A Comparison of the Economic Theories of Adam Smith and...

There is perhaps not a more famous ongoing dialectic argument in the field of political economy than the one between Adam Smith and Karl Marx in regards to capitalism. The two thinkers, although coming to radically different conclusions about the outcomes of the capitalist system for all parties involved, agree on a surprising number of ideas such as labor being the source of commodities’ value, as well as the fact that the division of labor increases productivity. However, their different conceptions of what determines the price of a commodity, the driving force behind and the effects of the division of labor, and the purpose of the capitalist system have widespread implications that cause their holistic arguments to diverge considerably. Marx’s analysis of capitalism begins with an investigation of the commodity because the wealth of capitalist nations is essentially â€Å"an immense collection of commodities† (Chapter 1). Marx differentiates between the use-va lue and the exchange-value of any given commodity. The use-value of a commodity refers to its qualitative ability to satisfy a human need, while its exchange-value is the â€Å"quantitative relation†¦ in which use-values of one kind exchange for use-values of another kind† (Chapter 1). Therefore, exchange-value is not an intrinsic quality of a commodity; it is only discovered in comparing a fixed quantity of commodity A to a fixed quantity B. Since differing quantities of these two commodities appear to have the same value,Show MoreRelatedSmith vs. Marx - a Comparison Essay1247 Words   |  5 PagesSmith versus Marx Ââ€" A Comparison S. Glen Balanoff July 04, 2004 Smith versus Marx Ââ€" A Comparison Modern economic society can be described as a combination of certain points from several theories combined into one. Changing dynamics and economic needs of nations has spawned a development of various, and contrasting, economic systems throughout the world. Perhaps the two most contrasting philosophies seen in existence today are that of capitalism and communism. The two philosophers most notablyRead MoreEssay about Karl Marx and Adam Smith: Division of Labour1117 Words   |  5 PagesKarl Marx and Adam Smith: Division of Labour A nation is just a vast establishment, where the labour of each, however diverse in character, adds to the wealth of all. Two brilliant people of their time are both respected in their views for creating a near perfect society where everyone is happy. Adam Smith, a respected Scottish political economist philosopher born in 1723, had the goal of perfect liberty for all individuals through the capitalistic approach. While Karl Marx, born in 1818Read MoreKarl Marx And Adam Smith Essay1639 Words   |  7 PagesPresence of the Theories of Karl Marx Adam Smith Within the Canadian Economy Written by: Jason Kothary, Zach Shafi, Sam Girma Kevin Sallaku Research: Ryan Salehi, Zack Izzeddin, David Moffett, Cameron Bernardo, Harrison Toms, Taha Mahmood, Anthony Alexiou, Jason Kothary, Zach Shafi, Sam Girma Kevin Sallaku Canada’s economy is one that exhibits a multitude of characteristics that adhere to the capitalist and socialist constructs of a mixed system. In order to clearly define and analyze theRead MoreEssay A Comparison of Capitalism and Marxism637 Words   |  3 PagesA Comparison of Capitalism and Marxism This essay will compare the economic principles of capitalism and communism by giving brief historical background on both and describing the two. I will begin with the father of economy, Adam Smith, and finish with the theories of Karl Marx. Adam Smith believed that if everyone behaves selfishly we are doing what is best for the economy of our society. This is what is known as â€Å"enlightened selfishness.† â€Å"Enlightened selfishness† is one of the main elementsRead MoreMarx vs Smith2023 Words   |  9 Pageshistory, economists have debated over various theories, in an effort to discover the one solution that will achieve the most efficient and beneficial economy. One school of thought titled, Classical Economics, is infamous has been called the â€Å"first modern school of economic thought.†[1] Two economist/philosophers who have been placed within this Classical category are Adam Smith and Karl Marx. Though these two men are polar opposites in the political-economic spectrum they share some similarities; andRead More A Comparison of the Economic Philosophies of Adam Smith, John Stuart Mill, and Karl Marx1781 Words   |  8 Pageswhich within its structure lie the inner dwellings of divisio n of labor and societal classes. Adam Smith (18th Century), John Stuart Mill (19th Century), and Karl Marx (19th Century) are of the same cloth, but in modern terms their community is referenced as a government, and they each have their own distinct opinions on the drive instilled within human nature that shape their personal economic theories. I will be dissecting the views of each of these economists, in regards to the role of governmentRead MoreEconomics And The Classical System2361 Words   |  10 Pages1. Economics would be better described by a variation on the term ‘chrematistique’ rather than our current discipline’s name, which stems from ‘oeconomica’ because there is a â€Å"natural† way of making money and the â€Å"unnatural† way of making money. In the book Teachings From The World Philosophy it states that there are the elements of true wealth but there is also another art of acquisition, which is commonly and rightly c alled the art of making money (Heilbroner 8). I believe that there is a meritRead Morewhat is profit? where do profits come from? Essay2087 Words   |  9 Pagesï » ¿ECOP1001 Economics as a Social Science Essay The essay should compare Two different schools of economic thoughts Question 4. What is profit? Where do profits come from? Economic theories simplify the relations among key economic concepts and enable us to understand different economic concepts. Throughout history, different economists in different time periods have formed diverse thoughts on how markets work by building and improving on the work of those who came before them. Therefore inRead MoreJohn Locke : The Father Of Classical Liberalism1790 Words   |  8 Pagesequality under our current capitalistic economic relations. John Locke is often noted as the father of classical liberalism – of which other forms of liberalism came from – due to his influential works in favour of ideas that reflect what is now known as liberalism. Alongside Locke, Karl Marx is commonly thought of as an iconic proponent of socialism; another quite common political ideology. Socialism advocates social ownership and total democracy for economic production alongside individual equityRead MoreThe Rise Of Capitalism : Karl Marx2134 Words   |  9 PagesKarl Marx is the first in a series of 19th and 20th century theorists who started the call for an empirical approach to social science. Theorizing about the rise of modernity accompanied by the decline in traditional societies and advocating for a change in the means of production in order to enable social justice. Marx’s theories on modernity reveals his beliefs of modern society as being influenced by the advancement of productive forces of modern industry and the relationships of production between