The popular belief that Adam Smith was the first founder of political economy is correct in part. He is certainly an ancestor of classical, neo-classical, and Marxist economics. We, nevertheless, assert that Sir James Steuart is an alternative to Smith, and thus is one of the first political economists. He created the primitive equilibrium theory and a system of monetary theory. Although Steuart and Smith formed contrasting economics, they constituted a common system of political economy in relation to political and social affairs. In this, they were the institutional economists. We should in particular evaluate this aspect of Principles' monetary theory.
