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:
“History does nothing; it does not possess immense riches, it does not fight battles. It is men, real, living, who do all this.... It is not “history” which uses men as a means of achieving—as if it were an individual person—its own ends. History is nothing but the activity of men in pursuit of their ends.”
—Karl Marx (1818–1883)
“This above all makes history useful and desirable: it unfolds before our eyes a glorious record of exemplary actions.”
—Titus Livius (Livy)
“The history is always the same the product is always different and the history interests more than the product. More, that is, more. Yes. But if the product was not different the history which is the same would not be more interesting.”
—Gertrude Stein (1874–1946)