David Ricardo (1772 - 1823)

David Ricardo

David Ricardo was a British economist and a classic of political economy.

David's father, a stockbroker, came from a Jewish family and emigrated from Holland to England in the early 1770s. After his studies, young David was hired by the London Stock Exchange and worked with his father, but at the age of 21 he broke away from his family. He soon started his own business as a dealer in government securities and became rich very quickly. At the age of 27, Ricardo became seriously interested in economics and from 1809 began to publish articles in the press on topical issues of currency and economics. He met the economist James Mill, who became his political and editorial adviser. He also befriended the utilitarian philosopher Jeremy Bentham and Thomas Malthus.

Ricardo's major work was On the Principles of Political Economy, and Taxation, published in London in 1817. It was a fundamental contribution to economic science and the first systematized approach to the subject. In this work, Ricardo addresses the "main problem of political economy," defined as determining the laws governing the "natural course of rents, profits, and wages" over time. He also develops ideas advanced in Adam Smith's The Wealth of Nations (1776), outlining a new labor theory of value, as well as theories of international competitive advantage and the effects of taxation. Ricardo was the first to formulate the "classical" system of political economy, and his ideas dominated economic thought throughout the 19th century.

By the age of 41, David Ricardo had completely retired from business and began to lead the quiet life of a gentleman and landowner on his estate. In 1819, Ricardo was elected to the British Parliament as an independent representative of a district in Ireland.