HISTORY OF MACROECONOMICS

 

HISTORY OF MACROECONOMICS

The term 'macro' was first used in economics by Ragner Frisch in 1933.

But as a methodology approach to economic problem it originated with the mercantilists in the 16th and 17th centuries. They are there concerned with the economics system as a whole.

In the 18th century the physiocrats adopted Economique to show the circulation of wealth three classes represented by the farmer landlords and the striles class.

Malthas, Sismondi and Marx in the 19th century dealt with the macro economics problem Walrus, Wicksell and Fishers where the modern contributor to the development of the Macroeconomic analysis before the Keynes.

The Macroeconomics credit to generate the caves who finally developed a general theory of income output and employment in the wake of the great depression.

Macroeconomics, as it is modern form, is often define as starting with John Maynard Keynes  and the publication of the his book The General Theory of Employment, Interest and Money in 1936.

Keynes offered and explanation for the fall out from The Great Depression, when goods remain unsold and worker unemployed Keynes theory attempt to explain why market may not clear

Prior to the  popularization of Keynes's theories and economics did not generally differentiate between micro and macroeconomics.

The same microeconomics law of supply and demand that operate in individual good market where understood to interact between individual market to bring the economy into general equilibrium as described by Leon Walras. The link between good market and large-scale financial variable such as price level and interest rate was explained through the unique role that money plays in the economy as a medium of exchange by economists such as Knut Wicksell, Irving Fishers,and Mises.

Throughout the 20th century,  Keynesian economics, as Keynes's theories become known, diverged into serveral other school of thought.