David Ricardo

David Ricardo was a British economist who studied how money, trade, and production work in society. He was born in London, England, in 1772 and died in 1823. An economist is a person who studies how people produce, buy, and sell goods. Ricardo lived at a time when factories, machines, and cities were growing quickly.

Ricardo was born into a family involved in finance. Finance means the management of money. His father worked in stock trading, which involves buying and selling shares in companies. As a young man, Ricardo learned about markets and prices. He later became wealthy through investment, which means using money to earn more money.

After becoming financially independent, Ricardo spent more time writing and studying. His most famous book is On the Principles of Political Economy and Taxation, published in 1817. In this book, he explained ideas about wages, profits, and rent. Rent is money paid for the use of land or buildings. Ricardo tried to explain how income is shared between workers, landowners, and business owners.

One of Ricardo’s best-known ideas is called comparative advantage. This idea explains how countries can benefit from trade by focusing on what they produce best. For example, one country may be better at growing wheat, while another is better at making cloth. By trading, both countries can get more goods. Ricardo explained this idea using simple numbers and examples.

Ricardo also wrote about taxes and government spending. A tax is money collected by a government to pay for public needs. He believed that some taxes affected prices and profits in different ways. His writing aimed to describe these effects clearly. He often exchanged letters and ideas with other thinkers, including Adam Smith and Thomas Malthus.

Later in his life, Ricardo became a member of the British Parliament. Parliament is the law-making body of the United Kingdom. He spoke about trade laws and economic issues. Ricardo died in 1823 at the age of 51. His ideas continued to be discussed by economists long after his death.