Classical economic theory and marginalist economic theory

Abstract

This paper discusses the importance of the differences between classical and
marginalist economic theories, with a special interest on David Ricardo’s thought. In order
to analyse the theoretical incompatibility among classicals and marginalists, the critical
hypotheses to prove the referred incompatibility are settled and checked. It is seen that the
most important element in distinguishing classicals and marginalists is the difference in the
approach to the labor market. In fact, the classical determination of the wage rate is sharply
distinct from the General Equilibrium Theory, based on the supply and demand principle.

JEL Classification: B12; B13; D46.