scroll to top
Stuck on your essay?
Get ideas from this essay and see how your work stacks up
Word Count: 2,181
laissez-faire Classical Laissez-faire Economics The earliest organized school of economic thought is known as Classical The father of this school is Adam Smith Smith used the concept of the invisible hand to describe the role of the market in the allocation of resources In the market the interaction of demand and supply determines how much of a good will be produced and the price that is charged for that good Absent any explicit guidance mechanism the invisible hand guides participants in the market towards an outcome that efficiently allocates resources to the production of goods that society desires Other important classical economists include David Ricardo who introduced and developed the concepts of comparative advantage and the benefits of an open economy that participates in international trade JB Says presented what is today known as Says Law supply creates its own demand Says law captures the essence of the classical school of thought The statement that supply creates its own demand implies that by producing goods and services firms create the jobs and incomes capable of buying those goods and services With economic foundations based on the role of markets a theory generally free of outside intervention and emphasizing the role of production in determining income and economic output the classical school of thought has several important implications The government should play a minimal role in determining the condition of the economy The government does have an important place in areas such as providing a legal framework preventing abuses of the market and to sustain national defense However extensive government intervention will hinder the efficient operation of the market in the determination of prices of goods and services and the allocation of resources towards their production The normal economic state of the economy is at full employment This implies that all workers that desire jobs will have them and those who are unemployed voluntarily choose to be so The government has a minimal
@Kibin is a lifesaver for my essay right now!!
- Sandra Slivka, student @ UC Berkeley
Wow, this is the best essay help I've ever received!
- Camvu Pham, student @ U of M
If I'd known about @Kibin in college, I would have gotten much more sleep
- Jen Soust, alumni @ UCLA