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On the Principles of Political Economy and Taxation (Annotated)

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• NOTE: This classic work contains annotations

On the Principles of Political Economy and Taxation (Third Edition) is a book by David Ricardo on economics. The book concludes that land rent grows as population increases. It also clearly lays out the theory of comparative advantage, which shows that all nations can benefit from free trade, even if a nation lacks an absolute advantage in all sectors of its economy.

Ricardo claims in the preface that Turgot, Stuart, Adam Smith, Jean-Baptiste Say, Sismondi, and others had not written enough "satisfactory information" on the topics of rent, profit, and wages. Principles of Political Economy is ostensibly Ricardo's effort to fill that gap in the literature. Regardless of whether the book achieved that goal, it secured, according to Ronald Max Hartwell, Ricardo's position among the great classical economists Adam Smith, Thomas Robert Malthus, John Stuart Mill, and Karl Heinrich Marx

David Ricardo (1772 – 1823) was a British political economist and stock trader. He was often credited with systematizing economics, and was one of the most influential of the classical economists, along with Thomas Malthus, Adam Smith, and John Stuart Mill. He was also a member of Parliament, businessman, financier and speculator, who amassed a considerable personal fortune. Perhaps his most important contribution was the law of comparative advantage, a fundamental argument in favor of free trade among countries and of specialization among individuals. Ricardo argued that there is mutual benefit from trade (or exchange) even if one party (e.g. resource-rich country, highly skilled artisan) is more productive in every possible area than its trading counterpart (e.g. resource-poor country, unskilled laborer), as long as each concentrates on the activities where it has a relative productivity advantage.