Economics evolving: a history of economic thought

Abstract

The study maps the historical evolution of economic thought and analytical methodology from the late eighteenth century up to the 1970s. It details the development of core principles governing price formation, income distribution, market efficiency, and economic development, framed by the contributions of foundational figures including Adam Smith, David Ricardo, Karl Marx, and John Stuart Mill. The narrative traces key transformations, such as the shift from classical political economy towards the marginalist revolution (Jevons, Walras, Marshall), which provided new microeconomic foundations for market analysis. Subsequent attention is given to the emergence of macroeconomics following John Maynard Keynes and the increasing reliance on mathematical and econometric rigor (Frisch, Haavelmo). The history underscores that economics is a continuously evolving discipline, shaped by the critical evaluation of prevailing theory and external socio-economic demands, particularly regarding the optimal balance between state intervention and market mechanisms. – AI-generated abstract.