Історія макроекономічної думки. Богдан Сторощук та Михайло Кухар

Main ideas & lessons (macro history of economic thought)

Why economic history matters

• Economic history is presented as a subject at the intersection of philosophy, economics (as theory), economic science, and the real economy.
• Economic “science” historically did not develop like pure abstract mathematics:
  • thinkers often built ideas from observing real life,
  • which allowed different views to coexist.

Old views: wealth can come from “non-economic” sources

• Citing ancient thinkers (Aristotle/Plato/Xenophon), wealth is framed as possibly arising from:
  • violence
  • deception
• These views are described as “plausible” for their era because:
  • low productivity made systematic observation of everyday wealth-creation difficult,
  • major wealth accumulation often related to trade, usury, robbery/violence, not production.

Mercantilists (c. 16th–17th centuries) as early “state macroeconomics”

• Mercantilism is described as macro-level because it focuses on the state:
  • budgets
  • reserves
  • foreign trade
  • political power
• Core concepts:
  • Early mercantilism: maximize wealth by saving (accumulating money/gold).
  • Spanish early mercantilist example: even extreme proposals—such as policies that effectively force wealth into gold by banning spending—are framed as ways to maximize bullion accumulation.
  • Late mercantilism: maximize wealth through exports > imports, achieved via:
    • tariffs
    • import restrictions
    • sometimes prohibiting export of money (merchants must leave with goods, not gold)
• Drivers shaping these views:
  • geographical discoveries (new routes; access to wealth/goods such as spices and silk)
  • price revolutions / inflation (rapid changes in European prices and inflation patterns)
• Mercantilists are portrayed as practitioners (merchants/lenders) who kept diaries and records.

Early monetary ideas and “reserve policy”

• Some mercantilist-associated thinkers are credited with early versions of:
  • state reserve management (buy low/sell high; keep margins to smooth shocks)
  • monetary stabilization reasoning:
    • if gold leaves the market, it can cause inflation,
    • yet balance might be maintained through channels like bank loans and new production
• Later references (e.g., Keynes) acknowledge predecessors who anticipated parts of monetary reasoning.

Physiocrats and the first “macroeconomic circulation model”

• Physiocrats are framed as a localized French reaction to Colbert-style mercantilism.
• Main claims:
  • the source of wealth is land/nature (agriculture)
  • liberalism, interpreted as reduced state intervention in economic functioning
• François Quesnay is credited with the first macro “economic tables,” including:
  • a division into classes:
    • productive peasants
    • unproductive artisans/merchants
    • landowners as a money-holding class
  • emphasis that aggregate demand is crucial for circulation to work

Classical school: economics becomes “proper science,” and state functions become minimal

• Classical economists (e.g., Adam Smith) are described as:
  • transforming economics from diaries/notes into hypotheses, proofs, and scientific presentation
  • focusing on national wealth valuation and early political arithmetic
• Smith’s “minimum state” is summarized as three public goods / state functions:
  1. External security (border protection)
  2. Internal security (including rule of law; protection of property and inviolability)
  3. Management of settlements (public goods markets cannot supply reliably)
• Classical value/production themes discussed:
  • division of labor increases productivity
  • the “invisible hand” explained through opportunity cost and market signaling
  • market self-regulation: if supply/demand shifts, production adjusts

Classical expansion: comparative advantage, Say’s law, and population dynamics

• David Ricardo: stresses comparative advantage (opportunity cost), not absolute advantage.
• Jean-Baptiste Say: crises are impossible in the aggregate—supply creates corresponding demand.
• Thomas Malthus:
  • population grows faster than resources (geometric vs arithmetic patterns)
  • potential pressures yield wars/epidemics/famine unless people practice restraint

Marxist school (framed as both right and wrong depending on the point)

• Marx is presented as building on classical foundations but making errors:
  • predicted capitalism’s collapse too simplistically and too violently
  • underestimated evolution of capitalist systems
  • underestimated the entrepreneur/organization role as productive
• A nuance is offered:
  • Marx’s “communism” is contrasted with modern wage shares using statistics, framed as an attempt to express wage/labor-cost ratios more fairly.

Historical school (German origin): no universal laws

• The historical school emphasizes:
  • national specificity rather than universal economic laws
  • collecting and systematizing statistical data for each case
• It is criticized as encouraging state-over-individual logic:
  • state and corporations above individuals
  • (by the speaker) sometimes linked to later fascist economic theory
• Its contribution is framed as organizing/creating mass statistical information.

Neoclassical revolution: markets, equilibrium, and methodological formalism

• Alfred Marshall and neoclassical ideas are portrayed as foundational:
  • “Marshall’s scissors” (intersection of curves)
  • general equilibrium as a central “perfect model” (even if unrealistic)
  • differences in adjustment assumptions (prices vs quantities flexibility)
• Arthur Cecil Pigou is credited with further contributions to wealth and structural topics.

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20th-century directions of economic science

Four fundamental directions

1. Institutionalism

   • Markets dominate, but “how laws work” depends on institutions:
     • culture, families, education, healthcare
     • fair trial, arbitration
     • customs/tax rules
   • Critique/debate:
     • institutions cannot be built instantly “by will”—they evolve historically
     • American institutions are described as forming evolutionarily from below through agreements between free counterparts and local governance arrangements.

2. Socio-economic/statistical institutional continuity

   • Focus on statistical research and analysis of economic cycles
   • Connected to figures such as Wesley Clair Mitchell
   • Linked to national accounts and macro measurement (via Simon Kuznets)

3. Imperfect competition school

   • Associated with Joan Robinson and Joseph (Edward) Schumpeter (as presented)
   • Signals later developments in competition and market structure.

4. Keynesianism and post-Keynesianism

   • Keynes is framed as opposing classical automatic restoration of equilibrium.
   • The Great Depression motivates state intervention: markets are inefficient at solving unemployment and instability.
   • Key Keynesian mechanisms summarized:
     • wages and prices do not adjust smoothly downward
     • interest rates (money interest) are not decisive in the classical way
     • banks create money through lending
     • aggregate demand is unstable → government should stimulate aggregate demand, mainly via fiscal policy
     • monetary policy is more for inflation containment

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Neoclassical synthesis and Keynesian synthesis (“not contradiction”)

• The lecture stresses reconciliation in a Samuelson/Modigliani style:
  • classical economics applies to the long run
  • Keynes applies to the short run (unemployment, idle capacity)
  • therefore conclusions can coexist under different time assumptions
• The AD-AS framework is described:
  • vertical aggregate supply at potential output (full employment, classical)
  • less elastic (often horizontal) supply when unemployment exists (Keynes)
  • state intervention corrects negative effects while still allowing markets to play a role

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Neoliberalism and neoconservatism (late lecture focus)

• Neoliberalism is described as reviving Smith under “natural order” conditions:
  • the state should create the natural order (rules/competition), not replace markets
• Examples mentioned:
  • Hayek, Ludwig von Mises (Austrian/Viennese–London tradition)
  • Monetarism: Milton Friedman, Anna Schwartz (rules for money supply growth)
  • Ordoliberalism / Freiburg school (e.g., Eucken, Erhard as named): strong anti-trust and equalized access to key goods (education/health/infrastructure)
• Neoconservatism is framed as relying on Say’s law and emphasizing:
  • stimulus to aggregate supply (productivity growth)
  • policies associated with Reagan/Thatcher
  • growth models (e.g., Denison/Meath, then Nobel-laureate work on growth factors)
  • rational expectations (Lucas/Sargent style): agents adapt; activism can be ineffective if anticipated.

Inflation as a debated “tool”

• The speaker argues inflation is not inherently “bad” in all cases:
  • moderate “positive inflation” can signal supply/demand adjustment in functioning markets
  • in developing economies, inflation may need to be higher (double digits) due to incomplete market mechanisms
• Later, it’s added that:
  • many countries historically grew even with some inflation
  • inflation suppression programs (linked to IMF-era reforms, as mentioned) can cause damaging short-term effects

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Methodology / instruction-like content (frameworks used by the lecture)

A) Conceptual framework: how wealth maximization differs by mercantilist stage

• Early mercantilists: wealth maximized by not spending (save; accumulate gold).
• Late mercantilists: wealth maximized by export superiority:
  • restrict imports via tariffs/bans
  • sometimes ban export of money (exit with goods, not specie)

B) Keynesian policy logic (state intervention)

• Diagnosis: classical self-correction fails because:
  • wage/price/stability assumptions do not hold,
  • unemployment persists,
  • aggregate demand is unstable,
  • money/interest mechanisms differ from classical expectations.
• Response:
  • stimulate aggregate demand
  • prefer active fiscal policy over monetary policy for unemployment-demand stabilization
  • treat monetary policy primarily as inflation containment

C) State “minimum functions” (Smith-style public goods)

• Provide:
  • external security
  • internal security + rule of law
  • public goods/settlement management that markets cannot reproduce

D) Neoconservative supply-side intervention logic

• Assume (framed via Say’s law) that:
  • increased production (aggregate supply) generates matching demand.
• Policy method:
  • encourage productivity and restructuring (examples linked to Reagan/Thatcher)
  • prioritize growth drivers (innovation, institutions, sector dynamics)
  • under rational expectations, ensure credibility: agents anticipate policy, so policies must be productivity-oriented and believable.

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Speakers / sources featured (as identified in subtitles)

Speakers (on video)

• Bogdan Dmytrovych Storozhchuk (main speaker)
• Mihailo (Mikhail) Kukhar (co-speaker / host and discussion partner)
• “Deer friends / Business Club of the Future” (hosts’ label for the audience)

Historical economists / thinkers named

• Aristotle, Plato, Xenophon
• Juan de Mariana, Bernardo Davanzati
• William Stafford, Thomas Mun
• Jean-Baptiste Colbert, François Quesnay, Jean Bodin
• John Law, John Locke, Richard Cantillon, Gaspar Scaruffi
• Adam Smith, William (Petty) (political arithmetic implied)
• Pierre de Boisguilbert
• David Ricardo, Jean-Baptiste Say, Thomas Robert Malthus, John Stuart Mill
• Karl Marx, Friedrich Engels
• Paul Bücher (mentioned in context of “economics not a classical science”)
• Emil / “Paul Elson” (subtitles suggest an unclear name; historical school figure implied)
• Alfred Marshall, Arthur Cecil Pigou, Thorstein Veblen
• John Roger Commons
• Wesley Clair Mitchell, Simon Kuznets
• Joseph Alois Schumpeter, Joan Violet Robinson
• Robert Lucas
• Milton Friedman, Anna Schwartz
• Ludwig von Mises, Friedrich von Hayek
• Paul Samuelson, Franco Modigliani
• Keynes (John Maynard Keynes)

Public/political figures or other references

• Winston Churchill
• Ronald Reagan
• Margaret Thatcher

Institutions/events referenced

• Nobel Prize in Economics (general reference)
• Great Depression (US unemployment reference)
• IMF-related stabilization rules
• World War II and post-war production capacity
• Nixon ending gold convertibility (briefly referenced)
• BLM protests (used as an example related to due process/inviolability)
• Ukraine-specific references (e.g., demographics, GDP share from government, educational reforms)