John Stuart Mill

Posted by admin at September 26, 2017

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Those who want to delete this approach of mere reformism reduce it to an idea that remains in eliminating extreme poverty, but when the basic income is included in a model economic is a revolutionary measure because it manages to unify this measure with the historical process of our economic model, or allows the overcoming of a reality that is transformed. Alternative La theory classical theory that emerges with Adam Smith, when he created the economic science, applied a method of analysis based on observation, since verifiable conclusions reached. The classical school of Economics comes marked by his book the wealth of Nations, published the year 1776. Year of the independence of the United States of America. This work is also considered the basis of economic liberalism. The conclusion is that wealth is derived from the work.

In relation to employment its foundations are applicable to an economic circumstance in which feasible in advance the full occupation. In addition David Ricardo, John Stuart Mill, Malthus and Karl Marx are enrolled in the classical school. The neo-classicists do not assume full employment, but rather apply the corresponding recipes to get. According to the classical theory there is no involuntary unemployment. Supply creates demand, which resulted with Say’s law. Real wages equals the marginal disutility of occupation.

The classical theory does not work for situations of involuntary unemployment. John Maynard Keynes, raised a revolution before this new circumstance. His theory is based on demand as an engine of the economy and do not offer. It assumes the reality of involuntary unemployment, so that arises as its primary objective the full employment, through public spending. It proposes an expansion of global demand so that through a multiplier effect, discovered by a co-worker yours in Cambridge, Robert Kahn, allows increased incomes and employment. He began what came to be called the Keynesian revolution which is based on the General theory, in contrast to the classical theory.

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