David Ricardo (1772–1823)

Date: 2015-10-07; view: 520.

David Ricardo was born on 19 April 1772 in London. He was the third son (out of seventeen!) of a Dutch Jew who had made a fortune on the London Stock Exchange. At the age of fourteen, after a brief schooling in Holland, Ricardo's father employed him full-time at the London Stock Exchange, where he quickly acquired a knack for the trade. At 21, Ricardo broke with his family and his orthodox Jewish faith when he decided to marry a Quaker called Priscilla Anne Wilkinson; Ricardo then converted to Christianity. His family disinherited him for marrying outside his Jewish faith.

Ricardo had to establish his own business. He continued as a member of the stock exchange. He did so well that in a few years he acquired a fortune. This enabled him to pursue his interests in literature and science, particularly in mathematics, chemistry, and geology.

He became rich in a very short time. When he died, his estate was worth over $100 million in today's dollars.

In 1799 he read Adam Smith's Wealth of Nations and got excited about economics. So for the next ten years he studied economics. In 1809 he wrote that England's inflation was the result of the Bank of England's propensity to issue excess bank notes. In short, Ricardo was an early believer in the quantity theory of money, or what is known today as monetarism.

In 1819 he became Member of Parliament. His free-trade views were received with respect, although they opposed the economic thinking of the day. In 1817, Ricardo published Principles of Political Economy and Taxation in which he developed the principle of comparative advantage - the main principle of international trade as we know it today.

He died on 11 September 1823 at the age of 51.

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