Analysis of economic growth was the primary concern of Adam Smith, who emphasized the relationships between free markets, private investment spending, laissez faire, and economic growth. Ricardo refocused economics, turning it away from economic growth and toward the issue of the forces determining the distribution of income. This change in viewpoint
between Smith and Ricardo concerning the essential subject matter of economics was fundamentally a reorientation of economics away from the growth macroeconomics of Smith and toward Ricardo’s microeconomic concerns—what determines wages, rents, profits, and other prices, and thus the distribution of income. This emphasis on microeconomics, the allocation problem, continued to dominate mainstream economic thought from Ricardo in the first quarter of the nineteenth century until the major depression that engulfed the industrialized world in the 1930s.