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The dominant approach in economics, often referred to as neoclassical economics, gradually acquired its leading status in the years following the publication of Lionel Robbins’ (1932) famous essay on the nature and significance of economic science. In this essay Robbins argued that economics should be about the efficient allocation of scarce resources, rather than about resource creation and the creation and distribution of wealth as advocated by classical economists such as Adam Smith, David Ricardo and Karl Marx. As Robbins saw it, a focus on scarcity and efficient allocation would delimit economics more clearly from other social sciences and also render it more amenable to scientific and mathematical investigation, particularly once certain subsidiary assumptions such as rational behaviour by economic agents were made.

Capabilities, resources, learning and innovation: a blueprint for a post-classical economics and public policy