There are four stages in the development of classical political economy:
Stage 1: the formation of signs of an emerging new (later called "classical political economy") doctrine, an alternative to mercantilism (late 17th - early 18th centuries). Works appear, the authors of which sharply condemned the protectionist system and emphasized the priority importance of liberal economic principles in creating wealth (W. Petty - in England, P. Boisguillebert - in France). The first attempts at costly interpretation of the cost of goods and services are being made. Physiocracy appears - a specific trend within the framework of the classical school, which continued the reasoned criticism of mercantilism and significantly advanced economic science (F. Quesnay, A. Turgot);
Stage 2: development of classical political economy. This period of development of the classical school is entirely associated with the name of A. Smith, the greatest English scientist and economist of the late 18th century. His famous work "Investigation into the Nature and Causes of the Wealth of Nations" became the first full-fledged work in economic science that outlined general fundamentals economic science. Smith's interpretations of the product and its properties, money, wages, profit, capital, productive labor, etc. underlie modern economic concepts;
Stage 3: development of classical political economy by the followers of A. Smith (first half of the 19th century). In the historical aspect, this is the period of completion of the industrial revolution, which marked the transition from manufacturing to machine (industrial) production. In the era of transition to an industrial society, the ideas of A. Smith were supplemented and developed by a number of his followers (D. Ricardo, J. B. Say, T. Malthus, N. Senior, F. Bastiat, etc.)
Stage 4: completion of classical political economy (second half of the 19th century). The best achievements of the classical school were summarized in the works of J.S. Mil and K. Marx. Despite the fact that during this period a new direction of economic thought began to take shape, which later received the name of neoclassical theory, the theoretical views of the classics continued to maintain their popularity. The last leaders of classical political economy were sympathetic to the working class and turned towards socialism and reform.
classical political Economy was built on the basis of the application of progressive methodological methods of research known at that time, such as causal (causal), inductive and deductive, scientific (logical) abstraction, etc. During the period of the classical school, political economy became a truly scientific discipline that studies the economy of a free competition.
Economic views of W. Petty.
William Petty(1623-1687) - founder of classical political economy in England
Main works: “Treatise on taxes and fees” (1662), “Word to the wise” (1664), “Political arithmetic” (1676), “Miscellaneous about money” (1682)
The subject of political economy is to find out ways to increase wealth, and in particular the amount of money in the English kingdom ("Political Anatomy of Ireland")
Methodology:- the use of mathematics for economic analysis, that is, the research method for the first time receives a statistical justification; - method of scientific abstraction
The main provisions of economic doctrine: - W. Petty - the first author of the labor theory of value, which is based on the doctrine of natural price (value). He distinguished between natural and market prices, which vary depending on the ratio of supply and demand. The basis of the price - the "natural" price (value) is determined by the labor spent on the production of goods; - the formation of wealth occurs in the sphere of material production; four factors are involved in its production: labor and land are the main ones, qualifications, the art of its labor and means of labor (tools, stocks, materials) are not the main ones, but they make labor productive and cannot exist independently, that is, without labor and land; - the formula “labor is the father and the active principle of wealth, and the earth is its mother”; — W. Petty opposed the influx precious metals, as he saw this as a source of price growth; - noted the existence of a proportion of money for trade exchange; an excess of money leads to higher prices, and a lack of money leads to a reduction in the volume of work performed and a low level of tax payments; - Created economic statistics (political arithmetic) and proposed a method for calculating national income. The theory of rent, the price of land and interest on loans.
Rent- the surplus of value over production costs, which were reduced mainly to the cost of labor (wages were reduced to a minimum of means of subsistence). Specific forms of manifestation of rent are land rent and money rent (interest).
W. Petty introduced the concept of differential land rent, the reasons for the existence of which are in various fertility and location of lands. He considered the price of land in close connection with the problem of rent. The price of land should represent the capitalized land rent, that is, the sum of annual rents for a certain number of years. (the number of years is 21 years - the period of simultaneous life expectancy of three generations, grandfather (50 years), son (28 years), grandson (7 years). This is an arbitrary calculation that did not solve the problem. To solve it, you need to know the nature of the loan interest
Loan interest- payment for the inconvenience caused to the creditor in the narrowing of money. The level of interest must not exceed the amount of rent from the amount of land that can be bought with a loan. Thus, U. Petit acted as interest not as a predetermined quantity associated with the movement of profit, but only as a special form of rent.
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> Economic theory
The contribution of the classical school of political economy to the development of economic science
classical school political economy is one of the mature trends in economic thought. It is called classical, first of all, for the scientific nature of many of its theories and methodological provisions. The school was founded at the end of the 17th century. and flourished in the 18th and 19th centuries. There are four stages in its development.
First stage(late 17th century - second half of the 18th century) - the era of the birth of classical political economy . This period is characterized by the expansion of the sphere market relations. The economic thought of that time was no longer focused on the sphere of circulation, but on the sphere of production.
Leading representatives - William Petty (England) and Pierre Boisguillebert (France).
The economist opposed the influx of precious metals into the country, as he saw it as a source of growth in domestic prices. Petty noted that an excess of money leads to an increase in prices, and a lack of money leads to a reduction in the volume of work performed. In other words, he was a supporter quantity theory of money .
Second phase(last third of the 18th century) - the heyday of classical political economy, the formation of its main categories and laws .
This stage in the development of science is associated with the name and works of the Scottish economist and philosopher Adam Smith, who first expounded economic theory as a holistic science, in the interconnection of all its elements.
According to A. Smith, the main motive economic activity person is a personal interest. He considered man an economic being, that is, a person endowed with egoism and striving for ever greater accumulation of wealth. In this regard, the economist formulated principle of the "invisible hand of the market" , according to which, the individual, pursuing his own interests, is sent mechanism of free competition in the interests of the whole society.
The basis of the economic doctrine of A. Smith was the principle of free competition, as the main condition for the operation of economic laws. It is only with the free movement of goods, money, capital and people that society's resources are optimally used. The state in the economy is assigned the role of "night watchman" - a guarantor of compliance with the market "rules of the game", but not its participant.
Third stage(first half of the 19th century) - this is the period of completion of the industrial revolution in most industrial developed countries. Main the provisions and laws of classical political economy are being reworked, their further development is underway .
The leading representatives of this stage are Jean Baptiste Say, David Ricardo.
D. Ricardo completed the creation of classical political economy. His undoubted merit is that he presented political economy in a strict logical sequence, systematized the economic knowledge of that time. Like A. Smith, he was against state intervention in the economy. Condition economic development considered free competition and other principles of the policy of economic liberalism.
In addition, the scientist formulated theory of comparative advantage in which he proved the mutual benefit of international trade.
Fourth stage(second half of the 19th century) - final period of formation classical political economy . At this time, a number of provisions of classical political economy are subject to significant adjustments, new directions of economic thought are being formed.
The leading representatives of this period were John Stuart Mill and Karl Marx, who summed up the best achievements of the school.
D. Mill supported general principle classical political economy on the freedom of the market, but noted the existence various areas social activities where the market mechanism is unacceptable. In this regard, he put forward the idea of enhancing the participation of the state in the socio-economic development of society. He owns the first judgments about socialism and the socialist structure of society.
Karl Marx was the founder of the theoretical concept, called "Marxism". Marxism is a peculiar version of the development of the classical economic school defending and defending the interests of the working class.
The cornerstone of Marxism - surplus value theory , according to which labor is the only source of wealth, while the profit of the capitalists and the rent of landowners are only a part of the value created by the labor of workers and appropriated free of charge by the owners of capital and land.
Marx's ideas had a significant impact on social thought and political practice in the late 19th and 20th centuries. His name is associated with the largest attempt of people to build a society without private property and exploitation.
Thus, classical political economy occupied "commanding heights" in economic theory almost 200 years, laying foundations for modern economics .
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Introduction
1. general characteristics classical political economy
2. The main representatives of classical political economy
2.1 "Political Arithmetic" by William. petty
2.4 Treatise on Political Economy by Jean Baptiste Say
Conclusion
Bibliography
classical political economy petty smith
Introduction
Theme of my control work seems irrelevant today. Some economists consider it superfluous to refer to the theories and views of the past, because these theories and views have “overgrown with shells” and have lost their significance, and therefore one should not waste time getting acquainted with them.
Those who hold such a purely negative opinion are relatively few. The vast majority of experts do not share it.
The purpose of my work is to characterize one of the trends in the history of economics, namely classical political economy: the general features that characterize this trend, its most famous representatives and their contribution to economics.
The “classics” presented the processes taking place in the economy in a whole, most enriched form as a sphere of interrelated laws and categories, as a logically coherent system of relations.
The classical school laid a weighty foundation for economic theory, which opened the way for further improvement, deepening and development.
Studying the evolution of economic concepts, we seek to understand how the process of formation and enrichment of our knowledge about the economy unfolds, how and why many ideas of the past remain relevant today, how they influence our modern ideas.
1. General characteristics of classical political economy
1.1 Definition of classical political economy
The classical school of political economy is one of the mature trends in economic thought that have left a deep mark on the history of economic thought. The economic ideas of the classical school have not lost their significance to this day. classic direction originated in the 17th century and flourished in the 18th and early XIX century. The greatest merit of the classics is that they placed at the center of the economy and economic research labor as a creative force and value as the embodiment of value, thereby laying the foundation for the labor theory of value. The classical school became the herald of the ideas of economic freedom, the liberal trend in the economy. Representatives of the classical school developed a scientific understanding of surplus value, profits, land rent taxes. In the depths of the classical school, in fact, economic science was born.
Classical political economy arose when entrepreneurial activity, following the sphere of trade, monetary circulation and lending operations also spread to many industries and the production sector as a whole. Therefore, already in the manufacturing period, which brought to the fore in the economy the capital employed in the sphere of production, the protectionism of the mercantilists ceded its dominant position to a new concept - the concept of economic liberalism, based on the principles of non-intervention of the state in economic processes, unlimited freedom of competition of entrepreneurs.
For the first time, the term "classical political economy" was used by one of its consummators, K. Marx, in order to show its specific place in "bourgeois political economy." And the specificity, according to Marx, lies in the fact that from W. Petty to D. Ricardo in England and from P. Boisguillebert to S. Sismondi in France, classical political economy “explored the actual production relations of bourgeois society.”
As a result of the decomposition of mercantilism and the strengthening of the growing trend of limiting direct state control over economic activity, “pre-industrial conditions” lost their former significance and “free private enterprise” prevailed. The latter, according to P. Samuelson, led “to the conditions of complete laissez faire (that is, absolute non-intervention of the state in business life), events began to take a different turn", and only "... from the end of the 19th century. in almost all countries there was a steady expansion of the economic functions of the state.
In fact, the principle of "total laissez faire" became the main motto of a new direction of economic thought - classical political economy, and its representatives debunked mercantilism and the protectionist policy promoted by it in the economy, putting forward an alternative concept of economic liberalism.
In modern foreign economic literature While paying tribute to the achievements of classical political economy, they do not idealize them. At the same time, in the system of economic education in most countries of the world, the selection of the “classical school” as an appropriate section of the course on the history of economic doctrines is carried out primarily from the point of view of the general characteristics inherent in the works of its authors. characteristic features and hell:
Emphasis on the analysis of the problems of production and distribution of material goods;
Development and application of progressive methodological methods of research;
Nucleus economic analysis classics - the problem of value;
All the classics interpreted value as a value determined by production costs;
Perception economic system as a system similar to the objects of study of physics of that time (more precisely, mechanics). This, in turn, led to the following features of the economic analysis of the classical school: the conviction that the market (capitalist) economy is dominated by universal and objective (economic) laws; and ignoring the subjective-psychological factors of economic life.
Underestimation of the role of money and the influence of the sphere of circulation on the sphere of production.
Money was perceived by the classics as technical means to facilitate exchange. The classics ignored the role of money as the most liquid store of value. The finalist of classical political economy, J. S. Mill, wrote: “In short, one can hardly find in the social economy a thing more insignificant in its importance than money, if one does not touch on the way in which time and labor are saved”;
Great emphasis on the study of the "laws of motion", i.e. patterns of trends, dynamics, capitalist economy.
Negative attitude (with rare exceptions like J.S. Mill) to the active intervention of the state in the economy. The classics, following the physiocrats, advocated the ideology of laissez-faire.
1.2 Stages in the development of classical political economy
According to the generally accepted assessment, classical political economy originated at the end of the 17th - beginning of the 18th centuries. in the works of W. Petty (England) and P. Boisguillebert (France). The time of its completion is considered from two theoretical and methodological positions. One of them, the Marxist one, points to the period of the first quarter of the 19th century, and the English scientists A. Smith and D. Ricardo are considered to be the finalists of the school. According to the most common in the scientific world, the classics exhausted themselves in the last third of the 19th century. works of J. S. Mill. In the development of classical political economy, with a certain conventionality, four stages can be distinguished.
The firststage covers the period from the end of the XVII century. before the start of the second half of XVIII in. This is the stage of a significant expansion of the sphere of market relations, reasoned refutation of the ideas of mercantilism and its complete debunking. The first representative and progenitor of the classical school should be considered the English economist W. Petty, whom Marx called "the father of political economy and in some way the inventor of statistics."
Secondstage The development of classical political economy covers the period of the last third of the 18th century. and is associated with the name and works of A. Smith. His influence affected more than one school.
Thirdstage The evolution of the classical school falls on the first half of the 19th century, when the industrial revolution ended in a number of developed countries. During this period, the followers of Smith subjected to in-depth study and rethinking of the main ideas and concepts of their idol, enriched the school with fundamentally new and significant theoretical provisions. The representatives of this stage include J. B. Say, the Englishmen D, Ricardo, T. Malthus and N. Senior, and others. Each of them left a rather noticeable mark in the history of economic thought and the formation of market relations.
Fourth the final stage in the development of classical political economy covers the period of the second half of XIX century, during which J. S. Mill and K. Marx summarized the best achievements of the school. On the other hand, by this time, new, more progressive trends in economic thought were already gaining independent significance, which later received the names “marginalism” (end of the 19th century) and “institutionalism” (beginning of the 20th century).
2. The main representatives of classical political economy
2.1 "Political Arithmetic" by William Petty
William Petty (1623-1687) laid the foundation for the formation of the classical school. He is called the founder of statistics, a man who expressed in fragments a lot of interesting considerations and conclusions, opening the way to the creation of economic theory, economic science.
Petty was not interested in the external manifestation, but in the essence of economic processes, he tried to "explain the mysterious nature" of taxes and their consequences, monetary rent, rent from land, money, the sources of wealth. In his opinion, the subject of study of political economy is, first of all, the analysis of the problems of the sphere of production, he believed that the creation and increase of wealth occurs exclusively in the sphere of material production.
In A Treatise on Taxes and Duties, Petty concludes that "there is a certain measure or proportion of money necessary for the conduct of the trade of a country." Excess or lack of money against this measure will harm her. Reducing the metal content of money cannot be a source of wealth.
In his works, he considered what factors are involved in the production of products, the creation of wealth. Petty identifies four factors. The first two - land and labor - are the main ones. He believes that “the assessment of all subjects should be brought to two natural denominators: land and labor, i.e. we ought to say: the value of a ship or a coat is equal to the value of such and such a quantity of labor, because after all, both the ship and the coat are produced by land and human labor.
The other two factors involved in creating a product are not the main ones. These are qualifications, the art of the worker and the means of his labor - tools, stocks and materials. They make work productive. But both of these factors cannot exist independently; without labor and land.
Thus, Petty considered two measures of value - labor and land. In practice, he proceeded from the fact that in any kind of labor there is something in common that allows you to compare all types of labor with each other.
W. Petty believed that wealth is created primarily by labor and its results.
Petty expressed a number of theses, which contain the initial provisions of the theory of value. Money has value. The amount of money that can be received for a product determines its value. They are determined not directly through labor costs, but indirectly through the costs of producing money (silver and gold) offered for these products. It is not all labor that creates value, but that which is expended in the production of silver.
The incomes of entrepreneurs and landowners are characterized by W. Petty by means of the essentially unified concept of “rent”. In particular, calling the rent from the land the difference between the cost of grain and the costs of its production, he replaced by it such a concept as the farmer's profit.
A hundred years before A. Smith, W. Petty anticipated and put forward many ideas, which he later clarified, brought into logical order, and A. Smith freed from some contradictions and inconsistencies.
2.2 Adam Smith: "An Inquiry into the Nature and Causes of the Wealth of Nations"
Adam Smith is called the founder of the classical school. It was A. Smith (1723-1790), professor and systematist, armchair scientist and encyclopedically educated researcher, who developed and presented the economic picture of society as a system.
The work of A. Smith "The Wealth of Nations" is not a collection of recommendations, but a work that presents a certain concept in a systematic way. It is full of examples, historical analogies, references to economic practice.
Labortheorycost
What Petty expressed in the form of conjectures, Adam Smith substantiated as a system, an expanded concept. “The wealth of the people does not consist in land alone, not in money alone, but in all things that are suitable for satisfying our needs and for increasing our enjoyment of life.”
Unlike the mercantilists and physiocrats, Smith argued that the source of wealth was not to be found in any particular occupation. Wealth is the product of the combined labor of all - farmers, artisans, sailors, merchants, i.e. representatives of various types of work and professions. Labor is the source of wealth, the creator of all values.
According to Smith, the true creator of wealth is "the annual labor of every nation" directed for annual consumption. In modern terminology, this is the gross national product(GNP).
He distinguishes between those types of labor that are embodied in material things, and those that, like the labor of a domestic servant, are a service, and services "disappear at the very moment they are provided." Just because labor is useful does not mean that it is productive.
All wealth is created by labor, but the products of labor are not created for themselves, but for exchange (“every person lives by exchange or becomes, to a certain extent, a merchant”). The meaning of a commodity society is that products are produced as commodities for exchange. It's not just that the exchange of goods for goods is equivalent to the labor expended. The result of the exchange is mutually beneficial.
Oseparationlaborandexchange
People are bound by the division of labor. It makes the exchange profitable for its participants, and the market, commodity society - efficient. Buying someone else's labor, its buyer saves his own labor.
According to Smith, the division of labor plays the most important role in increasing the productive power of labor and the growth of national wealth. The deeper the division of labor, the more intense the exchange.
"Give me what I need and you will get what you need." "It is in this way that we obtain from each other a far greater part of the services we need" are Smith's statements often quoted by commentators on his work.
"Invisiblehand"marketforces
One of the leading ideas of The Wealth of Nations is about the "invisible hand". The market economy is not governed by single center, does not obey one common plan. Nevertheless, it functions according to certain rules, follows a certain order.
The paradox or essence of the market mechanism lies in the fact that private interest and the pursuit of one's own benefit benefits society, ensures the achievement of the common good. In a market economy (in a market mechanism), the “invisible hand” of market forces operates, market mechanisms, which implies minimal state intervention and market self-regulation based on free prices, which are formed depending on supply and demand under the influence of competition.
Twoapproachtoeducationcost
Considering the problem of pricing and the essence of price, Smith put forward two positions.
The first is that the price of a commodity is determined by the labor expended on it. This provision, in his opinion, is applicable in "primitive societies". And Smith puts forward the second, according to which value, and hence the price, is made up of labor costs, profit, interest on capital, ground rent, i.e. determined by production costs. The essence of these provisions is reflected in Figure 1: the first position is in the form of a solid arrow with the inscription "Labor", and the second is expressed using dotted arrows with the inscriptions "Capital" and "Land".
Principleeconomicfreedom
Smith believed that the market needed to be protected from outside interference. The freedom of economic activity of individuals should not be hindered, it should not be strictly regulated. Smith opposes excessive restrictions on the part of the state, he is for freedom of trade, including foreign trade, for a policy of free trade, against protectionism.
Rolestates,principlestaxation
Without completely rejecting participation in economic life and control by the state, Smith assigns him the role of a "night watchman", and not a regulator and regulator of economic processes.
Smith identifies three functions that the state is called upon to perform: the administration of justice, the defense of the country, the organization and maintenance of public institutions.
He also argues that the payment of taxes should not be imposed on one class, as suggested by the physiocrats, but on all equally - on labor, on capital and on land.
Smith substantiates the principle of proportional division of the tax burden - according to the level of property solvency of taxpayers.
It is believed that Smith's three postulates (analysis " economic man”, “invisible hand” of the market, wealth as an objective function and an object economic relations) still determine the vector of economic science. They form the Smith paradigm.
2.3 David Ricardo: "Principles of Political Economy"
David Ricardo (1772-1823) sought to overcome the inconsistency of individual provisions, to more clearly substantiate other provisions, and to develop others more fully.
Ricardo actually continued the formation of the fundamental principles of the classical school of political economy and, together with Smith, is considered its founder.
Ricardo's main work is "The Principles of Political Economy and taxation» (1817). Ricardo showed that he, like A. Smith, was primarily interested in the inevitable economic "laws", the knowledge of which would make it possible to control the distribution of income created in the sphere of material production.
Theorycost-positionRicardo
Rejecting Smith's dual assessment of this category, he categorically insists that only one factor "labor" underlies value. According to his formulation, “the value of a commodity, or the quantity of any other commodity for which it is exchanged, depends on the relative quantity of labor which is necessary for its production, and not on the greater or lesser remuneration that is paid for this labour.”
Theoryof money
The positions of D. Ricardo on the theory of money were based on the provisions characteristic of the form of the gold coin standard, according to which the amount of gold specified by law in a coin minted for circulation was subject to free and guaranteed exchange paper money. With this in mind, the author of the "Beginnings" wrote that "neither gold nor any other commodity can always serve as a perfect measure of value for all things." In addition, D. Ricardo was a supporter of the quantity theory of money, linking the change in their value as commodities with their (money) quantity in circulation. He also believed that “money serves as a general medium of exchange between all civilized countries and is distributed among them in proportions that change with every improvement in trade and machines, with every increase in the difficulty of obtaining food and other items. vital necessity for a growing population." Finally, in his opinion, money, as commodities, with a decrease in its value, necessitates an increase in wages, which in turn "... is invariably accompanied by an increase in the price of commodities."
Theoryincome
The income theory of D. Ricardo significantly enriched classical political economy in terms of characterizing the essence of rent, profit and wages.
Ricardo believed that rent was not the result of the "generosity" of nature, but of its "poverty", the lack of rich and fertile plots of land. The source of rent lies in the fact that the land is the property of its owners. If air and water "could be turned into property" and were available in limited quantities, "then they, like land, would give rent",
Justifying the process of rent formation, Ricardo refers to the growth in demand for agricultural products associated with an increase in population) and the process of involving more and more new lands in agricultural circulation.
Rent exists not only in the transition from the best land to the worst. Prerequisites, conditions for its existence - differences in quality, fertility, location of lands, the degree of their cultivation. Rent may also take place when the land is occupied and requires ever greater expenditures of labor and capital. Rent is always paid for the use of land only because the quantity of land is not unlimited, and its quality varies.
Ricardo's theory of rent practical value. The provisions and conclusions substantiated by the English classic were directed against the establishment of high duties on bread.
Ricardo's theory of rent helps to understand his interpretation of the relationships and trends of the main incomes: wages, profits, rents.
At the beginning of his work, in the chapter "On Value", Ricardo argued with Smith, who believed that an increase in wages leads to a change in the value and price of products produced. The value of a commodity, said Ricardo, does not depend on the amount of remuneration for labor, but on the quantity of labor necessary for the production of the commodity; it is determined by the amount of labor embodied in it.
Considering the relationship between the size of profits and wages of workers, Ricardo comes to the conclusion that an increase in nominal wages leads to a decrease in profits, because wages and profits are antagonistic, are in inverse relation to each other. "A rise in wages does not raise the prices of commodities, but invariably lowers profits." "Anything that increases wages necessarily reduces profits."
According to Ricardo, the main trend that characterizes the dynamics of income is as follows: with the development of society, real wages remain unchanged, rent increases, and the level of profit falls.
Theoryreproduction
Ricardo recognized Say's law of markets, i.e., the dogma of a crisis-free and equilibrium state of the economy under full time. In particular, as if in recognition of Say's law, he wrote: “Products are always bought for products or services; money is only the standard by which this exchange takes place. A commodity may be overproduced, and the market will be so crowded that even the capital expended on that commodity will not be replaced. But this cannot happen to all goods at the same time.”
Theory"comparativecosts"
Ricardo proposed the theory of "comparative costs" (comparative advantages), which became theoretical basis the policy of "free trade" (free trade) and in modern versions is used to justify and develop the so-called "open economy" policy.
The general meaning of this concept is that if governments various countries do not impose any restrictions on foreign trade with each other, the economy of each country begins to gradually specialize in the production of those goods, the production of which requires less labor time. Free trade allows countries to consume as many goods as they did before specialization, minimizing the labor time required to create a given amount of goods. As a follower of Smith and Malthus, Ricardo introduced significant contribution in the development and refinement of various specific problems of economic theory.
2.4 Jean Baptiste Say: "Treatise of Political Economy"
J.B. Say (1767-1832) was the largest representative of the classical school in France, a merchant and entrepreneur, a scientist and professor of industrial economics - known as a popularizer of the works of the founders of the classical school, the creator of his own, subjective concept of value (value). The main work of Zh.B. Say - "A Treatise of Political Economy, or a simple statement of the way in which wealth is formed, distributed and consumed" (1803).
His concepts - to a greater extent than the concepts of other classics - led to the conclusion of the stability and consistency of the capitalist economy, for which he received the most fierce criticism from representatives of many heretical trends in economics - from Marxists to Keynesians.
Whatissourcevalues?
One of the starting points is Say's position on the source of value (cost) of goods and services. Unlike A. Smith, who ultimately reduced the source of income to labor (according to the labor theory of value), Say puts utility rather than labor costs at the forefront: “utility informs objects of value.”
According to Say's concept, the criterion of productivity is utility. Therefore, the labor of artisans and the labor of farmers, the labor of teachers and the labor of doctors should be considered productive.
It is not the material form of the product that is important, but the result of the activity is important. As a result of production activity, the service does not have to take the form of a material product.
Theoryproductionfactors
The theory of production factors is based on Say's position on the determining role of utility in shaping the value of goods and multiplying wealth.
J. B. Say was the first of the classics to clearly and unambiguously formulate the idea that the value of a commodity is equal to the sum of wages, profits and rent, i.e. the sum of the incomes of the owners of production factors used in the manufacture of this product. At the same time, according to Zh.B. Say, each factor of production participates in the production process, providing its service, and therefore contributes to the creation of the value of goods. The amount of such contribution is determined by the market specific product. The amount of wages characterizes the contribution of labor, the amount of interest - the contribution of capital, the amount of land rent - the contribution of land. Entrepreneurial profit is reduced by him to the wages of highly skilled labor associated with the organization of production activity, that is, the effective combination of other factors of production. The French economist attached special importance to this type of labor - the labor of an entrepreneur. It is the entrepreneurs who provide the offer finished goods and make demand for factors of production, thereby giving employment to the labor force. They also distribute wealth.
LawmarketsSay
As part of his theory of sales markets, Say formulated the law, which was later named after him. According to Say's theory of sales markets, "sales for products are created by production itself", i.e. supply creates demand. These are two equivalent formulations of Say's law.
This law, in turn, leads to the following consequences:
General overproduction is impossible;
What is beneficial for an individual business entity is beneficial for the economy as a whole;
Imports are beneficial to the economy because they are paid for by its products;
Those forces of society that consume but do not produce ruin the economy.
Say's theory of sales markets led to the idea of internal stability and sustainability of the capitalist economy. Unemployment and declines in production should - on its basis - be interpreted as temporary phenomena of no long-term significance. This view of macroeconomic stability market economy was refuted only in the 1930s.
Conclusion
The classical school developed in the second half of the 18th - first half of the 19th century. The economists of the classical school, who replaced the mercantilists, made a significant contribution to the formation of the foundations of economic science.
The classical school made the sphere of production, not circulation, the main object of study; revealed the importance of labor as the basis and measure of the value of all goods, as a source of society's wealth; proved that the economy should be regulated by the market and has its own laws, which are objective, i.e. cannot be abolished by either kings or governments; identified sources of income for all strata of society.
New concepts, provisions, conclusions, to one degree or another, rely on the works and developments of their predecessors, on the terminology developed by them, systematize and streamline the previously accumulated theoretical wealth.
The classical school laid a weighty foundation for economic theory, which opened the way for further improvement, deepening and development.
The classical school of political economy is one of the mature trends in economic thought that have left a deep mark on the history of economic thought. The economic ideas of the classical school have not lost their significance to this day. The classical direction originated in the 17th century and flourished in the 18th and early 19th centuries. The greatest merit of the classics is that they put labor as a creative force and value as the embodiment of value at the center of economics and economic research, thereby laying the foundation for the labor theory of value. The classical school became the herald of the ideas of economic freedom, the liberal trend in the economy. Representatives of the classical school developed a scientific understanding of surplus value, profit, taxes, land rent. In the depths of the classical school, in fact, economic science was born.
The merits of the classical school:
1. She made the sphere of production, not circulation, the main object of study.
2. Revealed the importance of labor as the basis and measure of the value of all goods, as a source of wealth in society.
3. Proved that the economy should be regulated by the market and has its own laws, which are objective, i.e. cannot be overruled by kings or governments.
4. Identified sources of income for all sectors of society: entrepreneurs, workers, landowners, bankers, merchants.
Mainideasclassicalpoliticalsavingsare:
A person is considered only as an “economic person”, who has only one desire - the desire for his own benefit, to improve his position. Morality, culture, customs, etc. are not taken into account.
All parties involved in an economic transaction are free and equal before the law, and in the sense of foresight and foresight.
Every economic entity is fully aware of prices, profits, wages and rents in any market as in this moment, as well as in the future.
The market provides full mobility of resources: labor and capital can instantly move to the right place.
The elasticity of the number of workers with respect to wages is not less than one. In other words, any increase in wages leads to an increase in the size of the labor force, and any decrease in wages leads to a decrease in the size of the work force.
The only goal of the capitalist is to maximize the return on capital.
There is an absolute flexibility of monetary wages in the labor market (its value is determined only by the ratio between supply and demand in the labor market).
The main factor in increasing wealth is the accumulation of capital. Competition must be perfect and the economy free from excessive state interference. In this case, the "invisible hand" of the market will ensure the optimal allocation of resources.
Bibliography
1. Amosova V.V., Gukasyan G.M., Makhovikova G.A. Economic theory. St. Petersburg: Piter, 2002. 480.: ill. (Series "Textbooks for universities").
2. Bartenev S.A. History of Economic Thought. Moscow: Jurist, 2002.456 p.
3. Bartenev S.A., Economic theories and schools, M., 1996.
4. Blaug M. Economic thought in retrospect. M.: "Delo Ltd", 1994.
5. Voitov A.G. History of Economic Thought. Short course: Tutorial. 2nd ed. M.: Publishing House"Dashkov and Co", 2001. 104 p.
6. Galbraith J.K. Economic theories and goals of society. Moscow: Progress, 1979.
7. Dadalko V.A. World economy: Proc. allowance. M.: "Urajay", "Interpressservis", 2001. 592 p.
8. Jean-Marie Albertini, Ahmed Silem. "Understand economic theories". A small guide to big currents, translated from French, M., 1996.
9. Zhid Sh., Rist Sh. History of economic doctrines. M.: Economics, 1995.
10. Kondratiev N.D. Fav. op. M.: Economics, 1993.
12. Negeshi T. History of economic theory. M.: Aspect - press, 1995.
13. Yadgarov Ya.S. History of Economic Thought. M., 2000.
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Classical school of political economy
classical political Economy(also classical economics) - the first of the modern directions of economic thought. Actively developed at the end of the 18th century - 30s. XIX century. Main authors: Adam Smith, Jean-Baptiste Say, David Ricardo, Thomas Malthus and John Stuart Mill. Following the physiocrats, basic principle promoted economic liberalism. The foundations of the labor theory of value were formulated.
The classical school of political economy arose during the period of the birth and establishment of the capitalist mode of production. In the 16th century in England, in the depths of the feudal system, new, capitalist relations began to develop. Gradually, with the development of manufactories, commercial capital is subordinated to industrial capital. However, mercantilism, which studied the problems of circulation, gives way to the classical school, which transferred research to the sphere of production. The great classical economists A. Smith, D. Ricardo, J.S. Miles laid the foundation for political economy and had a huge impact on the main directions of the further development of economic science. Political economy as a science began with the works of the classical school. It was the classics who made an attempt - and not unsuccessfully - to represent the entire diversity of the economic world as a single whole, to bring into a system individual provisions, conjectures, observations, conclusions, to isolate and agree on categories and concepts.
The history of development
The founder of the direction is A. Smith, his closest followers (“Smithians”) are Dr. J. Anderson, Earl of Lauderdale, T. Malthus, T. Took, Colonel Robert Torrens, Sir E. West and J. H. Marset. Smith laid out a logical system that explained the operation of the free market in terms of internal economic mechanisms rather than external political control.
A new stage in the development of the classical school is marked by the figure of D. Ricardo with his development of the concept of value, original theories of land rent and international trade. D. Ricardo's immediate followers included the English economists J. Mill, J. R. McCulloch, and T. de Quincey; in addition, N. W. Senior and G. Martino are referred to as “Ricardians”. political economy labor cost
The labor theory of value led to the emergence of a group of economists who advocated a class that earned money through labor. These scientists are known in history under the name "Socialists-Ricardians". Among them are T. Godskin, William Thompson (c.1785 - 1833), Charles Hall (1745 - 1825), John Gray (1799 - 1850), John Francis Bray (1809 - 1895).
The final stage of the evolution of the school is represented by the work of J. S. Mill, in whose works the principles of the classical school were finally embodied in economic theory.
In classical economic theory, the economy has the ability to self-regulate and make full use of its resources, and any production is organized in order to increase consumption.
Reasons for the appearance
Prior to the emergence of the foundations of the classical school in economics, society was dominated by the opinion that government intervention into the economy. It was believed that this was the only way to form the wealth and well-being of the state. However, from the end of the 17th to the beginning of the 18th century, ideas of non-intervention of the state in the economic life of society, that is, economic liberalism, were formed.
It was at this time that a new theoretical school of economic thought was born. Later it would be called classical political economy.
Representatives of the classical school re-formulated the subject and method of studying economic theory. The rise of manufacturing (and then industrialization) brought to the fore industrial production, which pushed back trading and loan capital. Hence, the sphere of production came to the fore as a subject of study.
At times Ancient Greece the term "oikonomy" meant "household". In the era of mercantilists, economics began to be understood as the science of the state economy, managed by the monarch. Finally, economics acquired the features of a scientific discipline at the end of the 17th - the first third of the 19th century.
Stages of development
- · First stage. The first period of this stage (mid-17th - early 18th century) is characterized by the expansion of market relations. The theory of mercantilism is debunked. W. Petty and P. Boisguillebert are considered the main representatives of this trend.
- The second period of this stage falls on the middle of the 18th century, characterized by the emergence of such a direction as physiocracy. Among the representatives of this trend, one can single out F. Kene, A. Turgot and others.
Physiocrats significantly advanced economic science, outlined a new interpretation of a number of micro- and macroeconomic categories. But their attention was riveted to the problems of agricultural production to the detriment of other sectors of the economy and especially the sphere of circulation.
The second stage is completely connected with the name of Adam Smith. Among his works, one can single out the monumental work “A Study on the Nature and Causes of the Wealth of Nations” (1776). The basis of his theory was that economic laws unshakable and objective, regardless of the will and consciousness of man. The laws discovered by Smith - the division of labor and the growth of labor productivity - are classical. His interpretation of the commodity and its properties, money, wages, profits, capital, productive labor, etc. underlie modern economic concepts.
- The third stage is the entire first half of the 19th century. In a historical aspect, it correlates with the completion of the industrial revolution in developed countries. During this period, the ideas of A. Smith were deepened and supplemented by a whole group of his followers, among them: D. Ricardo, T. Malthus, N. W. Senior, J. B. Say, F. Bastiat and others.
- The fourth stage is the second half of the 19th century. This stage can be called the final one. This is a period of generalization of the best achievements of the classical school. Prominent representatives of this stage are J. S. Mill and K. Marx. During this period, the formation of "neoclassical economic theory" began.
General information
The most famous and prominent representatives of classical political economy were the Scottish scholar Adam Smith (1723-1790) and the Englishman David Ricardo (1772-1823). A. Smith headed the Department of Moral Philosophy at the University of Glasgow, then worked as the Chief Customs Commissioner for Scotland. He was the author of many works on economics and philosophy. But his main world-famous work was An Inquiry into the Nature and Causes of the Wealth of Nations (1776). In this work, A. Smith gives a comprehensive description of the economic system of society, considers the theory of value, the theory of income distribution, the theory of capital and its accumulation, economic policy states, public finance, gives a detailed critique of mercantilism. He managed in his book to combine most of the existing areas of economic research.
All the economic phenomena considered by A. Smith are based on the labor theory of value. The value of a commodity is created by labor, regardless of the branch of production. The labor embodied in commodities is the basis for exchange. The price of a commodity is determined by the labor costs of its production, as well as by the ratio of supply and demand for the commodity.
A. Smith gave a detailed analysis of the main incomes of society - profits, wages and ground rent - and defined the value of the social product as the sum of the incomes of society. The social product embodies the wealth of the country. The growth of wealth depends on the growth of labor productivity and on the share of the population engaged in productive labor. In turn, labor productivity largely depends on the division of labor and its specialization.
When considering economic phenomena and processes, the "classics" of political economy adhered to a certain system of general premises. Chief among these were the concept of "economic man" and economic liberalism (economic freedom). They considered a person only from the point of view of economic activity, where there is the only incentive for behavior - the desire for one's own benefit.
The idea of economic liberalism was based on the idea that economic laws act like the laws of nature. As a result of their action, “natural harmony” is spontaneously established in society. The state does not need to interfere with the operation of economic laws. The principle of economic liberalism and free trade is expressed by the famous slogan "laissez faire, laissez passer" In other words, it is the principle of non-intervention of the state in economic activity. The expression has become a symbol of classical economic theory. In foreign trade economic liberalism means free trade, no restrictions on exports and imports. Such a foreign economic policy was called free trade (from the English free trade -- free trade).
According to the "classics" of political economy, economic laws and competition act as an "invisible hand". As a result, resources are redistributed for efficient (full) use, prices for goods and resources change rapidly, and a balance is established between supply and demand.
The end of the era of the "classics" of political economy does not mean the end of political economy as a science. On the contrary, as in other sciences, the “classical stage” is only a “high start” life cycle science, opening the next, no less rich pages of its history.
A. Smith entered the history of economic thought as the founder of classical political economy. At the age of 44, he decided to fulfill a grandiose and even monstrous, in the words of some biographers, plan - to give the world a theory of socio-economic structure. After 10 years of complete seclusion, he publishes the book “A Study on the Nature and Causes of the Wealth of Nations” (1776). economic knowledge, thus A. Smith fulfilled the historical task. The main idea in Smith's teaching is the idea of liberalism, minimal government intervention in the economy, market self-regulation based on free prices, which are formed depending on supply and demand. He called these economic regulators the "invisible hand". Smith laid the foundations of the labor theory of value, showed the importance of the division of labor as a condition for increasing its productivity, created the doctrine of income, clearly formulated the principles of taxation, and much more. His research has become like a bible for Western economists.
David Ricardo continued to develop the theory of A. Smith, overcoming some of the shortcomings of his teaching. His main work is “The Principles of Political Economy and Taxation” (1809-1817). It is worth noting that he showed that the only source of value will be only the labor of the worker, which is the basis of the incomes of various classes (wages, profits, interest, rent ); profit is the result of the worker's unpaid labor; formulated the laws of inverse proportion between salary and profit, revealed the mechanism differential rent. His teaching formed the basis of English utopian socialism.
The mistakes of the classical school were repeatedly pointed out by Russian economists in the late 19th and early 20th centuries. So, V.Ya. Zheleznov narrated that the classical school clothed ϲʙᴏ and positions in an absolute formula, considered ϲʙᴏ and theoretical conclusions suitable for explaining economic phenomena of all times, countries and peoples. A major shortcoming of classical political economy was ignoring the role of the state in economic life.
The prominent economist of those times Nikolai Semenovich Mordvinov (1754-1845) and the famous statesman Mikhail Mikhailovich Speransky (1772-1839) can be considered Russian representatives of the classical economic school
Mordvinov N.S. - statesman and public figure, president of the Free Economic Society, admiral, naval minister, count, the only member of the Supreme Criminal Court who refused to sign the death warrant for the Decembrists. He advocated the creation of a developed industry in Russia, turning it into a powerful agrarian-industrial country, strengthening the economic role of the nobles, the use of forced labor of serfs in industry, the need for industrial protectionism for Russia. The latter distinguished the economic views of Mordvinov from the teachings of Adam Smith. His entire extensive economic program, in essence, meant clearing the way for the development of capitalism in Russia. Mordvinov prepared monetary reform 1830-1843, theoretically proved the need for the devaluation of the Russian monetary unit.
A certain stage in the evolution of world economic thought was the work of the Swiss economist and historian Jean Charles Léonard Simond de Sismondi (1773-1842). It is worth noting that he studied at the University of Geneva. Lived in France, Great Britain, Italy. His main work is New Principles of Political Economy (1819). It is worth noting that he criticized the economic mechanism of capitalist society. Sismondi placed distribution at the center of economic doctrine, on which consumption and production depend. He believed that political economy is called upon to be the science of improving the social mechanism for the sake of human happiness.
The idea of creating a future society, each in its own sense, was put forward by utopian socialists Claude Henri de Rouvroy Saint-Simon
(1760-1825), Charles Fourier (1772-1837) - France and Robert Owen (1771 -1858) - Great Britain. It is worth noting that they criticized capitalism and demanded the reorganization of production, distribution and consumption, the abolition of private property, the elimination of the opposition between mental and physical labor, the establishment of a fair social system. The last Saint-Simon called industrialism, Fourier - harmony, Owen - communism. It is worth noting that they were against the revolution and the political struggle.
