David Ricardo: Theories on Classical Economics
David Ricardo was an 18th century, London economist who developed several theories contributing to what is now referred to as the “classical” system of economics. Classical economics, attributed primarily to 18th and 19th century Britain, is known for its focus on laissez-faire policies and pragmatic liberalism (Staff, 2015). As a Classical economist, Ricardo was a strong proponent of free trade, voicing his concerns in both the economic and political circles of London. Additionally, Ricardo’s formalization of numerous economic theories earned him both wealth and fame, as he is included among the ranks of other influential classical economists such as Adam Smith, Thomas Malthus, and James Mill. …show more content…
At 27, his interest in economics was piqued after reading Adam Smith’s, The Wealth of Nations (“David Ricardo,” n.d.). He began working with economic concepts and developing his own explanations for various occurrences; however, it was not until a decade later that Ricardo published his first article pertaining to economic principles, after being persuaded by close friend, James Mill, to share his ideas in writing. In 1810 he published The High Price of Bullion, a Proof of the Depreciation of Banknotes, a collection of letters he had written in the Morning Chronicle (Spengler, 2017). In it, Ricardo claimed that England’s inflation was a consequence of the Bank of England’s habit of issuing an excess of bank notes. Through his argument, he was essentially using an early presentation of the quantity theory of money - known as monetarism today - which claims that the economy can be stabilized by controlling the root supply of money. By the time his writing was published, Ricardo had established himself as a respected member of the financial community of London and his statements encouraged Parliament to create a committee to investigate the matters; the committee later found evidence supporting Ricardo’s claims (Spengler, 2017). However, concern over the matter was already fading as inflation ended and deflation became the new pressing issue, so Ricardo’s contributions were largely brushed
David Ricardo was an 18th century, London economist who developed several theories contributing to what is now referred to as the “classical” system of economics. Classical economics, attributed primarily to 18th and 19th century Britain, is known for its focus on laissez-faire policies and pragmatic liberalism (Staff, 2015). As a Classical economist, Ricardo was a strong proponent of free trade, voicing his concerns in both the economic and political circles of London. Additionally, Ricardo’s formalization of numerous economic theories earned him both wealth and fame, as he is included among the ranks of other influential classical economists such as Adam Smith, Thomas Malthus, and James Mill. …show more content…
At 27, his interest in economics was piqued after reading Adam Smith’s, The Wealth of Nations (“David Ricardo,” n.d.). He began working with economic concepts and developing his own explanations for various occurrences; however, it was not until a decade later that Ricardo published his first article pertaining to economic principles, after being persuaded by close friend, James Mill, to share his ideas in writing. In 1810 he published The High Price of Bullion, a Proof of the Depreciation of Banknotes, a collection of letters he had written in the Morning Chronicle (Spengler, 2017). In it, Ricardo claimed that England’s inflation was a consequence of the Bank of England’s habit of issuing an excess of bank notes. Through his argument, he was essentially using an early presentation of the quantity theory of money - known as monetarism today - which claims that the economy can be stabilized by controlling the root supply of money. By the time his writing was published, Ricardo had established himself as a respected member of the financial community of London and his statements encouraged Parliament to create a committee to investigate the matters; the committee later found evidence supporting Ricardo’s claims (Spengler, 2017). However, concern over the matter was already fading as inflation ended and deflation became the new pressing issue, so Ricardo’s contributions were largely brushed