ABSTRACT
By undertaking a textual analysis of the key classical political economy texts before Adam Smith’s Wealth of Nations, this chapter surveys the theories of activity levels and growth in Richard Cantillon, François Quesnay, Anne Robert Jacques Turgot and James Steuart. Three key ideas emerge out of this history of economic thought exercise. First, with the exception of Cantillon, all of them recognize the role of capital accumulation in economic growth. Second, the idea that demand should validate supply is present in pre-Smithian political economy partly owing to their methodological adherence to the circular view of the economy. And third, it is labour demand which determines labour supply, a causation opposite to that found in marginalist economics.
