David Ricardo's macroeconomics, a study in historical perspective

grantor: University of TorontoThis thesis confronts the tendency in the literature of the history of economic thought to criticize Ricardo's macroeconomics, specifically his knowledge of contemporary events, his analysis of postwar crises, and his monetary and fiscal policies. To this end, the historical introduction in Chapters One and Two is critical, for it dispenses with the traditional view that the postwar decade was a period of chronic depression caused by underconsumption and, to a lesser extent, by monetary contraction associated with the 1819 Resumption Act. Chapter Three completes the foundation of our study by showing that Ricardo was well informed regarding Britain's economic and political situation. That he used this knowledge as a basis for his analysis of contemporary events is established in Chapters Four and Five, which chapters also refute the view that his treatment of postwar crises was merely a rationalization of the crude quantity theory and the strict law of markets in the face of overwhelmingly contradictory evidence. Chapter Six argues the merits of his monetary policies, particularly his insistence on the gold standard as a means to curb abuses by the Bank of England and the Government, which together were responsible for gross mismanagement of the currency. The chapter further examines whether Ricardo accepted "Treasury View" of fiscal policy, and whether his position implies adherence to a doctrinaire version of Say's Law. My conclusions differ from those of authors critical of Ricardo largely because I have adopted a methodological approach to the history of economic thought that differs from theirs. My methodology has no merit of originality, but it does incorporate two tenets of sound scholarship: first, that primary texts should be interpreted in an accurate historical context; and second, that textual exegesis involves more than piecing together scattered quotes, but should entail the interpretation of an author's complete position.Ph.D