Essay on Comparing Adam Smith and Karl Marx - 565 Words

Comparing Adam Smith and Karl Marx Smith and Marx agree upon the importance of capitalism as unleashing productive powers. Capitalism is born out of the division of labour... that is, it is made possible by dividing jobs up into simple tasks as a way of increasing efficiency. By increasing efficiency, then everyone can produce more than they personally need. The extra produced can go towards the accumulation of capital, (machines, more land, more tools, etc) which will allow for even more increased efficiency and production. Both thought that this increased production was great. But Marx said that capitalism was only one stage... that every country must go through capitalism, to get that increased production, but that capitalism is†¦show more content†¦Marx points out that the means of production are owned by only a small group of the population and most other people do not. These people who dont own the means of production (land, machinery, factories, tools, etc..) are called the proletariat and cannot sell their produce, only their labour-power... that is, they can sell hours of their time to other people. So the profits of their labour always go to those who hire them, and they are left with only a bare minimum wage. Smith and Marx both agree that capitalism requires ever expanding markets. Smith believes this is so because you cannot divide jobs down too much unless you have a large market. For example, city doctors, with their large population (market) can specialize while a country doctor must be a generalist. Unless the market continues to grow, jobs cannot be divided down further and large machines cannot be justified, thus production cannot continue to become more efficient. Marx, on the other hand, believes that you must have expanding markets because as you produce more you have more to sell (duh) and if you have more to sell you either have to have more people to sell it to or lower your prices in order to convince the same number of people to buy more. And the goal of course is to keep prices high. Smith says that the money that goes to paying wages comes from profits. ThereShow MoreRelatedAdam Smith Division Of Labour Summary1636 Words   |  7 PagesAdam Smith’s arguments on economic growth are heavily based on the concept of division of labour. The idea of division of labour relates to distinct specialization of the said labour force by breaking down one job into smaller components. Whereby one worker becomes an expert of their field, which is an isolated part of the production process. 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