An economic thought led by Adam Smith, David Ricardo, Thomas Malthus, and John Stuart Mill that defends that the selfish interest of each individual and free competition determine the ideal price system. Founded by Adam Smith in 1776, it was the prevailing school of thought until Keynes, although with various nuances. Its macroeconomic theory would be built around Say’s Law and the invisible hand. The classical school believed in the free market as the most efficient system for allocating scarce resources, attributing it with certain parallels with the functioning of nature. At its origin, the classical school contrasted with mercantilism, which was strongly interventionist.
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