Macroeconomics is a field of economic sciences. Unlike microeconomics, macroeconomics working with aggregates, investigates the behavior of the economy in general, such as total income or workforce employment, inflation or cyclical fluctuations. Macroeconomics trying to find explanations for these oscillations to find relevant control factors and establish their dependencies.
The focus of macroeconomic theories is ultimately the role that the state plays in the entire economic context; of these theories derives requirement for economic policy. Governments try to change elements that are significant due consideration ex-post. Thus, changes in taxes, interest or state application, politically defined goals, are pursuing other purposes such as price level stability, full employment of labor and economic growth. Macroeconomic elements play an important role in legitimizing the political process as voters could interpret them as an indication of the quality of governmental activity.
History of macroeconomics
From Antiquity to the Middle Ages began to appear reflections on trade in works of certain philosophers, theologians, professors of law and finance. Building economic theories from academic discussions and reflections on trade in the current economic current sense occurred only rarely at that time. Some of the ancient ancestors of today’s economists were, among others: Xenophon, Plato and Aristotle; and in the Middle Ages were: Thomas More, Thomas Hobbes, John Locke and Gottfried Wilhelm Leibniz. Economic policy was often driven without a sound theoretical basis.
From mercantilism to classicism
During absolutism crystallized in France, Italy and England one direction in economic policy, which was not based on a compact theory, but on perceptions of trade links, as was the case until then. Mercantilist economic policy was characterized by massive interventions in the economy of the state and France led to a decline in agriculture. As a reaction to this development, doctor François Quesnay published in 1758 in the Tableau Economique the theory of an economic mechanism based on an open, laissez-faire policy. This school later called physiocrats is considered the first attempt in the theory of economics.
In England, physiocrats ideas were accepted and have been developed into a theory for the whole society, the traditional national economy. Adam Smith, David Ricardo and John Stuart Mill were often appointed to be the most important representatives of this school. Unlike physiocrats, classics were of the view that the state should be limited to interventions in economic events, to avoid erroneous trends.
From classicism to Keynes
In the course of industrialization and the widening social gaps associated with it, there were amplified in cities the questions of economists about dividing the earnings and became an interesting topic of discussion. Socialism and Marxism have occurred. These tendencies have emphasized the need to regulate economic operations and demanded the collectivization of the means of production. Representatives of leading this trend were: Robert Owen, Charles Fourier and Karl Marx.
Meanwhile other scientists strongly animated by a sense of national bourgeois have created the historicism: Gustav von Schmoller and Friedrich List. They wanted the state to get involved to protect the national economy and rapid investigation of reality instead of generalizations.
At the end of the nineteenth century it was established the marginal utility school under the influence of economists as William Stanley Jevons, Carl Menger and Leon Walras. For the first time there were themed the beginnings of microeconomics, such as individual estimates of utility and function of supply and demand.
Since then, methodological problems were a fair support of the economy, along with content and political reconciliation issues. Under the influence of the way of thinking of marginal utility school, classicism was developed and created neoclassicism, having as representative Alfred Marshall that combined in equilibrium analysis the subjective aspects of school of marginal utility with the objectives theories of classics .
From Keynes to today
John Maynard Keynes offered to political actors a useful theory to overcome the economic crises through an active economic policy of the state and set up Keynesianism. Neoliberalism has developed in parallel, based on liberalism as a political counterbalance.
Ordoliberalism occurred after neoliberalism and provided the concept of social market economy. In the 60s, Milton Friedman founded the monetarism.
Latest and lesser known trends are debitism, free economy, economy of evolution and new institutional economics.