2017-11-30
594
Economics as a science has its roots in the early Greece and Rome.But it was not considered a separate discipline until the 19th century. The Scottish philosopher Adam Smith is often named as the father of modern economics. In 1776 Adam Smith published his work «The Wealth of Nations». Adam Smith represents the first school of economic thought - The Classical School. The main idea of the Classical school was that markets work best without interference ofgovernment. The economic system is a self-regulating mechanism, and the price mechanism acts as a powerful 'invisible hand' to allocate resources.
The great English economist Lord John Maynard Keynes argued that the economic system was not self-adjusting.Without continued government intervention itcouldn’t achieve full employment. That’s why Keynes advocated government’s use of fiscal and monetary policies to stimulate economic demand and growth andmitigate the negative effects of recessions and depressions.
Changes in economic thought have always accompanied changes in the economy. Contemporary economic thought deals largely with the issues of globalization and the emergence of a global economy.
Questions on the topic:
1) Where did economic thought originate?
2) What did it deal with first?
3) What economic issues did Aristotle and Thomas Aquinas examine?
4) Who is considered to be the father of modern economics? What first school of economics did he and his followers represent?
5) What work did Adam Smith publish in 1776?
6) Did the representatives of the classical school advocate interference of government into economy? How did they view the economic system?
7) Who was the first to challenge Smith’s doctrine?
8) Did Keynes view the economic system as a self-adjusting mechanism?
9) What shouldgovernment’s use of fiscal and monetary policies be aimed at according to Keynes?
10) What issues does contemporary economic thought largely deal with?
