The Physiocrats
Toward the last part of the 18th century in France a small group of individuals, most of whom were in academic or government positions, evolved a common set of ideas about an economy and national wealth. Referring to themselves as “economists,” these individuals were the first to employ the extraction of conclusions from a deductive approach. Here is found the genesis of modern, neo-classical economic thinking. In this precept, one assumes that choices are made rationally and one can then proceed to use deductive reasoning to construct theories about prices, employment, output and other variables. Parker and Stead,12 write that the term physiocrat is of Greek origin meaning the rural of nature. “The physiocrats believed in the overriding importance in economic affairs of nature and its laws.”