Economic Theory and Socialism
What is lassez-faire economics?
Free Enterprise, "Let it be or leave it alone"
Why did some people think lassez-faire economics were not the best?
Workers were being exploited and laws were not doing enough.
Who wrote "Wealth of Nations"?
Adam Smith
Who's idea was free enterprise?
Adam Smith
Who wrote "An Essay on the Principle of Population"?
Thomas Malthus
Iron Law of Wages
"As populations grow, more workers become available and wages drop"
When was the "Wealth of Nations" published?
1776
When was "An Essay on the Principle of Population" written?
1798
When did David Ricardo write "Principles of Political Economy and Taxation"?
1817
When were the Combination Acts repealed?
1825
Under socialism, what does the government own?
All the factors of production
What is free enterprise?
Be free to engage in any business with no interference
Who is Jeremy Bentham (1748-1832)?
Believed in Utilitarianism- laws were good if they led to the greatest happiness to the greatest number of people. Advocated individual and economic freedoms.
What were the the theories of Karl Marx?
Believed the entire capitalist system should be destroyed.
Who was John Stuart Mill (1806-1873)?
Believed the government should work for the good of all people. Rejected economic systems that left people trapped in poverty. Argued for full democracy, equality for all men and women, protect men and women in the factory Promote education and guarantee individual liberty
Who was Thomas Malthus?
British professor and clergy of economics. Wrote "An Essay on the Principle of Population" in 1798
What was the cause of the proletariat receiving only a small portion of the wealth they create?
Capitalism
What did "Wealth of Nations" discuss?
Creation of wealth through manufacturing and agriculture
Who wrote "Principles of Political Economy and Taxation" in 1817?
David Ricardo
Who was David Ricardo?
English economist Supply and demand controls wages. When labor is plentiful wages are low, when labor is scarce wages are high. Wrote "Principles of Political Economy and Taxation" in 1817
Who wrote the Communist Manifesto in 1848?
Friedrich Engels and Karl Marx
What was the Combination Acts of 1799 and 1800?
It is illegal to join a union
What were the 2 laws that governed all of business according to Adam Smith?
Law of Supply and Demand Law of Competition
What did the Law of Competition say?
Manufacturers compete with one another to sell their products. Cut too much and you may go out of business cut too little and you wouldn't have enough to sell.
Who were the physiocrats?
Philosophers who searched for natural laws to explain economics; believed in a free market.
What did Thomas Malthus state?
Population increase is the greatest obstacle to human progress. People still multiply faster than disease and food production therefore misery and poverty are inevitable.
What did the Law of Supply and Demand say?
Prices and profit depended on both the amount available and demand for these goods. If one item was scarce then people would pay a high price for it.
What did socialists want to get rid of?
Profit and competition motivational system
Who was Adam Smith?
Scottish economist and philosopher Father of Capitalism Father of Modern Economics Wrote "Wealth of Nations" in 1776
What type of people advocated for socialism?
The average worker during The Industrial Revolution
Who followed Smith's ideas?
Thomas Malthus and David Ricardo
What did Marxist socialists feel was needed to overthrow capitalism?
Violence
Classless society=
pure communism