David Ricardo (18 April 1772 – 11 September 1823) was a British political economist. He was one of the most influential of the classical economists, along with Thomas Malthus, Adam Smith, and John Stuart Mill. He began his professional life as a broker and financial market speculator. He amassed a considerable personal fortune, largely from financial market speculation and, having retired, bought a seat to enter Parliament. He held the seat for the last four years of his life. Perhaps his most important legacy is his theory of comparative advantage, which suggests that a nation should concentrate solely on those industries in which it is most internationally competitive, trading with other countries to obtain products which are not produced nationally. Ricardo's theory of Comparative Advantage attempted to prove, using simple mathematics, that industry specialization and international trade always produce positive results. This theory expanded on the concept of absolute advantage which does not advocate specialization and international trade in all cases. Ricardo's theory of comparative advantage has been challenged by, among others, Joan Robinson and Piero Sraffa, but remains the corner stone of the theoretical argument in favour of international free trade.
Born in London, England, Ricardo was the third of 17 children of a Sephardic Jewish family of Portuguese origin who had recently relocated from the Dutch Republic. His father was a successful stockbroker. He began working with his father at the age of 14. At age 21, Ricardo eloped with a Quaker, Priscilla Anne Wilkinson, and became a Unitarian, leading to estrangement from his family. His father disowned him and his mother apparently never spoke to him again.
Following his estrangement from his father he started a successful business as a broker with the support of an eminent banking house. He made the bulk of his fortune as a result of speculation on the outcome of the Battle of Waterloo, using methods which today would result in prosecution for insider trading and market manipulation. Prior to the battle, Ricardo posted an observer to convey early results of the outcome, he then deliberately created the impression the French had won by openly selling British securities. A market panic ensued. Following this panic he moved to buy British securities at a steep discount. The Sunday Times reported in Ricardo’s obituary, published on 14 September 1823, that during the Battle of Waterloo Ricardo "netted upwards of a million sterling". Following this coup, he retired from business. He was 41. He purchased Gatcombe Park, an estate in Gloucestershire, now owned by Princess Anne, the Princess Royal. He was appointed High Sheriff of Gloucestershire for 1818–19. At the time of his death his fortune was estimated at about £600,000.