Modern macro- and microeconomics are young sciences. But many in the past have thought on topics ranging from value to production relations. These forays into economic thought contribute to the modern understanding, ranging from ancient Greek conceptions of the role of the household and its choices to mercantilism and its emphasis on the hoarding of precious metals.
Austrian School Austrian economists advocate
methodological individualism in interpreting economic developments, the
subjective theory of value, that money is
non-neutral, and emphasize the
organizing power of the
price mechanism (see
Economic calculation debate) and a
laissez faire approach to the economy. •
Carl Menger •
Eugen von Böhm-Bawerk •
Ludwig von Mises •
Friedrich Hayek •
Friedrich von Wieser •
Henry Hazlitt •
Frank Fetter •
Israel Kirzner •
Murray Rothbard •
Robert P. Murphy •
Lew Rockwell •
Peter Schiff •
Marc Faber •
Walter Block •
Hans-Hermann Hoppe •
Jesús Huerta de Soto •
Fritz Machlup Ancient economic thought •
Chanakya (Kautilya) •
Xenophon •
Aristotle •
Qin Shi Huang •
Wang Anshi Islamic economics Islamic economics is the practice of economics in accordance with
Islamic law. The origins can be traced back to the
Caliphate, where an early
market economy and some of the earliest forms of
merchant capitalism took root between the 8th–12th centuries, which some refer to as "Islamic capitalism". Islamic economics seeks not only to enforce Islamic regulations on personal matters but also to implement broader economic goals and policies of an Islamic society, with a focus on uplifting the deprived masses. It was founded on the free and unhindered circulation of wealth to reach even the lowest echelons of society handsomely. One distinguishing feature is the wealth tax (in the form of both
Zakat and
Jizya), and a ban on levying taxes on all kinds of trade and transactions (Income/Sales/Excise/Import/Export duties, etc.). Another distinguishing feature is the prohibition of interest in the form of excess charges on money transactions. Its pronouncement on the use of paper currency also stands out. Though promissory notes are recognized, they must be fully backed by reserves.
Fractional-reserve banking is disallowed as a form of breach of
trust. Trade in Islamic societies saw innovations such as
trading companies,
big businesses,
contracts,
bills of exchange, long-distance
international trade, the first forms of
partnership (
mufawada) such as
limited partnerships (
mudaraba),
credit,
debt,
profit,
loss,
capital (
al-mal), and
capital accumulation (
nama al-mal),
circulating capital,
capital expenditure,
revenue,
cheques,
promissory notes,
trusts (see
Waqf),
startup companies,
savings accounts,
transactional accounts,
pawning,
loaning,
exchange rates,
bankers,
money changers,
ledgers,
deposits,
assignments, the
double-entry bookkeeping system, and
agency institution. This school has seen a revived interest in development and understanding since the latter part of the 20th century. •
Muhammad •
Abu Hanifa an-Nu‘man •
Abu Yusuf •
Al-Farabi (Alpharabius) •
Shams al-Mo'ali Abol-hasan Ghaboos ibn Wushmgir (Qabus) •
Ibn Sina (Avicenna) •
Ibn Miskawayh •
Al-Ghazali (Algazel) •
Ibn Taymiyyah •
Al-Mawardi •
Nasīr al-Dīn al-Tūsī (Tusi) •
Ibn Khaldun •
Al-Maqrizi •
Muhammad Baqir al-Sadr Scholasticism •
Nicole Oresme •
Thomas Aquinas •
School of Salamanca •
Leonardus Lessius Mercantilism Economic policy in Europe during the late Middle Ages and early
Renaissance treated economic activity as a good which was to be
taxed to raise revenues for the
nobility and the
church. Economic exchanges were regulated by
feudal rights, such as the right to collect a
toll or hold a
fair, as well as
guild restrictions and religious restrictions on
lending. Economic policy, such as it was, was designed to encourage trade through a particular area. Because of the importance of
social class,
sumptuary laws were enacted to regulate dress and housing, including allowable styles, materials, and the frequency of purchase for different classes.
Niccolò Machiavelli in his book
The Prince was one of the first authors to theorize economic policy in the form of advice. He did so by stating that princes and
republics should limit their expenditures and prevent either the wealthy or the populace from despoiling the other. In this way, a state would be seen as "generous" because it was not a heavy burden on its citizens. •
Gerard de Malynes •
Edward Misselden •
Thomas Mun •
Jean Bodin •
Jean Baptiste Colbert •
Josiah Child •
William Petty •
John Locke •
Charles Davenant •
Dudley North •
Ferdinando Galiani •
James Denham-Steuart Physiocrats The Physiocrats were 18th-century French economists who emphasized the importance of productive work, and particularly agriculture, to an economy's wealth. Their early support of free trade and deregulation influenced
Adam Smith and the classical economists. •
Anne Robert Jacques Turgot •
François Quesnay •
Pierre le Pesant de Boisguilbert •
Richard Cantillon Classical political economy Classical economics, also called classical
political economy, was the original form of mainstream economics of the 18th and 19th centuries. Classical economics focuses on the tendency of markets to move to equilibrium and on objective theories of value. Neo-classical economics differs from classical economics primarily in being
utilitarian in its value theory and using marginal theory as the basis of its models and equations. Marxian economics also descends from classical theory.
Anders Chydenius (1729–1803) was the leading
classical liberal of
Nordic history. Chydenius, who was a
Finnish priest and
member of parliament, published a book called
The National Gain in 1765, in which he proposes ideas of freedom of trade and industry and explores the relationship between economy and society and lays out the principles of
liberalism, all of this eleven years before
Adam Smith published a similar and more comprehensive book,
The Wealth of Nations. According to Chydenius, democracy, equality, and a respect for human rights were the only ways towards progress and happiness for the whole of society. •
Adam Smith •
Francis Hutcheson •
Bernard de Mandeville •
David Hume •
Henry George •
Thomas Malthus •
James Mill •
Francis Place •
David Ricardo •
Henry Thornton •
John Ramsay McCulloch •
James Maitland, 8th Earl of Lauderdale •
Jeremy Bentham •
Jean Charles Léonard de Sismondi •
Johann Heinrich von Thünen •
John Stuart Mill •
Karl Marx •
Nassau William Senior •
Edward Gibbon Wakefield •
John Rae •
Thomas Tooke •
Robert Torrens American School The American School owes its origin to the writings and economic policies of
Alexander Hamilton, the first
Treasury Secretary of the United States. It emphasized high
tariffs on imports to help develop the fledgling American manufacturing base and to finance infrastructure projects, as well as
National Banking,
Public Credit, and
government investment into advanced scientific and technological research and development.
Friedrich List, one of the most famous proponents of the
economic system, named it the National System, and was the main impetus behind the development of the German
Zollverein and the economic policies of Germany under Chancellor
Otto Von Bismarck beginning in 1879. •
Alexander Hamilton •
John Quincy Adams •
Henry Clay •
Mathew Carey •
Henry Charles Carey •
Abraham Lincoln •
Friedrich List •
Otto Von Bismarck •
Arthur Griffith •
William McKinley French Liberal School The French Liberal School (also called the "Optimist School" or "Orthodox School") is a 19th-century school of economic thought centered at the Collège de France and the Institut de France. The Journal des Économistes was instrumental in promulgating the ideas of the school. The school voraciously defended free trade and laissez-faire capitalism. They were primary opponents of collectivist, interventionist, and protectionist ideas. This made the French school a forerunner of the modern Austrian school. •
Frédéric Bastiat •
Maurice Block •
Pierre Paul Leroy-Beaulieu •
Gustave de Molinari •
Yves Guyot •
Jean-Baptiste Say •
Léon Say German Historical school The
German historical school of economics was an approach to academic economics and public administration that emerged in 19th-century Germany and held sway there until well into the 20th century. The Historical school held that history was the key source of knowledge about human actions and economic matters, since economics was culture-specific and therefore not generalizable across space and time. The school rejected the universal validity of economic theorems. They saw economics as arising from careful empirical and historical analysis rather than from logic and mathematics. The school preferred historical, political, and social studies to self-referential mathematical modelling. Most members of the school were also Kathedersozialisten, i.e., concerned with social reform and improved conditions for the common person during a period of heavy industrialization. The Historical School can be divided into three tendencies: the Older, led by
Wilhelm Roscher,
Karl Knies, and
Bruno Hildebrand; the Younger, led by
Gustav von Schmoller, and also including
Étienne Laspeyres,
Karl Bücher,
Adolph Wagner, and to some extent
Lujo Brentano; the Youngest, led by
Werner Sombart and including, to a very large extent,
Max Weber. Predecessors included
Friedrich List and
Adam Müller. The Historical school largely controlled appointments to Chairs of Economics in German universities, as many of the advisors of Friedrich Althoff, head of the university department in the Prussian Ministry of Education from 1882 to 1907, had studied under members of the school. Moreover, Prussia was the intellectual powerhouse of Germany and thus dominated academia not only in central Europe but also in the United States until about 1900, because holders of German Ph.D.s led the American economics profession. The Historical school was involved in the
Methodenstreit ("strife over method") with the Austrian School, whose orientation was more theoretical and a prioristic. In English-speaking countries, the Historical school is perhaps the least-known and least-understood approach to the study of economics because it differs radically from the now-dominant Anglo-American analytical point of view. Yet the Historical school forms the basis—both in theory and in practice—of the
social market economy, which for many decades has been the dominant economic paradigm in most countries of continental Europe. The Historical school is also a source of
Joseph Schumpeter's dynamic, change-oriented, and innovation-based economics. Although his writings could be critical of the School, Schumpeter's work on the role of innovation and entrepreneurship can be seen as a continuation of ideas originated by the Historical School, especially the work of von Schmoller and Sombart. •
Adam Müller •
Friedrich List •
Wilhelm Roscher •
Gustav von Schmoller •
Werner Sombart •
Max Weber •
Joseph Schumpeter •
Karl Polanyi English historical school Although not nearly as famous as its German counterpart, there was also an English Historical School, whose figures included
William Whewell,
Richard Jones,
Thomas Edward Cliffe Leslie,
Walter Bagehot,
Thorold Rogers,
Arnold Toynbee,
William Cunningham, and
William Ashley. It was this school that heavily critiqued the classical economists' deductive approach, especially the writings of
David Ricardo. This school revered the inductive process and called for the merging of historical fact with those of the present period. •
Edmund Burke •
Richard Jones •
Thomas Edward Cliffe Leslie •
Walter Bagehot •
Thorold Rogers •
William J. Ashley •
William Cunningham French historical school •
Clément Juglar •
Charles Gide •
Albert Aftalion •
Émile Levasseur •
François Simiand Utopian economics •
William Godwin •
Charles Fourier •
Robert Owen •
Saint-Simon •
Josiah Warren Georgist economics Georgism, or geoism, is an economic philosophy proposing that both individual and national economic outcomes would be improved by the utilization of
economic rent arising from control over land and natural resources through levies such as a
land value tax. •
Harry Gunnison Brown •
Raymond Crotty •
Ottmar Edenhofer •
Fred Foldvary •
Mason Gaffney •
Henry George •
Max Hirsch (labor economist) •
Wolf Ladejinsky •
Philippe Legrain •
Donald Shoup •
Nicolaus Tideman Ricardian socialism Ricardian socialism is a branch of early 19th-century classical economic thought based on the theory that labor is the source of all wealth and exchange value, and rent, profit, and interest represent distortions to a free market. The pre-Marxian theories of capitalist exploitation that they developed are widely regarded as heavily influenced by the works of
David Ricardo and as favouring collective ownership of the
means of production. •
John Francis Bray •
John Gray •
Charles Hall •
Thomas Hodgskin •
William Thompson Marxian economics Marxian economics descended from the work of
Karl Marx and
Friedrich Engels. This school focuses on the
labor theory of value and on what Marx considered the exploitation of labour by capital. Thus, in Marxian economics, the labour theory of value is a method for measuring the exploitation of labour in a capitalist society rather than simply a theory of price. •
David Harvey •
Eduard Bernstein •
Friedrich Engels •
Grigory Feldman •
Rosa Luxemburg •
Richard D. Wolff •
Rudolf Hilferding •
Karl Kautsky •
Karl Marx •
Nikolai Bukharin •
Nobuo Okishio •
Paul Sweezy •
Samir Amin •
Vladimir Lenin •
Yevgeni Preobrazhensky Neo-Marxian economics •
David Gordon •
Samuel Bowles •
Paul A. Baran •
Adam Przeworski •
Henryk Grossman State socialism •
Henri de Saint-Simon •
Ferdinand Lassalle •
Johann Karl Rodbertus •
Fabian Society Anarchist economics Anarchist economics comprises a set of theories that seek to outline modes of production and exchange not governed by coercive social institutions: •
Mutualists advocate for market socialism with
cooperatives,
mutual banking, and
usufructs. •
Collectivist anarchists advocate for
collective ownership,
decentralised economic planning, and
salaries based on the amount of time contributed to production. •
Anarcho-communists advocate for a direct transition from capitalism to libertarian
communism and a
gift economy with direct
communal decision-making and
free association. •
Anarcho-syndicalists advocate for the abolition of
wage labour,
industrial unionism, and
workers' self-management through
syndicates. Thinkers associated with anarchist economics include: •
Charles Fourier •
Pierre-Joseph Proudhon •
Peter Kropotkin •
Mikhail Bakunin •
Josiah Warren •
Lysander Spooner Distributism Distributism is an economic philosophy that was originally formulated in the late 19th century and early 20th century by Catholic thinkers to reflect the teachings of Pope Leo XIII's encyclical
Rerum Novarum and Pope Pius XI's encyclical
Quadragesimo Anno. It seeks a third way between capitalism and socialism, aiming to order society according to Christian principles of justice while preserving private property. •
G. K. Chesterton •
Hilaire Belloc Institutional economics Institutional economics focuses on understanding the roles of evolutionary processes and institutions in shaping economic behaviour. Its original focus lay in
Thorstein Veblen's instinct-oriented dichotomy between technology on the one side and the "ceremonial" sphere of society on the other. Its name and core elements trace back to a 1919
American Economic Review article by
Walton H. Hamilton. •
Gunnar Myrdal •
Thorstein Veblen •
John Rogers Commons •
Wesley Clair Mitchell •
John Maurice Clark •
Robert A. Brady •
Clarence Edwin Ayres •
Romesh Dutt •
John Kenneth Galbraith •
Geoffrey Hodgson •
Ha-Joon Chang Neoclassical economics Neoclassical economics is often referred to by its critics as
Orthodox Economics. The more specific definition this approach implies was captured by
Lionel Robbins in a
1932 essay: "the science which studies human behavior as a relation between scarce means having alternative uses." The definition of scarcity is that available resources are insufficient to satisfy all wants and needs; if there is no scarcity and no alternative uses of available resources, then there is no
economic problem. •
William Stanley Jevons •
Francis Ysidro Edgeworth •
Alfred Marshall •
John Bates Clark •
Irving Fisher •
Knut Wicksell Lausanne School The Lausanne School of Economics is an extension of the
neoclassical school of economic thought, named after the
University of Lausanne in
Switzerland. The school is primarily associated with
Léon Walras and
Vilfredo Pareto, both of whom held successive professorships in political economy at the university in the latter half of the 19th century. Beginning with Walras, the school is credited with playing a central role in the development of
mathematical economics. For this reason, the school has also been referred to as the Mathematical School. A notable work of the Lausanne School is Walras' development of the
general equilibrium theory as a holistic means of analysing the economy, in contrast to
partial equilibrium theory, which only analyses single markets in isolation. The theory shows how a general equilibrium is reached through the interaction between demand and supply in an economy consisting of multiple markets operating simultaneously. The Lausanne School is also largely credited with the development of
welfare economics, through which Pareto sought to measure an economy's welfare. Contrary to
utilitarianism, Pareto found that the welfare of an economy cannot be measured by aggregating the individual utilities of its inhabitants. Since individual utilities are subjective, their measurements may not be directly comparable. This led Pareto to conclude that if at least one person's utility increased while no one else was made worse off, then the economy's welfare would increase. Conversely, if a majority of people experienced an increase in utility while at least one person was worse off, there could be no definitive conclusion about the welfare of the economy. These observations formed the basis of
Pareto efficiency, which describes a situation or outcome in which nobody can be made better off without also making someone else worse off. Pareto efficiency is still widely used in contemporary welfare economics as well as
game theory. •
Léon Walras •
Vilfredo Pareto Stockholm School The Stockholm School is a school of economic thought. It refers to a loosely organized group of Swedish economists who worked together in Stockholm, Sweden, primarily in the 1930s. The Stockholm School had—like John Maynard Keynes—come to the same conclusions in macroeconomics and the theories of demand and supply. Like Keynes, they were inspired by the works of Knut Wicksell, a Swedish economist active in the early years of the twentieth century. •
Gunnar Myrdal •
Bertil Ohlin Keynesian economics Keynesian economics has developed from the work of
John Maynard Keynes and focuses on short-run macroeconomics, particularly the rigidities that arise when prices are fixed. It has two successors.
Post-Keynesian economics is an alternative school—one of the successors to the Keynesian tradition—focused on
macroeconomics. They concentrate on macroeconomic rigidities and adjustment processes, and research the microfoundations of their models based on real-world practices rather than simple optimizing models. Generally associated with
Cambridge, England, and the work of
Joan Robinson (see
Post-Keynesian economics).
New-Keynesian economics is the other school associated with developments in the Keynesian fashion. These researchers tend to share with other
Neoclassical economists an emphasis on microfounded models and optimizing behavior, but focus more narrowly on standard Keynesian themes such as price and wage rigidity. These are usually treated as endogenous features of these models, rather than assumed, as in older-style Keynesian ones (see
New-Keynesian economics). •
John Maynard Keynes •
Joan Robinson •
Paul Krugman •
Paul Samuelson •
Peter Bofinger •
Joseph Stiglitz •
Nouriel Roubini •
Stanley Fischer •
Gregory Mankiw •
Jason Furman •
Huw Dixon Chicago school The Chicago School is a neoclassical school of economic thought associated with the work of the faculty at the University of Chicago, notable particularly in macroeconomics for developing
monetarism as an alternative to Keynesianism and its influence on the use of
rational expectations in macroeconomic modelling. •
Frank H. Knight •
Jacob Viner •
Milton Friedman •
Thomas Sowell •
George Stigler •
Harry Markowitz •
Merton Miller •
Robert Lucas, Jr. •
Eugene Fama •
Myron Scholes •
Gary Becker •
Edward C. Prescott •
James Heckman •
Robert Z. Aliber Carnegie School •
Herbert A. Simon •
Richard Cyert •
James March •
Victor Vroom •
Oliver E. Williamson •
John Muth Neo-Ricardianism •
Piero Sraffa •
Luigi L. Pasinetti •
Vladimir Karpovich Dmitriev New institutional economics New institutional economics is a perspective that attempts to extend economics by focusing on the
social and
legal norms and rules (which are
institutions) that underlie economic activity and with analysis beyond earlier
institutional economics and
neoclassical economics. It can be seen as a broadening step to include aspects excluded in neoclassical economics. It rediscovers aspects of classical
political economy. •
Douglass North •
Oliver E. Williamson •
Ronald Coase •
Daron Acemoglu •
Steven N. S. Cheung ==20th century schools==