Four of the Major Economists' Theories

Four of the Major Economists' Theories

“Economics is the science which studies human behavior as a relationship between end and a scarce means which have alternative uses’ seems to capture the essence of Microeconomics, but does not convey much of the spirit of Macroeconomics.”

- L. Robbins

Although most economists cannot come to agreement on the definition of economics, the preceding quote from l. Robbins, in my opinion, seems to just about sum it up. Since the beginning, when man first had to choose between hunting and sleeping, there was economics. Today economics is in everything we buy, use, and make, from the gas in our cars to the food on our tables, economics plays a vital role with the manufacture, distrubution and consumption of each. To help us better understand the economic trends, certain men have become economist. In this paper I will revisit four of the major economists’ theories. Starting with the theories of Adam Smith, a philosopher well as an economist, to the modern (relatively) day theories of Milton Friedman, a Nobel Prize awardee, we will chronologically review the theories of Adam Smith, Karl Marx, John Maynard Keynes, and Milton Friedman.

“Man is an anxious animal.”

-Adam Smith

Adam Smith was one of the first economists of modern times. By modern time I mean post 1700’s and post mercantilism. This particular period in time is commonly referred to as the Age of Enlightenment. Enlightenment thinkers felt that change dictated by reason was essential for humanities’ continuation. Smith, of Scottish origin is best know for his book The Wealth of Nations in which he wrote his most famous theory of the Invisible Hand and not only educated but delighted ...

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...2. Milton Friedman and Anna J. Schwartz, A Monetary History of the United States, 1867-1960 (Princeton: Princeton University Press, (1963), p. 310

3. Robert Lekachman, A History of Economic Ideas (McGraw-Hill)(1959), p. 71-130, 198-226, 331-354

4. Graham Bannock, R.E. Baxter & Ray Rees, The Penguin Dictionary of Economics (Penguin Books., Ltd., 1972)

5. Bruno Leone, Capitalism: Opposing Viewpoints (Greenhaven Press., Inc., 1986), p.20-28

6. Paul R. Gregory, The Essentials of Economics 5th Ed. (Pearson Education, Inc, 2002)

7. Unnamed, Milton Friedman, (Encyclopedia Britannica Inc., 2002)

8. Unnamed, Adam Smith, (Encyclopedia Britannica Inc., 2002)

9. Unnamed, Karl Marx, (Encyclopedia Britannica Inc., 2002)

10. Unnamed, John Maynard Keynes, (Encyclopedia Britannica Inc., 2002)

11. Milton Friedman, The Impact of The Union, (New York: Harcourt Brace, 1951)