Tag: #classicaleconomics

The Origin of Buddhism .

We are what we think. All that we are arises with our thoughts. With our thoughts, we make the world.
Peace comes from within. Do not seek it without.

Lord Buddha

Introduction.

He was a spiritual personality . An ancient teacher and enlightened many . A founder of world religion Buddhism . He was popularly known as Gautama Buddha (also known as Siddhattha Gotama or Siddhārtha Gautama or Buddha Shakyamuni ) .

The Enlightened One who rediscovered an ancient path to release clinging and craving and escape the cycle of birth and rebirth. He taught for around 45 years and built a large following, both monastic and lay. His teaching is based on his insight into the arising of duḥkha (the unsatisfactoriness of clinging to impermanent states and things) and the ending of duhkha—the state called Nibbāna or Nirvana (extinguishing of the three fires).

Buddhism

Buddhism, one of the major religions and philosophical systems of southern and eastern Asia and of the world. Buddha is one of the many epithets of a teacher who lived in northern India sometime between the 6th and the 4th century before the Common Era.

The title buddha was used by a number of religious groups in ancient India and had a range of meanings, but it came to be associated most strongly with the tradition of Buddhism and to mean an enlightened being, one who has awakened from the sleep of ignorance and achieved freedom from suffering.

According to the various traditions of Buddhism, there have been buddhas in the past and there will be buddhas in the future. Some forms of Buddhism hold that there is only one buddha for each historical age; others hold that all beings will eventually become buddhas because they possess the buddha nature (tathagatagarbha).

According to Buddhist doctrine, the universe is the product of karma, the law of the cause and effect of actions, according to which virtuous actions create pleasure in the future and nonvirtuous actions create pain.

Your work is to discover your world and then with all your heart give yourself to it.

Lord Buddha

History

Gautama Buddha ( born c. 6th–4th century BCE, Lumbini, near Kapilavastu, Shakya republic, Kosala kingdom [now in Nepal]—died, Kusinara, Malla republic, Magadha kingdom [now Kasia, India]).

Buddha is one of the many epithets of a teacher who lived in northern India sometime between the 6th and the 4th century before the Common Era.

Learnings from Gautama Buddha.

1. “Three things cannot be hidden: the sun, the moon and the truth.”

2. “You will not be punished for your anger; you will be punished by your anger.”

3. “You can search throughout the entire universe for someone who is more deserving of your love and affection than you are yourself, and that person is not to be found anywhere. You, yourself, as much as anybody in the entire universe, deserve your love and affection.”

4. “We are shaped by our thoughts; we become what we think. When the mind is pure, joy follows like a shadow that never leaves.”

5. “Believe nothing, no matter where you read it, or who said it, no matter if I have said it, unless it agrees with your own reason and your own common sense.”

Link

Classical Economics

Classical economics relates to the school of thought of economics that originated in Britain during the late 18th and early 19th centuries. The classical economists believed in the existence of full employment in the economy. It is believed that ‘The Wealth of Nations’ by Adam Smith published in 1776 marked the beginning of classical economics. J.B. Say, Alfred Marshall, A.C. Pigou are some of the famous classical economists.
This school of economics focused on the theory called the ‘invisible hand‘ being the highlight at the beginning stages of domestic and international supply and demand. They assumed the economy to be laissez faire capitalist. It was a closed economy with no foreign trade. Labour was a homogenous and wages were flexible. It assumed the economy to be in the long run.


https://cleartax.in/g/terms/classical-economics


The Classical school of thought is based on the Law of Markets given by J.B. Say. According to that law “supply creates it’s own demand“. Therefore there can never be the problem of overproduction or unemployment in the economy as whatever is produced is consumed. Unemployment may occur only in the short run and in the long run, economy tends towards full employment.
The Classical economists also believed in wage price flexibility. This concept was given by A.C. Pigou. It was basically the formulation of Say’s Law in terms of labour market. According to this, whenever there is unemployment in the economy, a general cut in money wages will restore full employment condition. Unemployment is a consequence of the rigid wage structure.
They also believed in the existence of equilibrium in the goods market. It is achieved when savings is equal to investment. This equality is usually brought by the mechanism of interest rate. Similarly, the money market is in equilibrium when the demand for money is equal to the supply of money. This concept was explained in the Quantity Theory of Money.

The Fall of Classical Economics:

During the time of The Great Depression i.e. 1929-1930’s, the classical theory failed to be applicable. It failed to solve the problem of depression that plagued for about 43 months. Keynes criticized the classical theory on several grounds.
First and foremost was the classical assumption of full employment equilibrium. Keynes considered it as unrealistic and argued that the situation in the capitalist economy is underemployment and full employment is a special case. He refuted Say’s law of market and stated that it was demand that created supply. He was also against the idea of laissez faire. He believed that self adjustment was not possible in a capitalist system and this was responsible for the Great Depression. He advocated state intervention within the economy through monetary and fiscal measures.
The wage price flexibility was also heavily criticised. In the modern world, where workers have trade unions, any cuts in wages will lead to strikes and industrial unrest. Keynes also stressed that equality between savings and investment was not brought by rate of interest but instead by the level of income and marginal efficiency of capital.
Lastly, the long run analysis of Classical economy was refuted on the grounds of inapplicability. Since it operated in the long run, it is incapable of solving present day economic problems.

https://www.yourarticlelibrary.com/economics/keynes-criticisms-against-classical-theory/24859