Classical economics

classical economistsclassicalclassical economistclassical political economyclassical economicclassical schoolclassical political economistsclassical economic ideasClassic economic theoryclassical economic theory
Classical economics or classical political economy is a school of thought in economics that flourished, primarily in Britain, in the late 18th and early-to-mid 19th century.wikipedia
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David Ricardo

RicardoRicardianDavid Ricardo,MP
Its main thinkers are held to be Adam Smith, Jean-Baptiste Say, David Ricardo, Thomas Robert Malthus, and John Stuart Mill.
David Ricardo (18 April 1772 – 11 September 1823) was a British political economist, one of the most influential of the classical economists along with Thomas Malthus, Adam Smith and James Mill.

Economics

economiceconomisteconomic theory
Classical economics or classical political economy is a school of thought in economics that flourished, primarily in Britain, in the late 18th and early-to-mid 19th century.
On the satirical side, Thomas Carlyle (1849) coined "the dismal science" as an epithet for classical economics, in this context, commonly linked to the pessimistic analysis of Malthus (1798).

The Wealth of Nations

Wealth of NationsAn Inquiry into the Nature and Causes of the Wealth of NationsAdam Smith
Adam Smith's The Wealth of Nations in 1776 is usually considered to mark the beginning of classical economics.
First published in 1776, the book offers one of the world's first collected descriptions of what builds nations' wealth, and is today a fundamental work in classical economics.

Division of labour

division of laborspecializationspecialised
This income was in turn based on the labor of its inhabitants, organized efficiently by the division of labour and the use of accumulated capital, which became one of classical economics' central concepts.
Accordingly many classical economists as well as some mechanical engineers such as Charles Babbage were proponents of division of labour.

John Stuart Mill

MillJ.S. MillJ. S. Mill
Its main thinkers are held to be Adam Smith, Jean-Baptiste Say, David Ricardo, Thomas Robert Malthus, and John Stuart Mill.
In the following year he was introduced to political economy and studied Adam Smith and David Ricardo with his father, ultimately completing their classical economic view of factors of production.

Capital (economics)

capitalcapital flowsinvestment capital
This income was in turn based on the labor of its inhabitants, organized efficiently by the division of labour and the use of accumulated capital, which became one of classical economics' central concepts.
Classical and neoclassical economics regard capital as one of the factors of production (alongside the other factors: land and labour).

Physiocracy

Physiocratsphysiocratphysiocratic
Adam Smith, following the physiocrat François Quesnay, identified the wealth of a nation with the yearly national income, instead of the king's treasury.
It immediately preceded the first modern school, classical economics, which began with the publication of Adam Smith's The Wealth of Nations in 1776.

Mercantilism

mercantilistmercantilemercantilists
In terms of international trade, the classical economists were advocates of free trade, which distinguishes them from their mercantilist predecessors, who advocated protectionism.
In Europe, academic belief in mercantilism began to fade in the late-18th century after the British seize and control of the Mughal Bengal, a major trading nation, and the establishment of the British India through the activities of the East India Company, in light of the arguments of Adam Smith (1723-1790) and of the classical economists.

Keynesian economics

KeynesianKeynesianismKeynesian theory
Other ideas have either disappeared from neoclassical discourse or been replaced by Keynesian economics in the Keynesian Revolution and neoclassical synthesis.
Keynes contrasted his approach to the aggregate supply-focused classical economics that preceded his book.

Market economy

market economiesfree market economymarket
These economists produced a theory of market economies as largely self-regulating systems, governed by natural laws of production and exchange (famously captured by Adam Smith's metaphor of the invisible hand).
Market socialism traces its roots to classical economics and the works of Adam Smith, the Ricardian socialists and mutualist philosophers.

Capitalism

capitalistcapitalistscapitalistic
The classical economists produced their "magnificent dynamics" during a period in which capitalism was emerging from feudalism and in which the Industrial Revolution was leading to vast changes in society.
Smith and other classical economists before Antoine Augustine Cournot were referring to price and non-price rivalry among producers to sell their goods on best terms by bidding of buyers, not necessarily to a large number of sellers nor to a market in final equilibrium.

Steady-state economy

steady-state theoristSteady state economysteady state
This is now known as a steady-state economy.
Early in the history of economic thought, classical economist Adam Smith of the 18th century developed the concept of a stationary state of an economy: Smith believed that any national economy in the world would sooner or later settle in a final state of stationarity.

Economic rent

rentland rentrents
With property rights to land and capital held by individuals, the national income is divided up between labourers, landlords, and capitalists in the form of wages, rent, and interest or profits. Georgists and other modern classical economists and historians such as Michael Hudson argue that a major division between classical and neo-classical economics is the treatment or recognition of economic rent.
In political economy, including physiocracy, classical economics, Georgism, and other schools of economic thought, land is recognized as an inelastic factor of production.

Adam Smith

SmithA SmithAdam Smith’s
Its main thinkers are held to be Adam Smith, Jean-Baptiste Say, David Ricardo, Thomas Robert Malthus, and John Stuart Mill. Adam Smith, following the physiocrat François Quesnay, identified the wealth of a nation with the yearly national income, instead of the king's treasury.

Neoclassical economics

neoclassicalneoclassical economistsneo-classical economics
There is some debate about what is covered by the term classical economics, particularly when dealing with the period from 1830–75, and how classical economics relates to neoclassical economics.
Classical economics, developed in the 18th and 19th centuries, included a value theory and distribution theory.

Luigi Pasinetti

Luigi L. PasinettiL. PasinettiPasinetti
John Hicks & Samuel Hollander, Nicholas Kaldor, Luigi L. Pasinetti, and Paul A. Samuelson have presented formal models as part of their respective interpretations of classical political economy.
In such work Pasinetti presented a very concise and elegant (and pedagogically effective) analysis of the basic aspects of classical economics.

Keynesian Revolution

a revolution in economic thinking
Other ideas have either disappeared from neoclassical discourse or been replaced by Keynesian economics in the Keynesian Revolution and neoclassical synthesis.
The revolution was set against the orthodox classical economic framework, and its successor, neoclassical economics, which, based on Say's Law, argued that unless special conditions prevailed, the free market would naturally establish full employment equilibrium with no need for government intervention.

Say's law

law of marketssupply creates its demandsupply creates its own demand
Sraffians argue that: the wages fund theory; Senior's abstinence theory of interest, which puts the return to capital on the same level as returns to land and labour; the explanation of equilibrium prices by well-behaved supply and demand functions; and Say's law, are not necessary or essential elements of the classical theory of value and distribution.
In classical economics, Say's law, or the law of markets, is the claim that the production of a product creates demand for another product by providing something of value which can be exchanged for that other product.

Price

market pricepricesretail price
William Petty introduced a fundamental distinction between market price and natural price to facilitate the portrayal of regularities in prices.
The paradox of value was observed and debated by classical economists.

Samuel Hollander

Hollander, Samuel
John Hicks & Samuel Hollander, Nicholas Kaldor, Luigi L. Pasinetti, and Paul A. Samuelson have presented formal models as part of their respective interpretations of classical political economy.
Samuel Hollander is one of the most influential and controversial living authors on History of Economic Thought, especially on classical economics.

Theory of value (economics)

theory of valuevaluepower theory of value
Classical economists developed a theory of value, or price, to investigate economic dynamics.
In classical economics, the labor theory of value asserts that the economic value of a good or service is determined by the total amount of socially necessary labor required to produce it.

Michael Hudson (economist)

Michael Hudson
Georgists and other modern classical economists and historians such as Michael Hudson argue that a major division between classical and neo-classical economics is the treatment or recognition of economic rent.
Hudson has extensively studied economic theories of many schools, including Physiocracy, classical political economy (Adam Smith, David Ricardo and Karl Marx, among others), neoclassical, Keynesian, post-Keynesian, Modern Monetary Theory and many others.

Factor price

natural price
William Petty introduced a fundamental distinction between market price and natural price to facilitate the portrayal of regularities in prices.
Classical and Marxist economists argue that factor prices decided the value of a product and therefore the value is intrinsic within the product.

Perspectives on capitalism by school of thought

Perspectives on Capitalismfoundations of capitalism
Adam Smith was one of the first influential writers on the topic with his book The Wealth of Nations, which is generally considered to be the start of classical economics which emerged in the 18th century.

Classical liberalism

classical liberalliberalclassical liberals
It drew on the classical economic ideas espoused by Adam Smith in Book One of The Wealth of Nations and on a belief in natural law, utilitarianism and progress.