David Ricardo - His Life
David Ricardo was born in 1772. He was the third of seventeen children. His family was descended from Iberian Jews who had fled to Holland in the early18th Century. Ricardo's father, a stockbroker, emigrated to England shortly before David was born.
Ricardo began working full-time for his father at the London Stock Exchange when he was fourteen. When he was 21 his family disinherited him when he married a Quaker. Luckily he already had an excellent reputation in finance and he set up his own business as a dealer in government securities. He quickly became very rich.
David Ricardo retired from business in 1814 and was elected to the British parliament in 1819 as an independent representing a borough in Ireland, which he served up to his death in 1823. In parliament, his main interests were in the currency and commercial questions of the day. When he died, his estate was worth over $100 million in today's dollars.
David Ricardo - His Work
Ricardo read Adam Smith's Wealth of Nations (1776) when he was in his late twenties. This sparked an interest in economics that lasted his whole life. In 1809 Ricardo began to write down his own ideas in economics for newspaper articles.
In his Essay on the Influence of a Low Price of Corn on the Profits of Stock (1815), Ricardo articulated what came to be known as the law of diminishing returns. (This principle was also discovered simultaneously and independently by Malthus, Robert Torrens, and Edward West).
In 1817 David Ricardo published Principles of Political Economy and Taxation. In this text, Ricardo integrated a theory of value into his theory of distribution. David Ricardo's attempts to answer important economic issues took economics to an unprecedented degree of theoretical sophistication. He outlined the Classical system more clearly and consistently than anyone before had done. His ideas became known as the "Classical" or "Ricardian" School. While his ideas were followed they slowly were replaced. However, even today the "Neo-Ricardian" research program exists.