ABSTRACT
Ever since the classical era in economics, the century ranging from Adam Smith to Karl Marx, political economy has accorded a central place to the analysis of class and class struggle. David Ricardo, writing early in the nineteenth century, identified three principal classes: landlords, capitalists, and workers. Since he assumed-like many of his contemporaries-that workers would be limited to a subsistence wage over the long term under any circumstances (any significant rise in wages would increase the working population and the ensuing competition would bring wages back down to the subsistence level), Ricardo believed that the competition over the economic surplus would be carried out between the landowners and the capitalists. Since the landowners used their income (from rent) for luxury consumption whereas the capitalists used their profits for reinvestment, economic growth and the progress of society depended, in Ricardo’s view, on the capitalists prevailing. Ricardo’s analysis suggested that over the long term the share of rent in national income would tend to increase with the growth of population, but that public policy (such as the 1846 repeal of the Corn Laws) could postpone the ultimate decline in profits and the corresponding end of economic growth.
