Economic Theorists Flashcards
1
Q
Who are the main economic theorists?
A
Adam Smith
F.A Hayek
Karl Marx
John Maynard Keynes (Not covered in Theme 1)
2
Q
Who was Adam Smith and what did he believe in?
A
- Lived 1723 - 1790
- Wrote ‘The Wealth Of Nations’
- Supported Free Markets through the idea of self interest (did not like monopolies)
- Believed in the invisible hand leading to increased efficiency and lower prices
- Viewed the profit motive as vital for success
- Believed in Free Trade and ideas surrounding ‘Specialisation’
3
Q
Who was F.A Hayek and what did he believe in?
A
- Lived 1899 - 1992
- Was an Austrian Economist and the leading member of the ‘Austrian School Of Economics’
- Supported the idea that Buyers and Sellers knew the market best and the government should avoid any intervention
- Wrote ‘The Road To Serfdom’ in 1943
- Believed Government intervention would distort the market and damage the way scarce resources are allocated
4
Q
Who was Karl Marx and what did he believe in?
A
Lived 1818 - 1883
Wrote ‘The Communist Manifesto’
Believed that Capitalism was unsustainable and oppressed workers
Supported workers overthrowing the owners, leading the workers owning the meaning of production
(HIS IDEAS DO NOT WORK)
5
Q
Who was John Maynard Keynes and what did he believe in?
A
Lived 1883 - 1946
Father of the ‘Keynesian School Of Economics’
- Believed governments need to intervene to close recessionary gaps due to the long time it can take for free markets to return to Full Employment
- Wrote ‘The General Theory Of Employment, Interest and Money’ in 1936
- “In the long run we are all dead”
- Supported the idea that an economy can only achieve its potential if there is sufficient AD in the economy
6
Q
What do all of these theorists try to solve?
A
The Basic Economic Problem
