This presentation presents the life of an economist, David Ricardo. It also shows his works and how they contributed the economy.

1. DAVID RICARDO

2. David Ricardo was born in April 19, 1772. He was the
third of seventeen children.
He died in September 11, 1823 at the age of 51.
At the age of 27, after reading Adam Smith’s The
Wealth of Nations, Ricardo got excited about
economics.
He wrote his economic article at age of 37, firstly in
The Morning Chronicle.

3. David Ricardo retired from business in 1814 and was
elected to the British parliament in 1819 as an
independent representing a borough in Ireland, which
he served up to his death in 1823. In parliament, his
main interests were in the currency and commercial
questions of the day.

4. Contributions:
Ricardian equivalence
Labour Theory of Value
Comparative Advantage
Law of Diminishing Returns
Economic Rent

5. Ricardian equivalence
• Also known as the Ricardo- de Viti- Barro
Equivalence Theorem states that government
deficits are anticipated by individuals who
increase their savings because they realize that
borrowing today has to be repaid later.

6. Labour Theory of Value
• Is a theory of value which argues that the
economic value of a good or service is
determined by the total amount of socially
necessary labor required to produce it, rather
than by the use or pleasure it owners get from

7. Comparative Advantage
• It is an economic theory about the work gains
from trade for individuals, firms, or nations that
arise from differences in their factor
or technological progress.
• The idea is- a country that trades for products
can get at lower cost from another country is
better off than if it had made the products at
home.

8. Law of Diminishing Marginal Returns
 In his essay on the influence of a low price of corn
on the profits of stock(1815), he articulated what
came to be known as the law of diminishing
marginal returns. One of the most famous laws of
economics, it holds that as more and more
resources are combined in a production with
resources- for example, as more labor and
machinery are used on a fixed amount of land-
additions to output will diminish.

9. Economic Rent
• Any payment to a factor of production in
excess of the cost needed to bring that
into production.

10. References:
http://www.famouseconomists.net/david-ricardo
http://www.investopedia.com/terms/r/ricardianequivalence.asp
http://www.econlib.org/library/Enc/bios/Ricardo.html