Four Central Theories of the Market Economy: conception, evolution and application

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Cover Half Title Title Page Copyright Page Dedication Contents Detailed contents Illustrations Acknowledgments Introduction The invisible-hand proposition The theory of comparative advantage The law of markets The quantity theory of money Further reflections on the four theories Bibliography Chapter 1: The invisible-hand proposition Chapter contents 1. Introduction 2. The theory of market before Adam Smith 2.1. From antiquity to the sixteenth century 2.2. From the sixteenth to the eighteenth century 3. Self-love and the invisible hand 3.1. Hobbes’ challenge 3.2. Early responses to Hobbes 3.3. A tale of two literary works 3.4. The economic response 4. Smith’s method of inquiry 5. Smith’s contribution to the economic response 6. Smith and his contemporary philosophers on the invisible hand 7. Self-interest versus benevolence 8. The invisible-hand passages in Smith’s writings 9. Interpretations, qualifications, and objections 9.1. The classical interpretation 9.2. The neoclassical interpretation 9.3. The evolutionary interpretation 10. The invisible hand and the science of complexity 11. A final note Appendix I: the invisible hand and the theory of natural selection Appendix II: the invisible hand of science Appendix III: other interpretations of the invisible hand Notes Bibliography Chapter 2: The theory of comparative advantage Chapter contents 1. Introduction 2. Theories of foreign trade before David Ricardo 2.1. From classical antiquity to the sixteenth century 2.2. The era of mercantilism 2.3. The eighteenth century – laying the foundation 2.4. Henry Martyn 2.5. David Hume 2.6. Adam Smith 3. Formulation and articulation of comparative advantage 3.1. David Ricardo’s model of comparative advantage 3.2. James Mill 3.3. John Stuart Mill 4. Comparative advantage and free trade 5. Extension and evolution of the Ricardian comparative advantage 6. Empirical studies of the Ricardian comparative advantage 7. A final note Appendix I: a model of comparative advantage based on the writings of Adam Smith Appendix II: how comparative costs ratios set limits on wages Appendix III: Mountifort Longfield’s generalization of the Ricardian model Appendix IV: Haberler’s multi-goods case of comparative advantage Notes Bibliography Chapter 3: The law of markets Chapter contents 1. Introduction 2. Components of the law of markets 3. Before Jean-Baptiste Say 4. The evolution of the law of markets in the nineteenth century 5. The law of markets in the twentieth century 6. A final note Appendix: components of the law of markets A1. Andrew Skinner A2. William Baumol A3. Steven Kates Notes Bibliography Chapter 4: The quantity theory of money Chapter contents 1. Introduction 2. The quantity theory of money before David Hume 3. Richard Cantillon, Montesquieu, and David Hume 4. Adam Smith, David Ricardo, and John Stuart Mill 5. Alfred Marshall, Irving Fisher, and Knut Wicksell 6. John Maynard Keynes and Milton Friedman 7. A final note Notes Bibliography Index