On the Origins of the Political Economy

Abstract

The scholars of the History of Economic Thought, irrespective of their ideological school, have always regarded Adam Smith as the founding father of the discipline of political economy. Particularly, the first seeds of the economics discipline were believed to be sowed by An Inquiry into the Wealth of Nations (1776) by Adam Smith. However, a more profound analysis and evaluation of the historical sources could counteract this widely-held belief of Adam Smith as the founding father of the political economy. There has been a growing body of literature that has sparked a debate about Al-Muqaddimah (1377), the book of a fourteenth-century scholar called Ibn Khaldun who provided labor theory of value, theory of profits, prices and taxation together with a monetary theory. Some scholars went so far as to argue that Ibn Khaldun should be considered as the father of the political economy. Yet, there remains fundamental questions as to why Ibn Khaldun’s book Al-Muqaddimah, and thus his theories of economic principles were not picked up by the classical political economist. In other words, what made Al-Muqaddimah so obscure and unknown throughout the history that the classical political economists had to re-discover these principles? Were there any differences in the ways Ibn Khaldun and classical political economists wrote and presented their theories of division of labor and prices? Why did the origins of the political economy spring in the Western civilizations rather than the East? This paper will try to argue that as much as Ibn Khaldun put forward theories of division of labor, prices, profits and taxation in Al-Muqaddimah, it should not be considered as the origins of the modern political economy, because Ibn Khaldun seemed not to be concerned about changing the status quo he was living in, but rather attempted to provide a descriptive account in the society and time period he was living in. Thus, he became obscure and unknown to both Eastern and Western civilizations throughout the history, because he was not concerned with revolutionizing the human thought and philosophy. On the other hand, Adam Smith and his successors were products of the Scottish Enlightenment in which they attempted to change the way people viewed the political and societal system around them. In other words, the argument that Ibn Khaldun should be considered as the father of modern economics does not matter. The historical context and the goals of both Ibn Khaldun and the classical political economists matter. This issue is significant to address, because it not only provides with a deeper understanding of the origins of economic thought, but also enables us to question the standard textbook narrative.