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How Did Enlightenment Ideas Influence Modern Economics

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Hume was one of the first thinkers to promote the idea of true “free trade,” unbounded by borders, tariffs, or other taxes on imports. He argued that foreign trade increases the stock of labor in a nation, which can then be used for public works projects. To Hume, imports were good as they were a sign of wealth in a nation and that increased imports usually lead to more luxury items, which ultimately meant that the people would be happier. Finally, David Hume thought that under a truly free economy, trade imbalances would not be a problem and that the amount of gold and silver leaving the country in such a system would be negligible because foreign investment would be promoted due to the lack of tariffs. <ref> Haar, p. 236</ref>
Although Hume recognized that sometimes wars were inevitable, he believed that they were for the most part terrible for economic progress. Hume argued that any benefits gained from territorial conquest were often mitigated by the fact that wars usually disturb free commerce, create lazy laborers, and are almost always expensive and increase the national debt. <ref> Haar, p. 234</ref> Ultimately, the entire concept of the empire itself was financially ruined some and for that reason alone should be abolished, Hume advocated. He believed that empires were usually beneficial to the mother country in the beginning, but almost always became financial burdens that hurt the overall economy. <ref> Haar, p. 236</ref> David Hume’s revolutionary economic ideas resonated with many Enlightenment thinkers, no more so than his fellow Scotsman, Adam Smith.

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