Chapter 1

The Timeline of Economic Thought 1204-2020 Icon

January 31, 2022

The differences in the economic philosophies of different time periods can be attributed to the main ideas or mentalities prevalent during those times, as the effect of new experiences or ‘impressions’ on the mind. We chronologically list the main events that may have caused people to have those new experiences from which they developed new ideas.

Dutch

Proto-mercantile: The Rise Of The Merchants (1204-1420)

The Venetians give Europe the first taste of commerce and manufactures |

Year Event
1204 Constantinople is sacked during the Fourth Crusade and treasures are brought back to Venice, which becomes a European power
1271 Marco Polo, a Venetian, leaves for Asia
1300 The Travels of Marco Polo is published, describing the East
1368 Start of the Ming Dynasty
1405 The Ming show off its wealth and power through its Treasure Fleet

Pre-mercantile: Discovery And Conquest For Gold And Silver (1420-1600)

The Portuguese and Spanish want to join in the Italians’ business through sea exploration, since the way to the East was blockeed by the Arabs through fall of Constantinople

Year Event
1425 Henry the Navigator develops the caravel to be used to seek a sea route to the East
1488 Portuguese Bartolomeu Dias reaches Cape of Good Hope
1492 Italian Christopher Columbus reaches the Americas through Spanish support
1498 Portuguese Vasco da Gama reaches India
1577 Venice suffers from the Black Death while having lost its Eastern trade to the Portuguese
1588 Spanish Armada defeated by the British

Mercantile Period: The Problem Begins (1600-1799)

Trade and the Commercial Company Spread Around the World Like a Virus. With the Spanish defeated, other Europeans join in the colonization game with their own merchants through the invention of companies, paper financial products, and commodities trading

Year Event
1600 English East India Company established
1602 Dutch East India Company established
1660 Royal African Company established
1694 (Central) Bank of England established
1695 Bank of Scotland established
1711 South Sea Company established
1714 John Law goes to France to eventually set up the Mississippi scheme
1752 Royal African Company dissolved
1755 Richard Cantillon publishes Essai, contributing to monetary theory
1759 Adam Smith publishes The Theory of Moral Sentiments, advocating a new system of morality that is against Utility
1776 Adam Smith publishes The Wealth of Nations,bashing the Commercial System which is based on Money and Utility
1789 Start of the French Revolution

Pre-capitalist Period: Utility And Money For Pleasure And Industrial Development (1800-1889)

The Greed Virus Takes Root. The too-big-to-fail commercial company model proves unsustainable. The Industrial Revolution peaks, leading to new material experiences to gratify the senses. The word ‘scientist’ replaces ’natural philosopher’. Big non-corporate companies are established to build steel plants and railroads.

Year Event
1800 Dutch East India Company dissolved
1803 JB Say publishes A Treatise on Political Economy, advocating utility, the cause of producers, andtotally removing ethicsfrom the Political Economy
1850 South Sea Company dissolved
1874 English East India Company dissolved
1848 John Stuart Mill publishes Principles of Political Economy
1861 John Stuart Mill publishes Utilitarianism permanently corrupting the Political Economy with utility, something that Smith argued against in The Theory of Moral Sentiments
1867 Karl Marx publishes Capital: Critique of Political Economy, bashing the Capitalist system espoused by Mill that came from England and France
1870 John D. Rockefeller establishes Standard Oil which spurs the Second Industrial Revolution
1871 William Stanley Jevons publishes The Theory of Political Economy, adding Calculus to the Political Economy, also based on Utility. Carl Menger publishes Principles of Economics, starting the Austrian school
1872 Andrew Carnegie enters the steel business
1874 Leon Walras publishes Elements of Pure Economics with the General Equilibrium Theory

Capitalism: Microeconomics, Banks, And Big Business (1890-1944)

The Wealth Virus Creates War. The corporate ‘firm’ and banks pick up what the mercantile companies left behind. Economics is formalized. By now Western moral philosophy has died, leading to world wars.

Year Event
1890 Alfred Marshall publishes Principles of Economics, turning the Political Economy into Economics. By now, moral philosophy is totally alien to Economics
1892 Irving Fisher publishes Mathematical Investigations in the Theory of Value and Prices. The marginal revolution imposed the artificial concept of profit maximization which led to prices being unnatural. This transferred the economy from the hands of the entrepeneurs into the hands of banks which controlled the flow of money through interest rates.
1895 The bank J.P. Morgan and Company is established
1913 Federal Reserve System established
1914 World War 1. The lack of moral philosophy in the West eventually leads to war
1920’s The Fed goes into open market operations to grow the US economy
1929 Start of Great Depression
1936 John Maynard Keynes publishes The General Theory, establishing macroeconomics and the liquidity preference, enshrining money as wealth. Moral philosophy is still nowhere, proven by his reference to ‘animal spirits.’ It enshrines money, banking, and interest rates, different from the classical notions of capital, industry, and profits respectively
1939 World War 2. With no moral philosophy, World War 1 was revived with tanks, jets, rockets, and other 'wonder weapons' designed to kill humans more efficiently

Global Capitalism: (1944-2020)

The US emerges from the ashes of both world wars and the Cold War to impose its own system of global capitalism. The firm evolves into huge corporations, a type of which is the too-big-to-fail bank which can crash the global economy by itself. The Wealth Virus is Stopped by a Real Virus.

Year Event
1944 Bretton Woods established; The US becomes a superpower after World War II
1948 Paul Samuelson publishes Economics, standardizing Economic science
1971 Nixon shock makes currencies pegged to nothing. Oil prices spike as petrodollars get pegged to oil instead. Inflation follows
1998 Repeal of Glass-Steagal. Banks awash with fiat cash, which is pegged to nothing, combine long-term and short-term cash to get employed and make even more money
2008 Start of Financial Crisis in the US. The combined fiat cash of banks runs out of employment and crashes
2020 Under the weight and oppression of capitalism and global warming, Nature finally breaks out in revolt with a Covid-19 pandemic and a lot of natural disasters, bringing global capitalism to its knees which no economist can solve