The nascent period of Western economics (15th to mid-17th century)

During the period of mercantilism, people believed that wealth was precious metals, and the gold and silver traded in the circulation field were wealth, thus drawing the conclusion that wealth was generated in the circulation field. Therefore, mercantilism emphasizes that if a country wants to become rich, it must attach importance to business; at the same time, it restricts the outflow of precious metals through various methods, and proposes that the state should actively protect and intervene in economic activities, that is, use the power of the state to fight Large exports and restricted imports.

The formation period of Western economics (mid-17th century to 1870s)

Labor in any department is the source of national wealth, and wealth is a material product. That is to say, a complete theoretical system based on the labor theory of value is clearly proposed. The center of the research is how to increase national wealth, emphasizing that to increase national wealth, Production must be developed by increasing capital accumulation and division of labor; and it advocates that the country should adopt a laissez-faire attitude towards economic activities and regulate economic operations through the "invisible hand" of price, so that people can realize their goals in the process of pursuing their own interests. The rational and effective allocation of social resources puts forward the idea of ​​economic liberalism.

The formation and development period of microeconomics (1870s to 1930s)

Neoclassical economics believes that although the market will deviate from equilibrium at a certain time under the influence of certain external forces, due to the role of the price mechanism, the market will eventually return to equilibrium. This is the state that the market should be in under normal circumstances. Therefore, the neoclassical school of economics advocates: believe in the market and let the market mechanism play its role; the price mechanism can not only make various production factors get their due rewards, so that consumers can get the greatest satisfaction, but also can achieve their own goals through self-regulation. Adjustment eliminates cyclical economic fluctuations. Therefore, the state should not intervene in economic activities, because such a mechanism can create an ideal economic society and reach the optimal state. State intervention cannot make it better and will only interfere with the normal operation of the economy.

Modern Western economics is marked by the emergence of Keynesianism in the 1930s. The center of this period was the formation and development of macroeconomics. This stage can be divided into four small periods.

(1) Keynesian Revolution Period (1930s-1950s)

(2) Keynesian development period (1950s-1960s)

(3) The revival period of laissez-faire thought (early 1970s)

(4) Institutional economics period (late 1980s)