ECO428H1 Chapter Notes - Chapter Hollander: Colbertism, Physiocracy, Economic Rent
Document Summary
French physiocracy is perhaps first genuine school of economic thought. Considers land to be sole source of income: flourished under quesnay in 1750s and 1760s but not limited to this time period. Hints in wealth of nations, william spence (1807): britain"s wealth is in agriculture and international commerce not essential. Only sector that yields surplus over costs: proprietory. Do not generate surplus: four uses of term surplus, physical surplus, input less than output. Input should be same substance as output for least ambiguous definition b. Disposable surplus: any income above what is necessary to cover consumption and capital replacement assuming no growth/decline in economy. Returns to productive factors required to maintain this. Seems to be what physiocrats were talking about. May not necessarily be used for accumulation (can be consumed) but is available for net accumulation: payment exceeding marginal supply price of a factor.
