Theories of classical economics

We will return to problems after we make a classical economics study on economic growth using the concept of national "wealth." It is quite clear that the developments and growth was present, especially in the mainly macroeconomic theories. The mercantilism, under its different versions, can be defined as a theory centered on the idea of supporting the mission of a state in enriching the country and economic agents through foreign trade businesses such as bringing as many precious metals in the country.[1]

Adam Smith's analysis of mercantilism emphasizes its primary limit: "A country without its gold mines, without doubt acquire its gold and silver from foreign countries, as a country without vineyards has to import wine. It does not seem, however, the need that government attention to move more towards a goal, than to the other. A country that has means to purchase wine always will acquire the appropriate wine and a country that has means to purchase gold and silver will never lack these metals. It will buy at a price as for any other goods."[2]

If a country's wealth consists, after the mercantilist, in the amount of gold and silver available, it means that any economic growth is based on increasing the amount of gained precious metals. The physiocrats call into question a new perspective that of productive labor (the farmers) made in agriculture. Wealth is, in fact, a creation of nature, which is "the only source of value."[3]

The one who founded the theory of economic growth was A. Smith. In his work The Wealth of Nations, Smith clarified his scope of interest as "research on the nature and causes" of wealth. Wealth is no longer regarded as mere possession of goods but diversified, as a multifunctional power. "Wealth (... ) is power. But the people who acquire or inherit a large fortune do not go through the property, immediately to political power, civil or military. Its wealth perhaps gives him the means to acquire and one to the other, but the mere possession of wealth does not necessarily transmit it. The power which the possession immediately and directly send him the buying power: power to dispose of work or the work product."[4] If we ask - as it is normal in a scientific approach, how can we interpret these classical economic analysis we can - we believe - to relate to the topic discussed on the history of economic thought. We are dealing with the vision that we have called it with the word "economy without man," i.e. an approach to business processes "as" producing goods (goods, services), the man being only an "assumption" about that process "is made by" someone.

A certain explanation we could advance, even in the role of a working hypothesis, a hypothesis that we can judge critically. "Classical Economics" (including A. Smith) was developed in pre-industrial stage of capitalism (i.e., during manufacturing economy), when social relations were relatively slow to change, without removing the large area and large social conflicts "unlocks" the human situation.

The Industrial Revolution and the analysis of growth and development

The Industrial Revolution (1750-1790) sparked the major socio-economic changes that led to the ruin of small farmers in the villages (especially England), put on the forefront the social problems of unemployment, the poverty of a part of the population, the inequality, etc. Man becomes a "factor" that attracts attention. Economy is not just refers to "work" but the man who works. So we can move to the stage of "economy marked by expression of man."

The economic growth, seen only in terms of "wealth" was not about the human situation (as a member of society). As Reich had shown "common image of a national economy whose members succeed or fail together would be a novelty for someone who lived not long ago of the eighteenth century even in Europe, where national state idea gained the most ground. Previous to the 16th century few people of the state or political thinkers saw the nation as responsible in any way, or necessarily linked to economic welfare of its people. National wealth is related only to sovereign wealth - the kings, queens and their entourage invented; financed and plotted a variety of wealth accumulation plans to wage wars abroad and to increase power and prestige. Patriotism meant the devotion to the monarch and not to fellows."[5]

An important factor in creating the idea of "civic welfare" has been a transition to democracy. Throughout the eighteenth century, the word <<patriot>> began to be increasingly used in England and the continent. He designated the 'one who, in a democracy, loves his country (...) or, more precisely, the communal welfare.*[6]

  • [1] Ivanciu, Nicolae-Väleanu (1992), Istoria gándirii economice. Bucharest: Didactic and Pedagogical Publishing House, 20.
  • [2] Smith, Adam (1962), Wealth of Nations, Research on the Nature and its Causes. Vol. l. Bucharest: Academy Publishing House RSR, 296.
  • [3] Poulon, Frederic, op. cit., 52.
  • [4] Smith, Adam, op. cit., 24.
  • [5] Reich, Robert (1996), Nations Work. Bucharest: Paidea, 12.
  • [6] Ibidem, 21 (*- cited from Brunot)
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