3 most influential economists (Essay Question 1)

T or F: in a communist society, all workers would contribute according to their ability and would receive benefits according to their need

T

Marx's thesis

the divine right of kings

four fundamental points of Adam Smith's capitalism philosophy

-creation of wealth is properly the concern of private individuals, not the govt -the resources used to create wealth must be owned by private individuals -economic freedom ensures the existence of competitive markets that allow both sellers and buyers to enter and exit as they choose -the role of the government should be limited to providing defense against foreign enemies, ensuring internal order, and furnishing public works and education

Marx's Synthesis

-revolution -socialism -communism

who are the 3 most influential economists?

Adam Smith Karl Marx John Maynard Keynes

T or F: Adam Smith is considered the father of economics

T

T or F: Marx advocated a classless society whose citizens together owned all economic resources

T

T or F: John Maynard Keynes was the father of communism

F: Karl Marx

Keynes theory

He saw the economy as unable to maintain itself at full employment and believed that it was necessary for the government to step in and put under-utilised savings to work through government spending.

the great depression =

Keynes

Marx's antithesis

Laissez Faire

the industrial revolution =

Marx

mercantilism =

Smith

who wrote "the wealth of nations"

Smith

the invisible hand

a metaphor conceived by Adam Smith to describe the self-regulating behavior of the marketplace. Individuals can make profit, and maximize it without the need for government intervention.

what is a "market economy" and what economist supported this idea?

an economic system in which businesses and individuals decide what to produce and buy, and the market determines quantities sold and prices Smith

Keynes believed that the government needed to create ______ to stimulate consumer spending and jumpstart the economy

jobs, mostly pertaining to fixing the infrastructure of the nation. putting people to work leads to people purchasing essentials for their family (food, domestic goods, etc) which leads to an increase in demand and production, stimulating the economy

laissez faire

there should be no interference in the economy by outside forces (govt)

Keynes believed in the ______ theory

trickle up theory

Smith argued that society's interests are best served when?

when the individuals within that society are allowed to pursue their own self-interest