Ricardo's Principles of Political Economy

Ricardo's Principles of Political Economy analyze how economies grow and how prices are determined. He emphasized the importance of comparative advantage, meaning countries should specialize in producing goods where they are most efficient to maximize overall wealth. The theory also explores the impact of land, labor, and capital, highlighting that rent, wages, and profits are interconnected. Ricardo argued that resource scarcity and diminishing returns can influence prices and economic growth over time. His work laid the foundation for modern economic thought by explaining how international trade and resource distribution affect economic well-being.