Famous Economists

Adam Smith:

Many consider Adam Smith to be the founder of modern economics. In his book published in  1776, An Inquiry into the Nature and Causes of   the Wealth of Nations, Smith destroyed the   mercantilist argument that a nation’s wealth   comes from amassing gold and silver from a   favourable balance of trade. Rather, Smith   thought that the wealth of nations comes from   the productivity of its resources, productivity that is increased through   specialization. He also came up with the famous radical principle that an   individual pursuing his or her self-interest provides opportunities for others,   and that in pursuing self-interest individuals act as if guided by an “invisible   hand” to promote the well-being of society. When Ronald Reagan was elected   president, many of his supporters wore Adam Smith neckties to inaugural   festivities.

Thomas Malthus:

While Malthus was an excellent economist in the early 19th century in England, he is most famous  today for an idea most modern economists  reject. That idea is that any material progress in  society will be destroyed by a rise in population   brought on by this increase in prosperity. Malthus   was one of the first “Doomsdayers.” This idea led  Thomas Carlisle, a contemporary of Malthus, to  label economics, “The Dismal Science.” 

Those predicting collapse of society today due to overexploitation of natural resources are often called neo-Malthusians.

David Ricardo:

After David Ricardo made his fortune in the financial markets of mid- century England, he turned to economics. His  19th most important contribution was the principle of  comparative advantage. This powerful and not   obvious principle is that everyone has a comparative  advantage in some activity, the activity they are  “least worst at.” According to Ricardo, if everyone  specializes in the activity in which they have a comparative advantage, and then trades with others, all will be made better off. The principle of comparative advantage is often invoked by economists when they note the benefits of free and open markets within a country and across borders as well.

Karl Marx:

Karl Marx was the intellectual founder of the political-economic system called communism. Marx predicted that economic crises would become more and more severe and that working people would eventually rise up in revolution against their bosses. In spite of flaws in his theory, and lack of evidence regarding his predictions, his ideas remain popular throughout the world. The writings of Marx serve as the foundation for a radical, heretical offshoot of economics called Marxian economics. Marxism is still officially popular in countries such as China, Cuba, and North Korea.

Alfred Marshall:

Alfred Marshall taught at Cambridge University in England in the first part of the 20th century. He was one many economists at that time who contributed to the “marginalist revolution” in economics, which was about the idea that economic decisions involved weighing the benefits and costs of incremental moves. In economics courses one soon becomes very aware of the fact thateconomists consider the word “marginal” the most important one in the dictionary.

John Maynard Keynes:

Many would argue that Keynes was the most influential economist of the century. If not the most influential, he was surely the most colorful. He 20th was a member of the famous bohemian and anti- Victorian intellectual circle called the Bloomsbury   group, which included such characters as Virginia Woolf, Lytton Strachey, and E.M. Forster. In his book The General Theory of Employment, Interest, and Money, published during the Great Depression, Keynes argued for active action by the government to increase spending of money they didn’t have. His legacy is something called Keynesian Economics, which advocates the use of government spending and taxation to stabilize the economy. Liberals love Keynes. Conservatives have trouble saying the word Keynes without a sneer on the face, even though Keynesian policy is almost irresistible to a politician of any political flavour.

Kenneth Arrow:

How should we make collective, social decisions? What rules should we follow? Economists before Arrow had done a good job of explaining the rules for rational individual choice, but had not done much in the area of collective choice. Arrow, a Nobel Prize winner in economics, developed the theory that is often called the Arrow Impossibility Theorem. All sciences have impossibility theorems, but until Arrow, economics didn’t have an impossibility theorem. Arrow proved that NO method of social or collective choice existed that could satisfy reasonable axioms of individual choice. His efforts have stimulated enormous research into the theory of social choice.