Economic Theory and the Emergence of Market Society

Abstract

The interest of economic theorists in problems of dynamic historical change has fluctuated considerably since Adam Smith published the Wealth of Nations in 1776. The pioneers of ‘political economy’ like Smith, Ricardo, Malthus and J.S. Mill clearly demonstrated a strong concern for the nature and causes of economic change, and the ‘rise and fall’ of economic systems. This concern is also to be found in the German school of ‘historical economies’, whose protagonists included Roscher, Schmoller, and Sombart. The emergence of neo-classical economic theory during the latter part of the nineteenth century, however, represented a fundamental shift of emphasis away from questions of long-run change towards equilibrium analysis with its focus on short-run adjustment.