Classical economics

Classical economics is a school of economic thought whose major developers include William Petty, Adam Smith, David Ricardo, and John Stuart Mill. It is seen by many as the first modern school of economic thought.

It tended to stress the benefits of trade, an analysis organized around the natural price of commodities, and either the cost of production theory of value or the labor theory of value.

It was largely displaced by marginalist schools of thought (such as the Austrian School) who saw value to derive from the marginal utility that consumers found in a good rather than the cost of the inputs that made up the product. Ironically, considering the attachment of many classical economists to the free market, the largest school of economic thought that still adheres to classical forms is the Marxist school. This may be due to the fact that Karl Marx died before marginalist theories were widely accepted.