Hobson, John Atkinson

Hobson, John Atkinson (1858-1940), English social reformer and economist, associated with the underconsumption theory that states that unequal incomes cause a decline in economy. Born in Derby, Hobson was educated at Lincoln College, University of Oxford. From 1887 to 1897 he was an extension lecturer at the University of Oxford and at universities in London. Thereafter, Hobson devoted himself exclusively to writing. He was associated with numerous periodicals, including The Speaker and its successor The Nation, and contributed regularly to the Manchester Guardian.

Hobson was primarily a social reformer who became an economist to seek a solution to the problem of poverty. He believed that the purpose of economics, in conjunction with other social sciences, was to discover ways of improving distribution of income so as to increase the general welfare. His social ideas were influenced by John Ruskin, and he emphasized human values rather than the values of the marketplace. He supported the underconsumption explanation of the business cycle, and argued that an excessively unequal distribution of income made capitalism inherently restrictive and unstable. This in turn led to a rate of saving that could be sustained only if surplus capital could be invested on an ever-increasing scale in less developed parts of the world. Hobson believed that if this process were in any way interrupted, there would be crises in the more advanced countries.

Hobson's books ranged over a variety of topics from imperialism to the reform of the tax system, and they provided inspiration for other reformers of his time. His works include The Industrial System (1909), Work and Wealth (1914), Free Thought in the Social Sciences (1926), and Confessions of an Economic Heretic (1938).