Aristotle’s Macroeconomic Model

Hidden in Aristotle’s Politics there is a macroeconomic model of the economy of the city-state. The elements of which this model in constructed are the following: the territorial size of the city, the division of the land between public and private, the size of the population and the Aristotelian notion of good life. The model describes the long-run equilibrium position of the economy of the city-state, which is reached through changes in population. The equilibrium position is not a result of individual actions based on maximizing behavior and technological parameters but a result of population changes and implicit technological parameters. Population changes occur by means of birth control policies Aristotle’s ideas on population in relation to the welfare of the city have received much less attention than the other parts of his economic thinking. Although reference is often given to his suggestion for birth controls ( e.g. Spengler and Allen, 1960) this part of economics is largerly neglected. Malthus does not even mention Aristotle, despite the similarity of some of his arguments to those of Aristotle.. As it has been recently noted “In the Politics, population is a recurring topic, extensively discussed and integral to the overall argument” (Kreager, 2008). The present paper makes explicit the central role of population changes to the economy of the city-state.