Economic thinking

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  • 6 BCE

    Economic thinking

    (VI a.c. – XVI) Grecia, Roma y Edad Media
  • Period: 16 to 16

    Mercantilism

    Mercantilism and its ideas developed in Europe between the XVI and XVII centuries and the first half of the XVIII century. One of its fundamental pillars was the belief that countries that wanted to maintain a relevant position in the international context and develop their power, should accumulate wealth (mainly in the form of gold and other precious metals).
  • Period: 16 to 16

    Rise and decay of mercantilism

    As current of economic thought had its maximum expression in France in the sixteenth century under the command of Jean Baptiste Colbert, finance minister of Louis XIV.
  • Period: 16 to 16

    The main mercantilist schools

    Bullionism: promulgates the accumulation of wealth through precious metals. It was developed during the XV and XVI centuries.
    Colbertism: proposes the industrialization of the economy as a source of wealth. It is also called French mercantilism.
    Commercialism: proposes foreign trade as a source of wealth, known as British mercantilism.
  • Period: 18 to 18

    Physiocrats (XVIII)

    During the second half of the eighteenth century, some European countries lived a difficult economic situation. The economic recession accentuated social conflicts, which was a breeding ground for insurrections and violent revolts.
  • Period: 18 to 18

    Physiocrats (XVIII)

    En consecuencia, los fisiócratas señalaban que las leyes humanas, y, por tanto, las económicas, debían estar en armonía con las leyes de la naturaleza. Se derivaba que la agricultura es la base de una economía fuerte y que en el sector primario la naturaleza permitía que el producto obtenido superaría a los insumos invertido. Para los fisiócratas, otras actividades,quedaban en un segundo plano.
  • Period: 18 to 18

    Physiocrats (XVIII)

    For the physiocrats, it was an indispensable element to develop strategies of a macroeconomic nature, in such a way that it generated a coherent order, not only in the economic sphere, but also in the social and political one. For the defenders of this theory, economic development and social development were absolutely indissoluble elements.
  • Period: 18 to 19

    Classics (XVIII - XIX)

    The classics emphasized the benefits of free trade and developed an organized analysis of the value of goods and services as a reflection of their cost of production. The classics emphasized the benefits of free trade and developed an organized analysis of the value of goods and services as a reflection of its production cost.
  • Period: 18 to 19

    Classics (XVIII - XIX)

    The beginning of this economic thought is usually fixed in the year 1776, when Adam Smith's work "An investigation on the nature and causes of the wealth of nations" was published. Its subsequent development was marked by a time when capitalism was the dominant economic system and the industrial revolution generated important socio-economic changes. See origins of the economy.
  • Period: 18 to 19

    Classics (XVIII - XIX)

    Some of the economists associated with classical economics are: Adam Smith, Jean Baptiste-Say, David Ricardo, Francois Quesnay, Thomas Malthus, Frederic Bastiat and Joan Stuar Mill.
  • Period: 18 to 18

    Classics (XVIII - XIX)

    The free market will result in an optimal allocation of resources.
    The government should not intervene in the operation of the market.
    Prices adjust naturally upwards or downwards (including wages) for markets to achieve their equilibrium.
    Monetary policy is ineffective.
    Fiscal policy is ineffective.
    The value of a good is determined by the amount of work that is used to produce it.
  • Period: 19 to 19

    Classics (XVIII - XIX)

    Classical economics is a school of economic thought that is based on the idea that the free market is the natural way of functioning of the economy and that it produces progress and prosperity
  • Period: 19 to 19

    Marxists (XIX - XXI)

    El Marxismo es el conjunto de doctrinas derivadas de la obra de Karl Marx, filósofo y periodista alemán, y de su compañero Friedrich Engels, quien le ayudó en muchos de los avances de sus teorías.
  • Period: 19 to 19

    Marxists (XIX - XXI)

    The main argument on which the Marxists are based is that capitalism is an erroneous economic structure and that it must be replaced by another that will abolish the bourgeois property system and the free market of goods and services. According to Marx, the key problem of capitalism is that it generates the exploitation of workers.
  • Period: 19 to 19

    Marxists (XIX - XXI)

    Marxists believe that capitalist economies are fueled by crises that tend to stimulate them. Marx believed that this dependence on economic depressions could wreak havoc in the long term, and therefore, advocated for a planned community to replace such a system.
  • Period: 19 to 21

    Marxists (XIX - XXI)

    Marxists claim that communism as a supposed final dialectical state provides more freedom than other economic systems and that the redistribution of wealth will solve many problems. Marx proposes the use of state institutions for example, the use of taxes to finance the purchase and distribution of means of production to workers who, over time, will form a market of perfect competition.
  • Period: 20 to 20

    Neoclassical (XIX-XXI)

    Neoclassical economics is a school of economic thought that is based on the idea that the value of goods is a function of the utility or satisfaction that consumers assign to it.
  • Period: 20 to 20

    Neoclassical (XIX-XXI)

    The neoclassical school emerged in the 1870s. The term neoclassical is very criticized by some economists, arguing that it seeks to agglutinate the marginalist economic thought that existed between 1870 and 1920, which tried to formalize the economy to assimilate it in a more mathematical way.
  • Period: 20 to 20

    Neoclassical (XIX-XXI)

    One of the main concerns of the neoclassicals was the allocation and optimal distribution of resources in a society. In addition, they strongly supported free trade as an engine of economic development and as a firm to take advantage of the comparative advantages of the countries.
  • Period: 20 to 20

    Neoclassical (XIX-XXI)

    The origins of neoclassicism are found in the ideas of marginal economists who sought a more rigorous economic theory based on objective mathematical models and away from historical determinants.
  • Period: 20 to 20

    Neoclassical (XIX-XXI)

    English: related to William Stanley and Alfred Marshall, greatest exponent of neoclassicism.
    Austrian: associated with Carl Menger, who developed the foundations of marginal analysis.
    French: where Leon Walras stands out, who developed the theory of general equilibrium and the concept of marginal utility.
  • Period: 20 to 20

    Neoclassical (XIX-XXI)

    The neoclassicists focused their analysis on the choice between several alternatives, the marginal changes as an object of calculation and the general equilibrium.
    People seek to maximize their utility or satisfaction when they consume goods or services. Companies seek to maximize their profits when they sell goods or services.
    People and companies act independently based on complete and relevant information.
  • Period: 20 to 20

    Neoclassical (XIX-XXI)

    Theory of value: classical economists considered that the value of goods and services was determined by the cost of the factors. The neoclassicists, on the other hand, pointed out that the value was determined by the utility it reported to consumers and its relative scarcity. In this way, to greater utility, consumers would be willing to pay more. On the other hand, the scarcer is a good, the more valuable it will be.
  • Period: 20 to 20

    Neoclassical (XIX-XXI)

    Formation of prices and income distribution: The neoclassicals reneged on this analysis and considered that the supply and demand of factors determined their prices. In this way, the equilibrium in the factor market determines the income and its distribution among the economic agents that own the factors of production.
  • Period: 20 to 20

    Neoclassical (XIX-XXI)

    One of the fundamental aspects that differentiated neoclassicism from the classical school is the way in which they explained prices and the relative value of goods. According to the classical school, the value of the goods is explained by their costs (on the supply side). For neoclassicists, on the other hand, the value of goods is explained by marginal utility, that is, the value that is assigned to the last unit consumed (on the demand side).
  • Period: 21 to 21

    Keynesians (XX -XXI)

    In conclusion, Keynesianism is based on stimulating demand to cause an increase in consumption and employment in times of crisis. And how is demand stimulated? Through monetary and fiscal policies. Keynes was in favor of using fiscal policies. Although in the late twentieth century, the debts of Western countries began to grow in such a way that the Keynesianists began to recommend monetary policies as a mechanism to stimulate demand.
  • Period: 21 to 21

    Keynesians (XX -XXI)

    keynesEl Keynesianismo es una de las teorías económicas más conocidas, su principal característica es que apoya el intervencionismo como mejor manera para salir de una crisis. Debe su nombre al economista británico John Maynard Keynes, que centró su carrera en estudiar los agregados económicos y los ciclos económicos.
  • Period: 21 to 21

    Keynesians (XX -XXI)

    This economic discipline produced an authentic "Keynesian revolution," which shelved classical economic thinking, based on liberalism and laissez faire. Keynesianism proposed a solution for capitalism's greatest enemy, economic cycles. He proposed to stimulate demand and regulate the economy in times of depression. Keynes studied problems in the economy, such as unemployment, investment, consumption, production and savings in a country. His arguments built the basis of Macroeconomics.
  • Period: 21 to 21

    Keynesians (XX -XXI)

    Keynesianism is based on State interventionism, defending economic policy as the best tool to get out of an economic crisis. Its economic policy is to increase public spending to stimulate aggregate demand and thus increase production, investment and employment.
  • Period: 21 to 21

    Keynesians (XX -XXI)

    Unemployment is one of the main problems of the crisis, Keynes argued that unemployment does not exist due to the scarcity of resources, but because of the scarcity of demand, which causes that it is not consumed enough to have to produce a quantity of goods that work to all. In other words, the problem of unemployment is the lack of demand and not the lack of resources. Unemployment also arises because of the rigidity of wages to the bottom.
  • Period: 22 to 22

    Liberalism (XX-XXI)

    The economic liberalism has origins in the eighteenth century in response to the privileges of the nobility that contributed to society and mercantilism, defended the intensive intervention of the State in the economy. The forces of supply and demand are natural, they will take us to a balance where prices reflect the relative scarcity of goods and produce an efficient allocation of resources. The free initiative of people or companies and the search for income drive growth economic.
  • Period: 22 to 22

    Liberalism (XX-XXI)

    Economic liberalism drives development, creativity and innovation. People and companies have the incentives to compete and look for ways to achieve their goals.
    Advocates say that thanks to free trade, consumers can enjoy a greater variety of products and services at a more accessible price due to competitive pressure.
  • Period: 22 to 22

    Liberalism (XX-XXI)

    François Quesnay, a French economist, was one of the first liberals, according to him, agriculture was the only really productive activity and this had to be exercised with complete freedom (prices, company, cultivation, etc.).
  • Period: 22 to 22

    Liberalism (XX-XXI)

    The true forerunner of economic liberalism was Adam Smith, English economist, who in his book "The Wealth of Nations" of 1776, developed the idea of "invisible hand" which is that individuals, seeking their own benefit, push the economy to an optimal balance that promotes social welfare without the intervention of the State.
  • Period: 22 to 22

    Liberalism (XX-XXI)

    One of the most influential authors of economic liberalism in the 20th century is the Austrian author Ludwig von Mises, who argued that State intervention leads to a result that is not natural for a society and therefore ends up being harmful to society and society. introduces chaos.
  • Period: 22 to 22

    Liberalism (XX-XXI)

    Friedrich Hayek is another influential author of economic liberalism, was a disciple of Ludgwig Von Mises in the Austrian school. He was a harsh critic of the planned economy and socialism. He argued that economic cycles are a consequence of the intervention of central banks, through their monetary policies.
  • Period: 22 to 22

    Liberalism (XX-XXI)

    Economic liberalism is based on a set of essential ideas.
    The free interaction of supply and demand balances production and consumption.
    State interventions break the natural balance of supply and demand generating inefficiency.
    The role of the State should be limited to ensuring compliance with agreements and contracts freely established by individuals and companies. This idea is associated with the concept of "Laissez Faire, laissez passer", the State should limit itself to "letting go"
  • Period: 22 to 22

    Liberalism (XX-XXI)

    Economic liberalism is a doctrine that states that the best way to achieve economic development and efficiency in the allocation of resources is through a free market without the intervention of the State (regulations, taxes, etc.)