1842)

Swiss economist and historian; founder and representative of economic romanticism.

Sismondi was born on May 9, 1773, in Geneva, into a Protestant clergyman’s family. He later moved to France, where he went to university in Paris. In 1789, Sismondi worked as a clerk in a bank in Lyon. In 1794, he and his family ran a farm in Tuscany, and he began to study economic theory. In 1800, he returned to his hometown Geneva, where he engaged in in the study of economics and history, and became a renowned economist and historian. In 1803, Sismondi published his first economic work De la richesse commerciale (On Commercial Wealth), which propagated Smith’s doctrine. In 1818, when the editorial board of the Edinburgh Encyclopædia invited him to write the entry “Political Economy” for the encyclopedia, he began to study political economy again. From 1808 to 1818, Sismondi published his historical work History of the Italian Republics in the Middle Ages, which regarded the free cities of medieval Italy as the origin of modern Europe and pushed for the unification of Italy. In 1819, he published Nouveaux principes d'économie politique (New Principles of Political Economy), a book in which he began to oppose Smith’s plea for laissez-faire, advocated moderated competition and a balance between production and marketing, and attempted to transform the world and political economy with the petty-bourgeois world outlook, which marked his shift from a believer in classical English political economy to a fierce opponent of it. From 1837 to 1838, he published the two-volume collection, Études sur l'économie politique (Studies on Political Economy), which proved the theory he had put forth in his Nouveaux principes d'économie politique with a large number of historical and practical materials.

Nouveaux principes d'économie politique is Sismondi’s representative work. He criticized the popular view that the purpose of political economy is to increase national wealth, and criticized the fundamental error of classical English economics in treating means as ends and forgetting about man, holding that that wealth is only a means to make people materially happy, and that the hallmark of prosperity of a nation lies in the ratio of wealth to population, not in the increase of wealth itself. In the book, Sismondi analyzed the contradiction between production and consumption in capitalist society and was the first to deal with the inevitability of the economic crisis of capitalist overproduction, but he attributed the cause of the crisis to the underconsumption of the means of subsistence, which was obviously one-sided. Sismondi held that medieval patriarchal agriculture and guilds for manufacture were the best mode of production, and that the only way to eliminate the contradictions of capitalism was to revert to the idealized mode of petty production. He therefore called on the state to take measures to bring about a patriarchal cooperative relationship between capitalists and workers in order to seek equality in the distribution of wealth and to achieve universal social welfare. For this reason, he is also known as the founder of economic romanticism.

Sismondi’s analysis of capitalist economic crisis had an important impact on Marx’s theory of economic crisis. However, Sismondi did not understand the nature and root cause of the fundamental contradictions of capitalism. He did not understand the objective laws of development of capitalism, and he erroneously attributed the inner contradictions of capitalism to people's thoughts, erroneous economic doctrines and the economic policies of the state, and subjectively and utopistically searched for general principles and political measures to ensure the material well-being of mankind, founding the petit-bourgeois socialist ideological system (or “ideological system of economic romanticism”). In The Communist Manifesto, Marx and Engels criticized this petty-bourgeois socialism represented by Sismondi. Marx and Engels pointed out that this form of socialism aspires either to restoring the old means of production and of exchange, and with them the old property relations, and the old society, or to cramping the modern means of production and of exchange within the framework of the old property relations that have been, and were bound to be, exploded by those means. In either case, it is both reactionary and utopian.

In 1842, the French government awarded Sismondi with the Legion of Honor. On June 25, 1842, he died in Chêne, near Geneva.