Economic History 2400-ZU2HE

I. Introduction

1. Economics and its history
Economics as a science. Benefits from studying the history of thought.

2. Early economic thought
Xenophon and economics. Aristotle: economics vs. chrematistics; exchange, money and value; justice in exchange and distribution. Thomistic economics.

3. Mercantilism and the Physiocracy
Mercantilism: power and wealth. Physiocracy: the philosophy of natural order. The economics of Physiocracy.

II. Classical Economics

4. Freedom and the wealth of nations: Adam Smith
Smith: the causes of the wealth of nations; theory of value; the theory of production; productive and unproductive labor; the social philosophy of the Wealth of Nations.

5. Distribution and growth of wealth: David Ricardo
The distribution of wealth. Theory of exchange value; the influence of distribution of exchange relations; Fundamental laws of distribution.

6. Crises or stability of the economy: Malthus vs. Say
Say’s Law. Malthus: arguments against Say’s Law, the role of effective demand.

7. The synthesis and decline of classical economic: J. St. Mill
Mill: the economics of liberal institutions; theory of value, laws of production and distribution; the social philosophy – social liberalism.

III. Against Classical Economics

8. Critics of liberal institutions and classical economics
Utopian socialism. Older Historical School: the integrity of social phenomena, development and economic laws.

9. Dialectical development of capitalism: Karl Marx
Theory of exchange value: commodity and the value of commodity. The theory of surplus value. Contradictions between labor and capital. Value and the price of production. The laws of motion of capitalism.

IV. The marginalist revolution

10. The begginings of marginalist analysis
Founders of the revolution: C. Menger, W.St. Jevons, L. Walras. Theory of marginal utility. The value of economic commodity.

11. Further development of marginalism
The theory of marginal productivity. Production decisions by the firms. Distribution theory base on the idea of marginal productivity. Ethical implications of the distribution theory.

12. General equilibrium theory: L. Walras
Outline of general equilibrium model. The premises of formalization of the model.

V. Neoclassical Economics

13. Neoclassical Economics: A. Marshall
Theory of value and price: utility and costs of production. Theory of value. The factors of production, supply and costs.

VI. Institutionalism and historical schools

14. Analysis of institutions and ideal types: T. Veblen and M. Weber
Institutionalism: T. Veblen; institutional analysis of capitalism; the theory of leisure class. Historical School: M. Weber.

VII. Modern economics: mainstream current

15. Macroeconomics of unemployment: Keynesian revolution
The principle of effective demand, the role of investment. Equilibrium unemployment. Liquidity trap. The principles of economic policy. Keynes’ social philosophy.

16. Neoclassical synthesis
J.R. Hicks: "Mr. Keynes and the Classics". IS – LM Model. Hicks-Hansen interpretation of Keynes.

17. Formalistic revolution in economics
The role of mathematics in economics. The rise and development of econometrics. Game theory and economics. Progress in general equilibrium theory.

18. Macroeconomics of unemployment and inflation: Monetarist counter-revolution
Monetarist account of inflation and unemployment. The theory of natural rate of unemployment. The principles of economic policy.

19. New macroeconomics: classical vs. Keynesian
Rational expectations hypothesis. The role of Philips curve in New Classical Macroeconomics. New Keynesian macroeconomics.

VIII. Modern economics: heterodox currents

20. Austrian School of Economics
C. Menger – the founder of Astrian School. Continuators: Mises and Hayek. The theory of spontaneous order.

21. Trends in institutional economics
(i) From Veblen to Galbraith. (ii) New Institutional Economics.

VIII. Conclusions

22. Economics in retrospect