Principles of Political Economy

What it is

This is Thomas Robert Malthus's 1820 treatise, written to rebut David Ricardo's work on political economy. A second edition, revised before his death, appeared in 1836. In it Malthus explores price determination, value, and why economic depressions occur.

Why it matters

Malthus rejected the idea, associated with Jean-Baptiste Say and defended by Ricardo, that supply automatically creates its own demand. Instead he argued that an oversupply of goods could cause recessions, developing the idea of 'effective demand.' A century later the economist John Maynard Keynes praised Malthus's insight, saying economics would have been wiser had it followed Malthus rather than Ricardo. The book also drew criticism from John Stuart Mill and praise from William Blake, showing how contested these economic questions were.

Look closer

• Why do you think Malthus wanted government spending to increase during economic downturns?
• How does Malthus's idea differ from the belief that supply creates its own demand?
• Why might economists disagree so strongly about the causes of recessions?