This paper will trace the history and development of the theory of rent as set forth by David Ricardo. The earliest school of economics was that of the physiocrats, an 18th century group who paved the way for Adam Smith and the economic theorists of the next hundred years. The essence of the physiocratic system lay in the concept of a God-ordained natural order, in which every social fact had its place. A person’s first obligation was to understand this order; the next was to conform to it. This order was the revelation of an inner principle, not the result of external observation. The physiocrats’ respect for property and authority reflected their belief in the natural order..

Every undertaking involved a certain expense. Wealth was spent in the production of new wealth. This expense, subtracted …