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The assumption that the economy was a zero-sum game was characteristic of the classical economists who came after Adam Smith. While Smith set himself the task o

• force_reboot 11y ago
  During my PhD in economics, the first few quarters of microeconomic theory focused on what we call classical economics, which is also called partial and general equilibrium theory. These theories are definitely not zero sum games. Even though partial and general equilibrium theory don't describe economics in terms of interactions between individuals (in the classical theory, individuals interact with the market), if they did, the nature of these interactions would be that they are always strictly positive sum for all actors. E.g. consider the supply and demand curves, and imagine that for each vertical line (or horizontal, depending on how you draw the axes), you "match" the buyers and sellers along that line. Then the difference in the prices that each individual is willing to buy/sell for is the total gain for that transaction, with how the gain is distributed being determined by the equilibrium price. Your summary seems to focus too much on early thinkers, and doesn't address the full development of classical theory which took until the 1950's.
• dragonwriter 11y ago
  Most post-Smith economics -- certainly everything in the market to tradition, classical or otherwise -- views normal transactions as net positive (and positive for each voluntary participant), not zero-sum. But there's no reason to assume the degree of benefit is the same for each participant, and intuitively I think a more realistic net-positivr transaction rule with the gain randomly distributed would have distributionally similar results.
• nickff 11y ago
  Ricardo was a paradigmatic case of non zero-sum thinking; he described comparative advantage, which shows the benefit of people specializing in different things.[1] [1] https://en.wikipedia.org/wiki/Comparative_advantage https://en.wikipedia.org/wiki/Comparative_advantage