You are on page 1of 5


History of Economic Thoughts

Outline of Assignment Topic Page#

Justification & Scope History of Economic Thoughts Early Economic Thoughts Classical Economic Thoughts Neo-Classical Economic thoughts New Institutional Economics Methodology Parameters Conclusion & Recommendation Reference

2 2 2 3 3 4 4 5 5 5

Page | 1

Justification & Scope

The history of economic thought that mean different thinkers and theories from the ancient world to the present day, The history of economic thoughts is meant that different thinkers give their own theories to support the economy of the country, It mean the ideas of different thinkers in the economic system, that the thinkers think with different ways, try to do develop economic growth and good market with many aspects, demand and supply, behavior of people, industrialization, etc.

History of Economic Thoughts

This term Economic coined around 1870, The history of economic thought which mean different thinker gave their thoughts from the ancient world to the present day, mean how changing in economics, from ancient to present day. There are many thinker in the history of economic thoughts, every one gave their own theory and criticized by new thinker or theories with new develop ideas in economic development.
There are three phases in history: 1) Early economic thought 2) Classical economics thought 3) Neo-Classical Economics thoughts

In early economics, there is Aristotle, Plato, and Thomas Aquinas

Aristotle analyzed the economic processes surrounding him and endeavored to delineate the place of economy within a society that included commercial buying and selling, he said in the first sentence of this work that politics does not naturally have one leader, while a household does, and he said that give the value to exchange and store more money to strong the economic and after PLATO he said that there should be Division of labor, individual subordinate to the state, and he said that the state arises out of the needs of the people and that the state should be interpreted as the body of its inhabitants and the “THOMAS AQUINAS”
Page | 2

he talked about the concept of a just price, which he considered necessary for the reproduction of the social order, he against any form of cheating and recommended compensation always be paid in lieu of good service.

After this in Classical Economics, there is Adam Smith, Thomas Malthus and David Ricardo

Adam Smith said that the economic is an inquiry in to the nature and cause of wealth of nation and he wants industrial development, he is considered the founder of modern economics, he realize the division of labor is impacted by the scale of the market for product, he said that in economic development reaction of behavior is most important and economic development depend the Demand and Supply and Robert Malthus he interested in everything about population, said that human does not do the overpopulation, he said people should do reduce the overpopulation, he said there is relationship between food supply ad population, if there is increase population then there will be reduce resources and economic will not develop, so keep do not overpopulation. David Ricardo he interested in stock market, he want to wealthy stock market trader, he best known in political Economy and Taxation, he made a distinction between the workers, who received a wage fixed to a level at which they can survive, he said if population grows then there is the need to increase cultivated Land, he said wage fixed that people survive after this the Karl Marx, he talked about feudalism capitalism communism and he castigated the capitalist system, its great influence on contemporary social and political developments, evolutionary and revolutionary alike, mostly his theory is called socialist theory, he want to social change between social class, that poor people also get equal right, want social and political development, Industrial revolution

After this Neo-Classical Economics, there is Alfred Marshall, J.B. Clark

Neoclassical economics refers to a general approach in economics focusing on the determination of prices, outputs, and income distributions in markets through supply and demand, All societies eventually develop through a linear and progressive series of complex social processes as they move from industrialization to urbanization, and, finally, to modernization. ALFRED MARSHALL, He rejected the traditional definition of economics as the "science of wealth" to establish a discipline concerned with social welfare, he emphasized
Page | 3

that the price and output of a good are determined by both supply and demand, he said economics is a science of human behavior After this there is J.B. Clark, he found marginality revolution; Labor, Capital, and Land are paid according to their “economic contribution to the social product, his want rapid industrial development and distribution of wealth, he describe unchanging society where perfect competition led to economic equilibrium

After this all phases now here is NIE New Institutional Economics

The term 'new institutional economics' was coined by Oliver Williamson in 1975, New institutional economics (NIE) is an economic perspective that attempts to extend economics by focusing on the social and legal norms and rules that underlie economic activity and with analysis beyond earlier institutional economics and neoclassical economics, They work within a modified Neoclassical framework in considering both efficiency and distribution issues, in contrast to "traditional," "old" or "original" institutional economics, which is critical of mainstream neoclassical economics, NIE has its roots in two articles by Ronald Coase, "The Nature of the Firm" (1937) and "The Problem of Social Cost" (1960). In the latter, the Coase Theorem (subsequently so termed) maintains that without transaction costs alternative property right assignments can equivalently internalize conflicts and externalities. Therefore, comparative institutional analysis arising from such assignments is required to make recommendations about efficient internalization of externalities and institutional design, including Law and Economics, at present NIE analyses are built on a more complex set of methodological principles and criteria, It has developed as a movement within the social sciences, especially economics and political science that unites theoretical and empirical research examining the role of institutions in furthering or preventing economic growth. It includes work in transaction costs, political economy, property rights, hierarchy and organization, and public choice

Page | 4


Primary data and on the experience based Primary data: is come through market behavior and society behavior Experience based: write on the experience based, solve the problems in economic, public opinion


      

Economic Growth Social change Change in behavior Control overpopulation Demand & Supply Development in economy Industrialization

Conclusion & Recommendation

In the history if economic there are many thinker give their own ideas to improve the economic development and in the history many author play good role in economy to improve the economic growth through these author control on overpopulation, increase in industrialization, change in the behavior of common people, division of labor, improve the market laws, and so many.


Submitted By: Zulfiqar Ali Shah M.Phil Student 0300-5310821

Page | 5