Arsène Jules Étienne Juvenal Dupuit (1804–1866), usually subscribed J. Dupuit, was a French civil engineer and economist; he is known today chiefly for his development of the concept later termed “consumer’s surplus.”
Dupuit was born in Fossano, in the Piedmont, and moved with his family to France in 1814. He studied at the collèges of Versailles, Louis le Grand, and Saint Louis, at the école Poly technique, and at the Ecole des Ponts et Chaussées. After serving in the Corps des Ponts et Chaussees in various outlying departments, he became chief engineer for the city of Paris in 1850 and, later, inspector-general of the Corps des Ponts et Chaussées.
Early in his career he became interested in the problem of determining under what conditions the construction of bridges or other public works could be justified, becoming probably the first person to pursue what is now known as cost—benefit analysis on a rigorous basis. In the course of this analysis he developed the concept that the benefits are to be measured not by what is actually paid but by the amount that might be paid under conditions of perfect discrimination—as measured by the area under the demand curve. He seems to have developed the concept of the demand curve independently of Cournot. [See the biography ofcournot.] His measure of the “utility” of a facility was the excess of the benefits so measured over the costs or tolls paid by the user, later called “consumer’s surplus” by Marshall.
Dupuit was highly critical of attempts to justify public works by reference to vague “secondary benefits”; he reiterated that “II n’y a d’utilite que celle qu’on consent a payer,” by which he meant that unless a benefit is somehow reflected in the demand curve, it is illusory. He was undoubtedly correct in his criticism of the double counting often found in justifications for some of the more grandiose schemes of his contemporaries. His formulation did, however, exclude “neighborhood effects” from his evaluation, which would be justifiable either on the ground that they were, in this context, negligible, or that they could, in principle, be charged for, even though not includable in the usual type of demand curve.
These concepts were first published in 1844 in “De la mesure de I’utilite des travaux publics” ([1844–1854] 1933, pp. 29–65) and in 1849 elabo-rated in “De l’influence des peages sur 1’utilité des voies de communication” (ibid., pp. 97–162) and in 1853 in “De I’utilite et de sa mesure” (ibid., pp. 165–181). This last was apparently prepared as an article for Coquelin and Guillaumin’s Dictionnaire d’economie politique (1852–1853), which included articles by Dupuit on “Eau,” “Poids et mesures,” “Ponts et chaussees,” “Routes et chemins,” “Voies de communication,” and an article on “Peage,” which contains cross references to an omitted article on “Utilite””; it is somewhat ironical that this article, which contains the ideas for which Dupuit is best remembered, was omitted in favor of a relatively conventional one by H. Passy.
Beginning about 1850 Dupuit became increasingly interested in economics, and his name, which had since 1838 been appearing fairly regularly as contributor to the Annales des ponts et chaussees, began appearing in the Journal des économistes, while his engineering articles became less frequent. Dupuit became an ardent advocate of laissez-faire. He wrote a vigorous tract, “La liberte commerciale,” in defense of free trade, which was published in parts in the Revue européenne in 1860 and as a separate volume in 1861. He was a staunch Malthusian, arguing that standards of living were observably higher in areas with low density of population and low rates of population growth and even going so far as to condemn charitable distributions in times of famine on the ground that while the direct objects of charity were helped, such activi-ties, since they would drive up food prices, would be primarily at the expense of the nourishment of the remaining poor classes.
True to his engineering background, however, Dupuit remained essentially a pragmatist. He did not let his antagonism toward government interference in general inhibit his recognition that in the case of natural monopolies a government would be likely to set a price more conducive to economical utilization of the facility than would a private monopoly. He did not go so far as to advocate pricing at marginal cost, as A. P. Lerner and Harold Hotelling later did, and indeed at points he seems to suggest that on occasion private enterprise, since it has greater incentive to ferret out more profitable schemes of discrimination, might produce a better utilization of the facility than would a government agency. He vigorously attacked the natural law theory of property rights, asserting that the particular forms that property rights took, particularly in relation to mineral rights and the rights of authors and inventors, were the result of man-made law that could and should decide in favor of those forms of property tenure that would be most conducive to economic efficiency. While he was reluctant, in many cases, to specify in detail what pattern of property rights this principle called for, he did indicate that patents should have a shorter term than copyrights and that discoverers of minerals should have some (not very clearly indicated) rights vis-a-vis the landlord. On the other hand, he considered that property rights legitimized by con-tract or created by government sanction must be respected, even if such rights were plainly of a sort leading to inefficiency and even if the contract was only implicit. Postmasters, having enjoyed the right to a toll on all traffic over their route whether or not the post relay facilities were used, could not be deprived of this right without compensation; on the other hand, their claim to a similar toll on the growing traffic on parallel railroads should not be allowed. Unlimited freedom of contract was not, however, desirable in all cases; in particular, freedom of bequest was undesirable in that parents should not be allowed to bring children into the world and then disinherit them and cause them to become a burden to the rest of the community. Indeed, Dupuit at one point suggested that parents of uneducated children should be required to pay a special tax. Dupuit’s pragmatism showed itself again in his attitude toward the tobacco tax; while he regarded this tax as essentially unjust in singling out a particular taste for a special burden, and doubly so in that the grades consumed by the poor were taxed most heavily, ad valorem, the tax was nevertheless a good one in that it did not impair productivity.
During his later years Dupuit was an active member of the Societe d’ficonomie Politique, and he often engaged in vigorous disputation at its meetings. He argued that economics was attaining the status of a science, by which he meant that there was a growing body of universally accepted principles, a penumbra of matters still under debate and investigation, and a vast domain of unexplored matters. He regarded free trade as one of the universally accepted principles and went so far as to take editor Henri Baudrillat to task (1863) for stooping to include in the Journal des economistes such “unscientific” articles as the review by R. de Fontenay of a French translation of Henry Carey’s Principles of Social Science, in which free trade and Malthusian doctrines were strongly attacked. On other occasions he spoke out vigorously against controls over banks and dealers in foreign exchange, against licensing of doctors, against the promotion of workers’ cooperatives and labor unions, against child labor laws, government crop predictions, and property transfer taxes. While he felt that woman’s place is in the home, he opposed legal barriers to the employment of women that existed in certain occupations. However, he expressed himself in favor of government ownership of railroads. He considered the premature redemption of bonds as inequitable if not clearly provided for in the indenture and preferred that government bonds take the form of nonredeemable perpetuals or “consols,” arguing that to provide explicitly for redemption was unduly costly. He objected to the state monopoly of education, holding that it made it impossible to teach economic doctrines that im-plied criticism of state action, and he felt, moreover, that too much time is wasted in higher education as compared with apprenticeship.
Dupuit was no less a center of controversy in his engineering role. In 1842 he published the results of a series of experiments on friction in wagon wheels, in which he came to the conclusion, backed by theoretical analysis, that the rolling component of the friction varied inversely as the square root of the radius of the wheel, contradicting both the relation inherited from the eminent Coulomb and the empirical work of his contemporaries, who claimed the component varied inversely as the radius itself. Over the next decade he actively advocated more liberal traffic rules, particularly those relating to maximum loads on vehicles, on the basis that road maintenance, consisting in those days mainly in the replacement of material ground into dust by passing traffic, varied very nearly in proportion to the gross weight of the traffic and hence that heavy vehicles would not be uneconomical for the nation as a whole if they were profitable to the operator. This effort met with only limited success. In 1850 he published the results of an investigation of the collapse of a suspension bridge at Angers. During the crossing of an army detachment in a heavy storm, 226 lives were lost; Dupuit blamed the failure on the ineffectiveness of measures taken to protect the suspension cables from rust as they passed through the anchorages, which were subject to flooding. Since the same methods had been fairly widely used elsewhere, his findings were attacked with some vigor.
With regard to his economic activities, it is his work on utility and consumer’s surplus that constitutes his lasting contribution. While there is no mention of Dupuit in the first edition of Jevons’ Theory of Political Economy (1871), the second edition contains an extensive discussion of Dupuit’s contribution in the preface, and full references in the bibliographical appendix. That Jevons highly respected Dupuit’s contribution is shown further by the extensive comments interpolated by H. S. Jevons from his father’s manuscript notes in the bibliographical appendix for the fourth edition. Maffeo Pantaleoni refers frequently to Dupuit in his Principles of Pure Economy, but he is concerned primarily with the concept of utility as an element of value theory and makes little prescriptive use of Dupuit’s concepts. Marshall also refers to Dupuit but indicates that both he and Jevons originally arrived at their own formulations independently of Dupuit. And while Marshall does discuss the possibility that it might be desirable to subsidize de-creasing cost industries, his exposition lacks the incisiveness of that of Dupuit. It remained for Pigou in 1912 in his Wealth and Welfare and in 1920 in his Economics of Welfare to elaborate the prescriptions to which Dupuit pointed. Pigou, however, does not refer to Dupuit as a source, nor do most of the writers on the theme of marginal cost pricing or subsidy to decreasing cost industries throughout the 1920s and 1930s until Hotelling, in 1938, possibly stimulated by the republication of Dupuit’s salient works by Mario de Bernardi in 1933, based his mathematical analysis of the case for marginal cost pricing squarely on Dupuit as a precursor. Thus, although Dupuit must clearly be given priority in the formulation of some of the fundamental concepts of modern welfare economics, his work appears to have had singularly little actual influence on the way economic thought developed over the next century.
William S. Vickrey
1842 Mémoire sur le tirage des voitures et sur le frottement de roulement. Annales des ponts et chaussees Part 2 3:261–335.
(1844–1854) 1933 De lutilité et de sa mesure: Ecrits choisis et republics par Mario de Bernardi. Turin (Italy): La Riforma Sociale. → Contains a bibliography of Dupuit’s works.
1850 Rapport de la commission d’enquéte nominée … pour rechercher les causes et les circonstances qui ont amene la chute du pont suspendu de la Basse-Chaine. Annales des ponts et chaussées Part 2 20:394–411.
(1860) 1861 La liberté cornmerciale: Son principe et ses conséquences. Paris: Guillaumin.
1863 Réponse de M. Dupuit à M. Baudrillat au sujet de l’article “L’économie est elle une science ou une etude?” Journal des economistes Series 2 37:474–482.
Coquelin, Charles; and Guillaumin, Gilbert U. (editors) (1852–1853) 1874 Dictionnaire d’économie politique. 2 vols. Paris: Guillaumin.
Hotelling, Harold 1938 The General Welfare in Relation to Problems of Taxation and of Railway and Utility Rates. Econometrica 6:242–269.
Jevons, William S. (1871) 1965 The Theory of Political Economy. 5th ed. New York: Kelley. → Pages xi-iii contain the “Preface” to the second edition by Jevons.