Adam Smith's View Of Capitalism

659 Words3 Pages
Q3. Adam Smith was a professor at the University of Glasgow, Scotland. Adam Smith defended the ideas of a free economy or a free market. He wrote about his ideas in his book The Wealth of Nations. In his book, he addressed three main claims that he believed backed up his thesis of capitalism. Capitalism is an economic system in which the production is privately owned and money is invested for the purpose of a profit. Adam Smith's main belief was that the government should have no control within a business.
Adam Smith was the founder of the capitalism theory. He strongly believed that the government should not interfere with the businesses. To back up his claims about the government, he wrote his own book setting forth his own ideas on the topic.
…show more content…
Adam Smith would argue that competition would force people to make better products. Honestly, I would agree with his claim on competition. I agree because, when you are faced with competition, you want to make yourself better than the other person. For example, if you had your on business and someone else decided to start up a business similar to yours, competition would begin quickly. The other new business would come as a threat, you would need to ensure that your current consumers stayed with your business. If you began to lose consumers to your competitor, your business would not last very long. With Adam Smith's law of competition, it would quite literally force business owners to make better products. Consumers were looking for the best product with the cheapest price. For example, your business sold a phenomenal product; however, your latest rival also sold the same satisfying product for a cheaper price. The consumer would learn more towards the business that sold the product for the lower price. In the end, as a business owner, you would want to sell the best quality of your product at the lowest price possible. The law of competition would ensure the consumer with a win-win situation, consider the quality and low price of the
Get Access