David Ricardo (1772-1823), a stockbroker turned economist, made significant contributions to a number of areas of economic theory, including methodology, theories of value, international trade, public finance, diminishing returns, and rent. He began his study of economics sometime around 1799, when he was twenty-eight years old, and in 1810 published his first pamphlet, The High Price of Bullion. His essays on the Corn Law controversy, published around 1815, established him as one of England's most able economists. His major work, Principles of Political Economy and Taxation, published in 1817, soon replaced Adam Smith's Wealth of Nations as the accepted book on economic questions. It is the third and final edition of this work, printed as Volume I in the Sraffa and Dobb edition of Works, that we shall use for reference.
The quantity of material written about Ricardo and his theories is equaled only by that on Smith, Marx, and Keynes. In 1951 The Works and Correspondence of David Ricardo was published in ten volumes through the dedicated efforts of Piero Sraffa and Maurice Dobb. This edition took a good twenty years to produce and is a monument to one of the most gifted of economic theorists. That Ricardo's work continues to attract attention is evidenced by its recent reexaminations by Piero Sraffa, Samuel Hollander, Terry Peach, Mark Blaug, and others.
The Period Between Smith's Wealth of Nations and Ricardo's Principles
Until the appearance of Ricardo's Principles of Political Economy and Taxation in 1817, Adam Smith's Wealth of Nations, published in 1776, dominated English economic thought. In the four decades that intervened, no major new economic theory appeared, although several significant contributions to economic analysis were made. Thomas Robert Malthus (1766-1834) published an essay in 1798 and a book in 1803 on population; in 1815 Edward West, Robert Torrens, Malthus, and Ricardo published essays discussing the concept and economic significance of rent. Ideas on both these subjects came to be embodied in classical economics. Because the Malthusian population thesis is essential to an understanding of certain parts of Ricardian theory, we will consider it first. Then we will discuss and evaluate Ricardo's major contributions to economic thought, including his rent theory. Finally, we will return to Malthus to examine ideas developed in his Principles of Political Economy (1820) concerning the ability of the economy to operate automatically at full employment. In one of the liveliest controversies in the development of economic ideas, Malthus and Ricardo hotly debated this issue.