Principles of Economics

Principles of Economics is a leading political economy or economics textbook of Alfred Marshall (1842-1924), first published in 1890. It ran into many editions and was the standard text for generations of economics students.
Marshall began writing the Principles of Economics in 1881 and he spent much of the next decade at work on the treatise. His plan for the work gradually extended to a two-volume compilation on the whole of economic thought; the first volume was published in 1890 to worldwide acclaim that established him as one of the leading economists of his time. The second volume, which was to address foreign trade, money, trade fluctuations, taxation, and collectivism, was never published at all. Over the next two decades he worked to complete his second volume of the Principles.
Marshall’s influence on modifying economic thought is difficult to deny. He popularized the use of supply and demand functions as tools of price determination; modern economists owe the linkage between price shifts and curve shifts to Marshall. Marshall was an important part of the “marginalist revolution;” the idea that consumers attempt to adjust consumption until marginal utility equals the price was another of his contributions. The price elasticity of demand was presented by Marshall as an extension of these ideas. Economic welfare, divided into producer surplus and consumer surplus, was contributed by Marshall, and indeed, the two are sometimes described eponymously as ‘Marshallian surplus.’ He used this idea of surplus to rigorously analyze the effect of taxes and price shifts on market welfare. Marshall also identified quasi-rents.