classical macroeconomic model

(18th-19th century)

Classical macroeconomic model is first developed by French economist Jean-Baptiste Say (1767-1832), and later revised by other classical economists.

Through the assumptions of factor and product price flexibility, and in the absence of regulations which prevent the market adjustment of demand and supply, full employment equilibrium will be reached in the classical macroeconomic model.

Also see: new classical macroeconomics, Say's law, stationary state, wages fund doctrine

Source:
A Smith, An Inquiry into the Nature and Causes of the Wealth of Nations (London, 1776)
J B Say, Traite d'Economie Politique (1803) (London, 1817)

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