Anthony J. Pennings, PhD


The Smith Effect II: From Political Arithmetik to “State-istics” to IT

Posted on | September 6, 2010 | No Comments

This is the second in a five part exploration of Adam Smith and how his ideas laid the foundation for information technology (IT).

In the Smith Effect I the argument is made that Adam Smith’s writings contributed to a set of intellectual movements that located a nation’s wealth in its population rather than the familial structure of the monarch and its treasury. Drawing on Michael J. Shapiro‘s Reading “Adam Smith” (2002), I argue that this reconceptualization created a trajectory for the development of new information practices and technologies. Not only did Smith’s writings contribute to an understanding of “market forces” and the importance of labor, but the new emphasis on the population for a nation’s wealth provided the intellectual foundation for a transformation of the census, an ancient political tool, into a wide field of measurements that came to be called statistics (“state-istics”), the science of numbers in service of governing the nation-state. This turn led directly to the creation of information machines, and ultimately electronic computers. The Smith Effect therefore provides a unique opportunity for analyzing the roots of modern society’s reliance on information technology (IT) and how these tools and practices have been integrated into a wide array of corporate and governmental bureaucracies.

Written about the time of America’s revolution, Smith’s ideas became the foundation of economic thought in the West and a major contributor of the characterization of the modern state and its role in the liberalization of the political economy. Reflecting the preoccupation of the time, Smith’s point of departure for his analysis of the economy was sovereignty. But rather than negate it, he reconfigured it. The authority of the state was no longer seen simply concerned with the maintenance of a ruling power, but also with its productive capabilities and with the wealth of a realm’s inhabitants. Sovereign power was increasingly seen as a steering mechanism that could guide the flows and collaborations of social activities towards increasing the overall wealth for the nation. The energies of the population could be mobilized in a way that takes advantage of the social propensities to barter, exchange and accumulate. In Smith’s wake, governmental bureaucracy expands and takes on increasing demands in terms of textualizing, aggregating, and interpreting information about the economy and the population which was beginning to be considered such an integral component of the nation’s wealth.

The origins of this new field of governmental calculation were first articulated in a chapter of the German Baron J. F. Bielfeld‘s Elements of Erudition in 1787. Entitled “Statistics”, it announced the endeavor as the “science that teaches us what is the political arrangement of all the modern states of the known world”. Bielfeld discussed the emergence of the field in Germany and its objective to chronicle the “noteworthy characteristics of the state” and to analyze the major powers in the world, including their citizens, industries, and governmental decisions. [1]

While initially concerned with categorization and verbal descriptions, by the beginning of the next century these descriptions are largely replaced by numerical data and calculation. This new enthusiasm for calculation led to the publication of a number of books and the participation of many “societies” in the task of producing lists of numbers. By the time of Charles Babbage, generally considered the father of computing, numbers had become a major preoccupation. Babbage himself published a book in 1832 urging the publication of more books on numeral constants. “Babbage had twenty kinds of numbers to be listed. They begin with familiar enough; material, astronomy, atomic weights, specific heats and so forth. They quickly pass to the number of feet of oak a man can saw in an hour, the productive powers of men, horses, camels, and steam engines compared, the relative weights of the bones of various species, the relative frequency of occurrence of letters in various languages.” With this new fascination with numerical calculation, statistics goes beyond just the calculation of government revenues and assets to be used in a wider range of societal and political computations. [2]

This “avalanche” of algebraic numerals diffused calculative and listing capabilities throughout a number of domains. As bureaucracy was in its infancy, it was initially more pronounced in the universities and societies, in areas such as epidemiology, genetics and political economy. World statistical organizations convened such as the Manchester Statistical Society and the Statistical Society of London which included such members as Thomas Malthus, generally considered the father of the “dismal science” of economics. Dialogues on statistics were from their earliest beginnings, a politically charged discourses. Of great importance to the members of these societies was “the condition of the people”, as statistics became an important part of the social reform movements that accompanied the trials of industrialization. [3]

Calculations take a new turn in the wake of Smith’s contribution. The use of “political arithmetic” for the mercantile state had a long history in the area of taxation and finances as it concerned itself with the internal affairs of the state and the monitoring of wealth extracted from its empire. During the nineteenth and twentieth centuries, however, the state turned towards registering information on their populations. This includes the “centralized collation of materials registering births, marriages and deaths, statistics pertaining to residence, ethnic background and occupation; and what came to be called by Quetelet and others ‘moral statistics’, relating to suicide, delinquency, divorce and so on.” [4] It also shows in the Belgian census of 1840s, which would go on to become the international model as countries learned from each other the techniques of constructing a numerical representation of its population and also used these numbers to compete for national status. [5]

The new focus on population in the late 18th century led directly to the emergence of a series of knowledges for constructing, reading, and acting upon this problem. Numbering for the state, or “statistics”, emerges as a formative knowledge in the construction of government practices. Bureaucracies expand and officials are put to use in collecting the new information. The comprehension of the population as the new source of national wealth and as the focus of administrative activity called forth new languages, many utilizing alphanumeric figuring. Based on the elevation of the alphanumeric notation system as the quantitative rhetoric of reality (from the old French term real , the space controlled by royalty), statistics develops as a state instrument for social surveying and has consequences for both the constitution of the population, and according to Foucault, new forms of “governmentality,” including the elaboration of political economy as a new discipline of measuring a nation’s wealth.

Statistics provides a new view of the economy and society. No longer could the family serve as a viable model of economic accumulation and social governance. The family instead becomes part of the demographic realm to be studied and calculated. Foucault elaborates:

Whereas statistics had previously worked within the administrative frame and thus in terms of the functioning of sovereignty, it now gradually reveals that population has its own regularities, its own rate of deaths and diseases, its cycle of scarcity, etc.; statistics shows also that the domain of population involves a range of intrinsic, aggregate effects, phenomena that are irreducible to those of the family, such as epidemics, endemic levels of mortality, ascending spirals of labour and wealth; lastly it shows that, through its shifts, customs, activities, etc., population has specific economic effects: statistics, by making it possible to quantify these specific phenomena of population, also shows that this phenomenon is irreducible to the dimension of the family. [6]

By the late nineteenth century, frustration with manual methods of compiling statistics was rising. Despite increasing loads and classification projects; pencils, pens, and rulers were still the main tools for classifying, calculating, and summarizing work sheets into journals and ledgers. The United States started to look for alternatives after running into difficulties tabulating the 1880 census. It was required by the US Constitution to keep a register of the population and was desperately trying to keep up with the large-scale immigration of the late 19th century. The Census Bureau could not keep accurate track of the growth and by 1887 was desperately soliciting ideas to help them complete the 1880 census. The solution would be mechanical and lead to the formation of International Business Machines (IBM)

Preview of the Smith Effect III: The Census and the Rise of IBM

From the eighteen-century, changes start to occur in the way state sovereignty is generally construed. Mercantilism, which did much to apply the new calculating rationality and arts of government for the welfare of the monarchical state, begins to give way to an even broader application of political practices involving the collection and calculation of information. Whereas the instruments of the state under mercantilism worked to increase the wealth of the ruler, the new practices and knowledges of the state paid increasing heed to the newly conceived problem of population. The rigid framework of sovereignty that had been previously modeled on the patriarchal family begins to confront an increasing money supply, new numerical techniques allowing demographical accounting and the expansion of agricultural and goods production.

But it was the American census that provided the most immediate relief for the problems associated with aggregating large amounts of statistical data. Mandated by the US constitution to be held every 10 years, its calculation ran into difficulties as immigration soared in the late 19th century. By 1880, the task was nearly impossible to complete before the next one was due. The solution was the “census machine” and it changed the trajectory of both corporate and governments bureaucracy as well as the information practices that run them.

Anthony J. Pennings, PhD has been on the NYU faculty since 2001teaching digital media, information systems management, and global political economy. He can be reached at

[1] Notes and quotes from Statistics and Society: Data Collection and Interpretation (1991) by Walter Theodore Federer. CRC Press.
[2] Hacking, I. (1991) “How should we do a history of statistics?” in Burchell, G., Gordon, C. and Miller, P. (eds.) The Foucault Effect: Studies in Governmentality. (Chicago: University of Chicago Press). p. 186.
[3] Manicus, P. (1987) A History and Philosophy of the Social Sciences. (Oxford: Basil Blackwell). p. 196 197. See also Poovey, M. (1993) “Figures of Arithematic, Figures of Speech: The Discourse of Statistics in the 1830’s,” CRITICAL INQUIRY. Winter, Vol. 19, No. 2.
[3] Hacking, I. (1991) “How should we do a history of statistics?” in Burchell, G., Gordon, C. and Miller, P. (eds.) The Foucault Effect: Studies in Governmentality. (Chicago: University of Chicago Press). p. 182.
[4] See also Bruce Curtis’ The Politics of Population: State Formation, Statistics, and the Census of of Canada, 1840-1875. (2002) University of Toronto Press.
[5] Foucault, M. (1991) “Governmentality,” in Burchell, G., Gordon, C. and Miller, P. (eds.) The Foucault Effect: Studies in Governmentality. (Chicago: University of Chicago Press). p. 99.


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    Professor and Associate Chair at State University of New York (SUNY) Korea. Recently taught at Hannam University in Daejeon, South Korea. Moved to Austin, Texas in August 2012 to join the Digital Media Management program at St. Edwards University. Spent the previous decade on the faculty at New York University teaching and researching information systems, media economics, and strategic communications.

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