Structural changes in economics during the last fifty years

1.0. The pre-classical economics: The pre-classical economics, if this term can be used to denote an enquiry regarding the system of livelihood of the people and forces determining their prosperity that existed before the rise of science and industrial revolution, can be summarized in terms of the “Closed system-Caste-Power-Religion-Custom ” nexus. The economic life of the commoners/laity was controlled by the nobility (or aristocracy) or the clergy (religious heads); tradition-bound it went in a perpetual cycle without much development for a very long time. This circularity gave rise to ‘caste ’ – tying of the type of livelihood to birth in a social group (see Knox on the medieval society in the western civilization). The rise of science and the industrial revolution overthrew the power of the state as well as the priests and destabilized the age-old caste system. Power went into the hands of the industrialists and the formation of ‘economic class ’ began. These developments gave rise to economics as a new scientific enquiry. The subsequent development of economics as a structure of thought can be phased into (i) the classical synthesis (of pre-classical, Mercantilist and Physiocratic doctrines), (ii) The Marxian antithesis, (iii) the neoclassical reconstruction and orthodoxy, (iv) the “old ” institutionalism, (v) the Keynesian antithesis, (vi) Keynesian economics-in the sense of Axel Leijonhufvud (1968),