History
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. These changes raised the question of how a society could be organized around a system in which every individual sought his or her own (monetary) gain. Classical political economy is popularly associated with the idea that free markets can regulate themselves.
Classical economists and their immediate predecessors reoriented economics away from an analysis of the ruler's personal interests to broader national interests. Adam Smith, and also physiocrat Francois Quesnay, for example, identified the wealth of a nation with the yearly national income, instead of the king's treasury. Smith saw this income as produced by labour, land, and capital. 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.
Read more about this topic: Classical Economics
Famous quotes containing the word history:
“The history of the Victorian Age will never be written: we know too much about it.”
—Lytton Strachey (1880–1932)
“The history of American politics is littered with bodies of people who took so pure a position that they had no clout at all.”
—Ben C. Bradlee (b. 1921)
“Philosophy of science without history of science is empty; history of science without philosophy of science is blind.”
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