Part 6 — Section 14. See "The Metaphysics of the Telephone Exchange," "System of Metaphysics," Chapter XXII, where Professor Pearson's doctrine is examined at length, with quotations and references.
Reading edition
It is interesting to notice that a doubt of the external world has always rested upon some sort of a "telephone exchange" argument; naturally, it could not pass by that name before the invention of the telephone, but the reasoning is the same. It puts the world at one remove, shutting the mind up to the circle of its ideas; and then it doubts or denies the world, or, at least, holds that its existence must be proved in some roundabout way. Compare Descartes, "Of the Existence of Material Things," "Meditations," VI.