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David Ricardo (April 18, 1772 — September 11,
1823), a British political economy|political
economist, is often credited with systematizing
economics, and was one of the most influential of
the classical economics|classical economists. He
was also a successful businessman, financier and
speculator, and amassed a considerable fortune.

==Personal life==

Born in London, Ricardo was the third of seventeen
children in a Sephardi|Sephardic Jewish family
(from Portugal) that emigrated from
Netherlands|The Netherlands to England just prior
to his birth. At age 14 Ricardo joined his father
at the London Stock Exchange, where he began to
learn the about the workings of finance. This
beginning set the stage for Ricardo's later
success in the stock market and real estate. 

Ricardo rejected the Orthodox_Judaism|orthodox
Jewish beliefs of his family and eloped with a
Religious Society of Friends|Quakeress, Priscilla
Anne Wilkinson, when he was 21. His father was so
unhappy with this that he abandoned Ricardo and
never spoke to him again. Around the same time
Ricardo became a Utilitarian.

Ricardo became interested in economics after
reading Adam Smith's The Wealth of Nations in 1799
on a boring vacation to the English resort of
Bath.

Ricardo's work with the stock exchange made him
quite wealthy, which allowed him to retire from
business in 1814 at the age of 42. He then
purchased and moved to Gatcombe Park, an estate in
Gloucestershire.

In 1819, Ricardo purchased a seat in the
Parliament of the United Kingdom|British
parliament as a Peers and
Parliament|representative of Portarlington, a
Peerage of Ireland|borough of Ireland. He held the
post until the year of his death in 1823. As an
Member of Parliament|MP, Ricardo advocated free
trade and the repeal of the Corn Laws.

Ricardo was a close friend of James Mill, who
encouraged him in his political ambitions and
writings about economics. Other notable friends
included Jeremy Bentham and Thomas Malthus, with
whom Ricardo had a considerable debate (in
correspondence) over such things as the role of
land owners in a society. He also was a member of
London's intellectuals, later becoming a member of
Malthus' Political Economy Club, and a member of
the King of Clubs.

He died at Gatcombe Park at 51 years of age.

==Ideas==

Ricardo's most famous work is his Iron law of
wages, a document which shows his capitalist
tendencies. In this book Ricardo states that the
wages of 19th century British workers should not
be increased, though it was encouraged greatly by
the masses. This was due to his observation of the
direct link evident between money and population.
An increase in income of workers equals an
increase in children, resulting in a larger
workforce. Such an increase means that employers
will be forced to lower wages as their working
population grows exponentially. Also, the surplus
of workers and lower wages will combine to create
a greater state of poverty that existed before
wages were originally raised. Ultimately, he
favoured employers far more than workers, in
contrast to the philosophy adopted by Karl Marx.

Also important was Ricardo's work on the concept
of comparative advantage. According to Ricardo's
theory, even if a country could produce everything
more efficiently than another country, it would
reap gains from specializing in what it was best
at producing and trading with other nations.
Comparative advantage forms the basis of modern
trade theory. 

Like Adam Smith, Ricardo was also an opponent of
protectionism for national economies. He believed
also believed that protectionism  led towards
economic stagnation, and that protectionism by
more economically productive countries doomed less
developed countries to stagation. He also
influenced generations of later economists in the
belief that protectionism is bad for the economy.

Ricardo is also known for his opposition to the
"corn laws", which protected British landowners
from foreign competition by guaranteeing them a
high price for their produce. Ricardo did not
actually argue the case out of compassion to the
peasants or general population (who were starving,
due to insufficient production), but felt that
this was unfairly diverting a lot of resources
from the bourgeoisie (seen as a force of progress)
towards the landowners. Unfortunately, he was
unable to get Parliament to remove the law, which
it later repealed in 1846.

Other ideas associated with Ricardo:
* Ricardian equivalence, an argument suggesting
that in some circumstances a government's choice
of how to pay for its spending (ie, whether to use
tax revenue or issue debt and run a deficit) might
have no effect on the economy. Ironically, while
the proposition bears his name, he does not seem
to have believed it. Robert Barro is responsible
for its modern prominence.
* The iron law of wages, which asserted that real
income of workers would remain near the
subsistence level, despite any attempts to raise
wages.

==Publications==

Ricardo's publications included:
* The High Price of Bullion, a Proof of the
Depreciation of Bank Notes (1810), which advocated
the adoption of a metallic currency
* Essay on the Influence of a Low Price of Corn on
the Profits of Stock (1815), which argued that
repealing the Corn Laws would distribute more
wealth to the productive members of society
* Principles of Political Economy and Taxation
(1817), an analysis that concluded that land
(economics)|land rent grows as population
increases. It also clearly laid out the theory of
comparative advantage, which showed that all
nations could benefit from free trade, even if a
nation was less efficient at producing all kinds
of goods than its trading partners.

==See also==
*Liberalism
*Contributions to liberal theory

==External links==
Wikisource author
* http://www.econlib.org/library/Ricardo/ricP.html
On the Principles of Political Economy and
Taxation, by David Ricardo. Complete,
fully-searchable text at the Library of Economics
and Liberty.
*
http://www.econlib.org/library/Enc/bios/Ricardo.ht
ml Biography, at the Concise Encyclopedia of
Economics
*
http://cepa.newschool.edu/het/profiles/ricardo.htm
Biography at New School University