The Economist Launches

Date September 2, 1843

The first weekly newspaper to use statistical tables and mathematical information in support of news stories, The Economist was founded by James Wilson, an ardent free trader and proponent of laissez-faire economics. Wilson and his newspaper became an important voice of those positions both before and after it broadened its focus from financial to political news.

Locale London, England

Key Figures

• James Wilson (1805-1860), founding editor of The Economist, 1843-1860, and later member of Parliament, 1847-1859
• William Rathbone Greg (1809-1881), writer of the lead political articles for The Economist, 1846-1851
• Thomas Hodgskin (1787-1869), writer for The Economist on political economy
• Herbert Spencer (1820-1903), writer and assistant editor of The Economist
• William Newmarch (1820-1882), statistician for The Economist
• Walter Bagehot (1826-1877), son-in-law of Wilson and editor of The Economist, 1860-1877
• Sir Robert Inglis Palgrave (1827-1919), and
• Daniel Latherbury (fl. mid-nineteenth century), editors of The Economist, 1877-1883
• Edward Johnstone (d. 1910), editor of The Economist, 1883-1907

Summary of Event

Born to a Quaker family in Scotland in 1805, James Wilson moved to London as a young man. There he and his brother opened a hat-manufacturing plant that was financed by their father through the sale of a similar business in their hometown of Hawick. Wilson’s business background combined with his wealth to draw him into political circles as early as 1837. Wilson was a supporter of free trade, which stood to expand his hat business, and he opposed the Corn Laws. These positions brought him into the sphere of politician and economic reformer Richard Cobden .

In 1839, Wilson debuted as a writer and an economic thinker with an anti-Corn Law pamphlet, in which he argued that commodity sales would benefit from fewer government restrictions and that the competitive pricing of a free market would, in the long term, stimulate the national economy. Wilson’s theories followed those of his fellow Scotsman Adam Smith. The support of the members of Cobden’s Anti-Corn Law League had a direct effect on the creation and initial success of The Economist.

Wilson was self-taught in economic theory, but his passion for socioeconomics and free trade were evident in the prospectus for a new weekly paper that he circulated in August, 1843. He passion, as well as his position, earned him financial support, and Wilson was able to fund the paper largely through the sponsorship of the third earl of Radnor and Charles Pelham Villiers. On September 2, 1843, the first number of The Economist: Or, The Political, Commercial, and Agricultural, and Free Trade Journal was published by Wilson, who wrote most of the paper himself during his the remainder of his life. In 1934, the lengthy subtitle was dropped, having been changed several times in the intervening seventy years.

The early issues of The Economist contained long essays on free trade and articles of various lengths on domestic and foreign trade issues, actions of the financial markets, parliamentary decisions relevant to trade, ideas for new businesses, and miscellaneous cultural and general news. Each week, Wilson included tables of financial data that supported the free trade views expressed in the news stories. Wilson spent most his time collecting information by attending parliamentary hearings and writing for his own paper as well as for The Manchester Guardian, to which he contributed a weekly column on finance from 1843 to 1853. During the early years of The Economist, Wilson still maintained and operated his hat business as well.

The Economist was successful from the start. While maintaining a steady stream of news and editorials on free trade, political economy—that is, a system in which resources are used to support the economy of a nation—and laissez-faire economics, Wilson hired journalists able to expand the readership of the paper through leads that drew attention to matters related to the economy, such as the Irish famine and capital punishment. Chief among these journalists were Thomas Hodgskin, who wrote on political economy following the principles of English philosophers John Locke and John Stuart Mill; Herbert Spencer , an advocate of humanist approaches to the use of statistics in political and social debates; and William Rathbone Greg , who joined the staff in 1846, having made a name for himself with Wilson as a writer on the situation in Ireland and general foreign affairs.

Of these early writers for The Economist, Spencer became the most famous in the years after he left the newspaper, joining the circle of novelist George Eliot and publishing theories of evolution that preceded in print those of Charles Darwin. Greg brought Walter Bagehot into The Economist’s environment when the banker-historian agreed to fund Greg’s own fledgling newspaper in 1854. The paper failed, but Bagehot, through Greg, met the Wilson family and married Wilson’s eldest daughter Eliza. In 1860, when Wilson died while in Calcutta serving as the queen’s representative on finance to the Council on India, the Bagehots assumed ownership and editorial control of the newspaper.

Under Bagehot, The Economist retained its commitment to the use of statistics and financial tables as news. Bagehot, in fact, had been a reader of the paper from at least 1847, and he was familiar with its principles and goals. He shared with Wilson the desire to spread easy-to-understand, useful financial news to the public and through the government. Like Wilson, Bagehot favored common sense and clarity in journalistic prose, and he solidified the reputation of The Economist through his own reputation as a banker and journalist, as well as through important additions to the staff—including William Newmarch, who, as a professional statistician, transformed the application of statistics to the news.

In 1877, Bagehot died, and ownership of the paper passed to his widow. The new editors, Sir Robert Inglis Palgrave and Daniel Latherbury, decided to change the focus of the newspaper to political news. During their editorial tenure (1877-1883), the paper benefited from the lead articles on Irish Home Rule provided by H. H. Asquith, articles that were not always in agreement with the actions of Prime MinisterWilliam Ewart Gladstone. The addition in 1885 of John St. Loe Stratchey advanced Latherbury’s agenda, as he felt hampered by the paper’s emphasis on finance. The last of The Economist’s nineteenth century editors, Edward Johnstone, had worked at the newspaper with Palgrave and Latherbury. He returned the focus of The Economist to finance, and the major items covered during his tenure were banking scandals and insurance fraud. He stepped down as editor in 1907 because of ill health.

Significance

The Economist’s significance resided in its status as the first weekly news journal to use statistical information in support of news analysis and reportage. Wilson simultaneously popularized statistical data and demonstrated the importance of such information to argumentation. Under his leadership from 1843 to 1860, The Economist supported laissez-faire economics, free trade, and the idea of political economy, but all at the discretion of the individual. Wilson opposed the restrictive policies of the Corn Laws and capital punishment, and he became a leading voice in social reform for Ireland through his articles on the economic impact of the Great Irish Famine of 1845-1854.

Wilson also used The Economist as a tool for debating the financial ramifications of political decisions, such as the engagement of Britain in the Crimean War (1853-1856) and the various currency debates of the 1850’s. He maintained that it was business, especially monetary policies, that made a nation successful and that the economy thrived under free competition, not price and trade controls. He articulated his ideas on the importance of personal wealth to national wealth in his articles for The Economist, and he used financial data, not political philosophy or idealism, to support his claims.

Throughout the latter half of the nineteenth century, The Economist rivaled other news organs, including The Times of London and The Spectator. Likewise, many of the writers for The Economist launched or solidified their public careers while on Wilson’s staff. These included Herbert Spencer, Walter Bagehot, and Thomas Hodgskin, who all profited from their affiliation with the pragmatic yet creative James Wilson.

Bibliography

Angell, Patrick. “The Economist.” In Consumer Magazines of the British Isles, edited by Sam Reilly. Westport, Conn.: Greenwood Press, 1993. A short article that summarizes the history of the periodical, with an emphasis on its twentieth century history.

Barzun, Jacques. “Bagehot as Historian.” In A Jacques Barzun Reader, edited and with an introduction by Michael Murray. New York: HarperCollins, 2002. Studies Bagehot’s career as a political historian and his affiliation with Locke’s idea that property was key to economic stability.

The Economist, 1843-1943: A Centenary Volume. Oxford, England: Oxford University Press, 1943. A compilation of representative articles from the paper’s first one hundred years.

Edwards, Ruth Dudley. The Pursuit of Reason: The Economist, 1843-1943. London: Hamish Hamilton, 1993. The only comprehensive history of The Economist.

McCann, Charles R. Individualism and the Social Order: The Social Element in Liberal Thought. London: Routledge, 2004. Analyzes the role of community and society in the social thought of Spencer and other liberal philosophers of the nineteenth and twentieth centuries.