ANALYSIS OF THE HISTORY OF ECONOMIC THOUGHT IN THE PRE-
CLASSICAL PERIOD
Daniel Alves
ECON 350 - Classical Economics
June, 2024
Introduction
The history of economic thought has come a long way. This thinking began thousands
of years ago, when humans began to manage the resources they had to meet their needs. This
history then became the forerunner of the birth of economic thought in the aftermath until
now. Records of ancient economic concepts and thoughts can be found in religious teachings,
legal rules, and moral rules. One of the economic thoughts that emerged in the past was the
Pre-Classical school of economic thought. Pre-Classics is considered a milestone in the
emergence of thought in the field of economics. Although fairly simple, but its existence in
the history of economic thought has become a guideline, learning, or inspiration for economic
thought in later times. Pre-classical economic thought, which consists of mercantilist and
physiocratic schools, seeks to give birth to ideas or economic thought that is very extreme, an
economy full of government autocracy on the one hand and a free economy without
government intervention at all.
Research Methods
This research uses quantitative data. Data collection in this study used document
study techniques and library research both from the internet, books or other websites. The
data analysis technique used is descriptive analysis intended to describe several keywords
that have been described in the research using the help of several experts' opinions.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
Results And Discussion
Pre-Classical Economic Thought
Pre-Classical Economic Thought is a group of thoughts that emerged from economic
experts or figures before the Classical school. This economic thought has appeared for a long
time, namely since the time of Ancient Greece. The Pre-Classical school of economics can be
divided into four parts, namely the thought of Ancient Greece, the thought of the
Scholastics, the era of Mercantilism, and the Physiocratic school. The four sub-streams are
early thoughts about economics, before economics was established as a separate branch of
science. In the pre-classical period, economic thoughts can be grouped into the Ancient
Greek period, scholasticism, mercantilism and the physiocratic period.
Ancient Greece
In Ancient Greece, discussions about economics were still part of philosophy, especially
moral philosophy. Economic thinking is based on a sense of justice, worthiness, and
compliance that needs to be considered in order to achieve a just and prosperous society. The
flow of economics, which is often referred to as the flow of philosophy, is characterized by
the emergence of the thoughts of Greek philosophers who have given their thoughts to
economic problems. Although the results of their thoughts on economic issues are not so
much, they have provided something very valuable, especially as a pioneer in the study of
economics in a more scientific and fundamental manner.
The famous figures of this period are Plato, Aristotle, Xenophone.
Plato
Plato, a famous philosopher, had the mindset of a noble. He looked down on manual laborers
and those who pursued wealth, including through trade. Plato's ideas on economics arose
from his thoughts on justice in an ideal state. Plato said that in an ideal state, progress
depends on the division of labor intended for the development of human qualities. Plato can
be said to be a person who strongly criticizes wealth and luxury.In order for everyone to live
prosperously equally, it is necessary and obligatory for humans to control their greed to fulfill
all desires that exceed reasonableness. If this greed cannot be controlled, then some people
will live in luxury, while others will live in misery & humiliation. In his book, Politika, Plato
explains that apart from being a medium of exchange, money also functions as a measure of
value and a tool for hoarding wealth. Plato asserts that the economic perspective is related to
the philosophy and ethics of how to uphold community justice in an ideal state. The division
of labor in society is "natural" in the form of wages, money, services.Plato gives 'attention' to
the behavior of "hedonism", unbridled greed (especially in clever people) will create some
people living in luxury, while others live in difficulty. The Division of Labor theory
developed by Adam Smith was derived from Plato's view. The difference is that Smith's
version of the division of labor is aimed at spurring output growth and economic
development. While Plato's division of labor is aimed at developing the quality of humanity.
Aristotle
Aristotle was a philosopher who was a student of Plato. He was the first to see that
economics is a separate science whose discussion must be separated from other sciences.
Aristotle is also considered to be the first person to lay the basic idea of the theory of value
and price, which is still studied in economic theory today.According to Aristotle, economics
is a separate field, whose discussion must be separated from other fields. He was also the one
who laid down the basic idea of the theory of value and price. The exchange of commodities
and the use of money in the exchange of goods. Aristotle distinguished the economic process
into two branches, namely use and gain. More specifically, he distinguished oeconomic and
chrematistic. Oeconomics is defined as "the art of house-hold management, the
administrations of one's patrimony, the careful comparison of resources". While chrematistics
implies the use of natural resources or human skills for acquisitive purposes in chrematistics.
Xenophon
Xenophone (440-355 BC) was a Greek philosopher who introduced the term economics
which comes from the combination of two syllables, namely oikos and nomos which means
"the organization or incorporation of a household". Xenophone was also known as a soldier,
historian, and student of Socrates. According to Xenophon, the word economy comes from
the Greek words Oikos and Nomos, which means the arrangement or management of
households. His main work is On The Means of Improving The Revenue of The State of
Athens. In the book, Xenophon outlines that the state of Athens which has several advantages
can be utilized to increase state revenues. Xenophone's use of the term "oikonomos" (from
the words oikos and nomos) regulates or manages the household.laid the fundamentals of the
concept of customer service in business and introduced the need to trade outside the region
(the basic concept of mercantilism).
Scholastic Period
Scholastic thought emphasizes the strong relationship between economics and ethical issues,
as well as a great deal of attention to issues of justice. The scholastic economic perspective is
an economic perspective related to moral, ethical and religious values. In medieval Europe, as
the Roman Empire began to crumble, economic activity began to adjust to the new structure
of society. At this time the church was very instrumental in determining moral rules. And the
scholastic teachings themselves were heavily influenced by religious teachings. Thus,
economic behavior is strongly influenced by the teachings of the church. The main
characteristic of this school is the strong relationship between economics and ethical issues
and the amount of attention to the problem of justice. Scholastic figures were strongly
influenced by church teachings which were more dominant than economics. At that time
education was left to church figures known as "The Scholastics", so this period is called the
scholastic era.The scholastic era paid attention to the negative impact of economic motives
(which tend to lead to greed and luxury, if uncontrolled). This is because the figures of the
school were strongly influenced by the teachings of the church. The figures of this school
include St. Albertus Magnus, and St. Thomas Aquinas.
St. Albertus Magnus
Albertus Magnus was a German philosopher who argued that the price of a good should be
equal to the cost and labor sacrificed to create that good. This opinion is known as "fair and
reasonable price".
St. Thomas Aquinas
In his book Summa Theologica, Thomas Aquinas argues that charging interest on money lent
is unjust because it is tantamount to selling something that does not exist. This view is similar
to that of Aristotle who condemned the charging of interest, because interest is the profit from
something that is done without effort and cost.
The Age of Mercantilism
The term mercantilism comes from the word merchant which means trader. According to
mercantilism, every country that wants to develop must trade with other countries.
Mercantilism was widely adopted in European countries in the 16th century, including
Portugal, Spain, England, France and the Netherlands. The period of mercantilism is
characterized as a period in which each person became his own economist.
Jean Bodin
According to him, the increase in money earned from foreign trade can cause the price of
goods to rise. In addition, the increase in the prices of goods can also be caused by
monopolistic practices and luxurious lifestyles of nobles and kings. In these practices, the
people are usually the victims, so they were highly criticized at the time. Jean Bodin's theory
of the value of money was considered very advanced, so in an interval of about half a
century, Irving Fisher used it as the basis for his theory, namely the quantity theory of money.
Thomas Mun
According to Mun, to increase the wealth of a country, the usual way is through trade. He
believes that the value of exports out of the country should be greater than what the country
imports. According to him, trade can still be profitable even if you don't have gold and silver,
by making payment transactions through banks. What is used as collateral for credit is the
commodity being traded (barter perhaps).A country that has too much money is not good
because it raises prices, and although the increase will increase the income of businessmen,
the increase is not good.
In general, it is immediately detrimental and reduces the volume of trade, as high prices
reduce consumption and demand.
Jean Baptist Colbert
He encouraged business in the craft and trade sectors by emphasizing the imposition of
import duties, with the aim of subsidizing French transport ships, expanding the French
colonies, and improving the domestic transportation system. To support this policy, a large
and cheap labor force was needed, so French workers were prohibited from leaving the
country, while immigrants from abroad were encouraged to enter the country.
David Hume
In his theory, Hume is very concerned with the factor of justice, and thinks that injustice will
weaken a country. If there is no justice, then the wealth owned by the rich will be
redistributed to the poor. In this way, the justice that Hume wanted can be implemented.
The term "mercantilism" comes from the word merchant, which means "trader". According to
mercantilism, every country that wishes to develop must trade with other countries. The
source of the country's wealth will be obtained through the surplus of "foreign trade" which
will be received in the form of gold or silver. For mercantilists, the source of the country's
wealth is from foreign trade. Furthermore, money as a result of trade surplus is the source of
power. Mercantilism was widely practiced in European countries in the 16th century,
including Portugal, Spain, England, France and the Netherlands. They not only traded with
fellow European countries, but also to the Dutch East Indies (Indonesia at that time). As we
know, the purpose of European countries conducting trade missions to Indonesia was initially
to compete for spices. However, to secure these trade routes, they ended up colonizing. One
thing worth noting during the mercantilist era is that not only did trade and the economy
advance rapidly, the development of literature also increased tremendously. Progress in
economic writings advanced, both in quantity and quality. The mercantilist era was
characterized as a period when every man was his own economist. Everyone had their own
opinion, and unfortunately it was very difficult to generalize.
Physiocratic period
The physiocrats considered that the source of wealth was natural resources. This school is
named physiocratism, which is a combination of two words physic (nature) and cratain or
cratos (power), which means those who believe in the rule of nature. Natural laws full of
harmony and harmony apply anytime anywhere and in any situation (cosmopolite).The main
figure of the physiocratic school was Francis Quessnay (1694-1774). In 1758 Quessnay wrote
the book Tableau Economique.
In the book, Quessnay describes the economic system of an economy The state is like the
biological life of the human body. Between one part of the body with other parts forming a
harmonious unity. Likewise, the processes and symptoms of economic life when seen in the
relationship between one part and another form a whole with hidden laws.
Society is divided into four classes:
The productive class of society, which is a society that actively cultivates land such as
agriculture and mining.
Landlord class
The unproductive class or sterile class, consisting of merchants and artisans
The class of laborers who receive wages and salaries for their labor Quesnay advocated
that policies taken by the government should be aimed primarily at improving the
standard of living of peasants, not giving special rights to landowners and merchants so
far enjoyed under mercantilism. The physiocrats criticized the mercantilists for creating
trade regulations when they should have been exempted from control. The mercantilists
were seen as making goods more expensive by imposing high taxes.
The Physiocrats implemented a single tax, which was imposed only on landowners. A high
tax is recommended so that people do not have the desire to control excessive land.
The Physiocratic school first emerged in France towards the end of the mercantilist era that
began in 1756. The term ´physiocrat´ comes from the Greek, from the words ´physia´
meaning nature, and ´kratos´ meaning power. It literally means ´supremacy of nature´. Its
figurehead was Francois Quesnay (1654-1774), a French surgeon who was once the personal
physician of King Louis XV, as well as the confidante of the king's mistress, Madame de
Pompadour. Besides his profession as a doctor, he was an economist who wrote his article
´economic science´ in the Grande Encyclopedie. Quesnay criticized Colbert's economic
policies, saying it was not proper for a minister to issue policies driven only by jealousy of
the success of Dutch trade and the beauty of the luxury goods industry. This would only
plunge the French state into deep ignorance, where the people could only talk about ´trade´
and ´money´. All this was due to Colbert who had destroyed the economy of the French
people. The core of this physiocratic teaching is essentially based on natural law. Just as Isaac
Newton (1643-1727) had discovered the laws of the physical world, Quesnay believed that all
the laws of the world were based on the laws of nature human activities must be brought into
harmony with natural law. The core of the teaching is:
The motto laissez-faire, laissez-passer originated by Vincent de Gournay (1712-1759)
whose connotative meaning of ´let people do as they please without government
interference´ implies that the government must limit itself in its intervention in the
economy is clearly contrary to mercantilists, as well as feudalists.
Pressure on the productive agricultural sector that allows for a surplus or net product
above the value of resources used.
Although the French economy is not getting better, the physiocrats have made a
meaningful contribution to the development of economics, especially in the motto
laissez-faire, physiocrats turn the attention of economists to the problem of the role of
government in an economy based on free competition and freedom of choice and
decision making (Sastradipoera in Dadang Supardan, 2009: 394-395).
Conclusions
As is well known, the word "Economy" itself comes from the combination of two Greek
syllables: Oikos and Namos, which means "the organization or management of a household".
The term was first used by Xenophone, a Greek philosopher. In ancient Greece the discussion
of economics was indeed part of philosophy, especially in the moral philosophy section.
Thoughts about economics at that time were often associated with a sense of justice,
feasibility or appropriateness that needed to be considered in order to create a just and
prosperous society equally. In Ancient Greece the discussion of Economics was indeed part
of philosophy, especially in the moral philosophy section. Thoughts about Economics at that
time were often connected with a sense of justice, feasibility or appropriateness that needed
to be considered in order to create a just and prosperous society equally. In ancient Greece,
theories and thoughts about money, interest, human labor services from slavery and trade
already existed. Then the opinions of economists complemented the pre-classical economic
thought process.
