Key Economic Schools of Thought: A Concise Overview

Key Economic Schools of Thought

ISO (Income Statement Only): Tax on corporate income, a direct tax reflecting wealth. It benefits businesses (corporations or legal persons).

Invisible Hand: The classical liberal school believes that individuals, pursuing their self-interests, unintentionally benefit society through the "invisible hand" of the economy.

Mercantilism: Author Spotlight: Jean-Baptiste Colbert, the father of Colbertism. Mercantilists believed that accumulating gold and silver was key to national wealth, achieved through colonies and mine exploitation.

Physiocrats: Author Spotlight: François Quesnay. He wrote "Tableau Économique," describing the circular flow of income. They considered agriculture the only economic activity capable of generating wealth, with commerce as the transmission belt.

Laissez-Faire: This is the operating principle in the economy, viewing the circular flow like blood. The State's role was to prevent interference with the economy.

Marxism: Karl Marx, a key author, economist, and philosopher, emphasized increasing national wealth and determining price from value theory (David Ricardo's work). His work, Capital, develops his economic philosophy based on diminishing returns and capital accumulation by owners. Karl Marx believed the division of society would lead to the fall of capitalism and the arrival of communism.

Neoclassical Economics: Key authors include Léon Walras and Alfred Marshall. These economists shifted focus from national wealth to individual decisions, determining that choices drive supply and demand. Perfectly competitive equilibrium determines the price and quantity of goods exchanged in the market.

Alfred Marshall: He stated that economics is the study of humanity in the conduct of their daily lives.

Galbraith: He argued that individuals rely on large corporations, unions, and governments to meet their economic needs.

The word "economy" means "administration of a home."

Samuelson: In economics textbooks, he defines economics as the study of how societies use scarce resources to produce valuable goods and distribute them to individuals.

Simon Andrade: In his Economy Dictionary, he defines economy as the straightforward, prudent administration of assets and resources.

Definition according to RAE (Real Academia Española): The effective and fair administration of assets; the set of goods and activities that integrate an individual's wealth; the science that studies the most effective methods to meet human needs through the use of scarce goods.