Classical Political Economy: Origins of the Economic Development Paradigm
In classical political economy, both theoretical hypotheses and empirical generalizations were used as interpretive tools to generate “covering laws” that were supposed to express timeless truths. Mainstream or orthodox classical political economy was instrumental in ushering in a liberal tradition in social and economic thought since individual liberty was considered a precondition for the establishment of a just and progressive economic order. Beginning with classical political economy, alternative economic analyses, including the study of development, have come to be rooted in different theories or understandings of “value.” The dominant paradigm in economics consists of a universal application of this principle to all situations and country contexts. Economists and economic historians sometimes distinguish between “extensive” and “intensive” growth, and characterize world history in terms of long periods of gradual extensive growth and the emergence of short bubbles of intensive growth.