Hisotry of Economics

It is debatable whether economics should actually be defined as being a science. A science like math or physics usually gets its satisfaction from proving something to be irrevocably true. Solve a complex equation and QED that’s the answer, there’s no argument. Economics on the other hand will rarely give us a simple answer. Ask 5 economists a question and you’ll get 6 different answers.

Yet economics could make claim to be a science even if, as John Ruskin disdainfully called it “…the Science of getting rich” (Ruskin 1). Over the years economics has also managed to adopt the equally unflattering label of “the Dismal Science” - perhaps fitting for a subject where even the leading theorists can fail to agree.

We could say economics began as soon as hunter men began to exchange their captured prey with other cavemen. But generally the science of economics did not begin to be formalised until fairly late. However, over the past two centuries, the science of economics has seen no shortage of colourful characters all offering their solutions and diagnoses of the economic problem. This is a small selection of some of the economists who have shaped the subject (for good or ill).

The Dismal Prophecies of Malthus

One of the first economists to proffer his theory was T.Malthus. Malthus is chiefly remembered for his essay on population. In this essay, Malthus argued the human race was doomed because the population was increasing at a faster rate than our capacity to grow food. In many ways Malthus was one of the earliest proponents of “The End Is Nigh” syndrome, and unsurprisingly it was Malthus who claimed for economics the label “The Dismal Science”. Fortunately, Malthus displayed a trait that many later economists would share - he was wrong. The population didn’t starve. In fact during the nineteenth century the forces of capitalism flourished creating unprecedented wealth- at least for those who owned the means of production.

Adam Smith - The Invisible Hand

One of Capitalism’s strongest exponents was the economist Adam Smith. In his book, The Wealth of Nations, Smith claimed that if people followed their own self interest, then these individual acts of selfishness would have the remarkable effect of leading to the greatest overall benefit for society. This is the basic principle of the book, although Adam Smith did take 1,260 pages to say it (unfortunately, very few economists have ever learnt the art of being concise). Adam Smith has thus become synonymous with support for free market economics.

However, many people forget he was rather a modest Scottish intellectual who became chair of Moral Philosophy at Glasgow University (Smith’s other major work was about charity and ethics but it is for his articulation of free market economics that he is chiefly remembered). His seemingly paradoxical argument about the free market has remained at the centre of all major debates in economics. Is an unbridled free market really the best economic system? Nevertheless, even the most ardent free market economist cannot ignore the fact that capitalism creates inequality and in the nineteenth century this inequality was painfully evident. Thus, many economists came along to challenge the free market ideologies of Adam Smith.

Yet if kids are to learn about science and write up their mathematical finds in their science fair project's report, then they need to understand the history of economics...so let's move on to the the present...