History of Economic Thought Since 1870 (Outline)

1. History of Economic Thought Since 1870(Outline) • Up until 1870 the ruling system of economic thought was “Classical Economics” • Challenges to Classical economics came from • Internal weaknesses • German Historicism • Marxism • Romanticism • New issues and problems • 1870-1890 a period of transition from Classical economics to what became Neoclassical economics

2. History of Economic Thought Since 1870(Outline) • This transition is called the “Marginal Revolution” • 1st Stage was the development of Marginal Utility theory and theories of demand and exchange • 2nd Stage was development of Marginal Productivity theory and theories of production and distribution • Marshall’s Neoclassical Synthesis--1890

3. History of Economic Thought Since 1870(Outline) • Criticisms of Neoclassicism became prevalent in the 1920s—Institutionalism • 1930s Many Developments in Neoclassical Theory • “Keynesian Revolution” and counter-revolution 1936-1960 • More recent developments—new tools and expanding subject areas