Similarities Between Adam Smith And Karl Marx

Even though his views of a communistic utopia are strongly opposed in America, we can use the problems he pointed out to improve capitalism. Marx thought people wanted to feel important through their work, and he feared capitalism would ruin this desire. In large firms and factories, the contribution of individuals would seem minute, leading to alienation (Wolff). Marx also concluded that capitalism made humans expendable. He believed people would be seen as another form of production that could easily be replaced when costs rise or new technology takes their place. This could be solved by a communist world where everyone feels valued. This "equal ness" would also prevent capitalists from gaining enormous profits, which came at the expense of the talent and hard work of the labor force. He also believed capitalism was unstable and was bound to have many crises throughout its reign due to an accumulation of an abundance of resources. One rather remarkable belief of Marx was how unemployment was good because it meant the labor force was so productive that people did not need to work. He thought unemployment should be looked at as freedom. For example, Marx opposed the female work opportunity movement by asking why women want to join in the agony that is work. Overall, Marx thought capitalism would teach us to be anxious, competitive, conformist, and politically complacent

Division of labour is also credited with the rise of trade between different areas, the rise of capitalism, and increasingly complex manufacturing and industrialization. For Karl Marx, the production portion of Capitalism signalled great trouble. He believed production in Capitalist society worked in a way that the rich factory owner benefited and the poor factory workers lost. In his manner of reasoning, the Capitalist system was inherently meant to benefit the rich and exploit the poor: “All the bourgeois economists are aware of is that production can be carried on better under the modern police than on the principle of might makes right. They forget only that this principle is also a legal relation, and that the right of the stronger prevails in their ‘constitutional republics’ as well, only in another form.”[ii] Marx’s view of society and the world lead him to believe that humans create change in their lives and in their environment through practical activity in the practical world.

Karl Marx and Adam Smith wrote in the same time period – during the industrial revolution, where the bourgeois had risen to power by oppressing and exploiting the proletariat. The term bourgeois refers to the people in the class of modern capitalists, owners of the means of social production and employers of wage labor. The proletarians are the people in the class of modern wage laborers who, having no means of production of their own, are reduced to selling their labor power in order to live. While Smith, in his Wealth of Nations, wrote in favor of capitalism, Marx, in his Communist Manifesto, was a harsh critic of the system and declared its inevitable destruction and consequent rise of the working class.

The simplistic perception of capitalist society varies greatly among Smith and Marx. Smith believed that capitalism is a mechanism designed to curb man's selfishness and put it to work for the general good of all (Baumol, 1976). Conversely, Marx believed that capitalism is based on neither good nor evil, but a product of historical circumstances or experience (Baumol, 1976). Marx also believed that the law of motion in capitalism frustrates, rather than facilitates, the individual ends (wealth). Marx believed that wealth divides capitalists by class, and that workers must develop in a universal class (Levine, 1998). Marx also disagreed with Smith in believing that production must cease to be a labor process if it

Adam Smith and Karl Marx both came from very different worlds, however they saw the world in similar ways. Both had thoughts derived from different views. Smith had a very capitalistic view on things, while Marx was socialist in many ways. They expressed their thoughts in ways that were surprisingly similar while other ideas were dissimilar. Ultimately socialism and capitalism can go hand in hand. One main idea that both works addressed was the productivity of work and the ability to accumulate property, stock and capital. They both wanted a wealthy nation but Marx believed that redistribution of wealth was the way to go. Smith believed in a free economic system that gave capitalists rights to accumulate their wealth.

In fact, he believed that the division of labor was conducive to the wealth of state and brings efficiency to the economic labor system. While Marx believed the division of labor to be the inhibitor of self-realization, Smith believed would be what produced efficiency and fostered a productive economy that produces more wealth. His example in his work The Wealth of Nations, of a pin factory, Smith clearly proves this fact of efficiency that division of labor produces. He writes of two workers working in this system and that if one worker makes a whole pin, it takes longer and only produces 200 pins in a day. Yet, when the production of one pin is divided into several parts, the workers are able to make 48,000 pins in a day (Smith WN: 45). Unlike, Marx and Engels, Smith believes that this work is allocated based on peoples’ in-born talents. While Marx believes that this sort of work strays away from man’s realization of his species being and that his work is something that is not natural to him, Smith believes the opposite and that the division of labor caters to peoples’ specific, natural

Marx’s issue with society was that people felt alienated and estranged, mostly from their work. Marx saw the entire capitalist economic system, though a necessary stage in human development, as unjust. He blamed capitalism for the alienation people felt, identifying their need to sell their labor and work in unfulfilling jobs as the root of their dissatisfaction. He took issue with the dehumanization capitalism causes, as people are seen as a commodity and their individuality is sacrificed for industry and the success of their

Under capitalism, if you purchase a business and pay people to work there, you are entitled to all of the profits earned. Marx views this as an immoral and an unsustainable socio-political model.

For example, it shapes the nature of religion, law, education, the state and so on. According to Marx, capitalism sows the seeds of its own destruction. For example, by polarising the classes, bringing the proletariat together in ever-increasing numbers, and driving down their wages, capitalism creates the conditions under which the working class can develop a consciousness (or awareness) of its own economic and political interests in opposition to those of its exploiters. As a result, the proletariat moves from merely being a class-in-itself (whose members share the same economic position) to becoming a class-foritself, whose members are class conscious – aware of the need to overthrow capitalism. The means of production would then be put in the hands of the state and run in the interests of everyone, not just of the bourgeoisie. A new type of society – socialism developing into communism – would be created, which would be without exploitation, without classes and without class conflict. Marx’s work has been subjected to a number of criticisms. First, Marx’s predictions have not come true. Far from society becoming polarised and the working class becoming poorer, almost everyone in western societies enjoys a far higher standard of living than ever before. The collapse of so-called ‘communist’ regimes like the former Soviet Union, and growing private ownership and capitalist growth in China, cast some doubt on the viability of the practical implementation

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

The economic theories of Adam Smith and Karl Marx have different systems, but both of them are significant to social progress. Capitalism is formed to set the economy free, and is carried out during the Industrial Revolution. Later, Marxism is formed as a result of the Industrial Revolution, trying to ensure the welfare of the working class. Although Karl Marx aims at bringing equality to society, ultimately Adam Smith is correct, because his theory of capitalism increases working efficiencies, promotes economic development, and inspires innovation.

The economic theories of Adam Smith and Karl Marx could be seen as the farthest points from each other on the economic map. Governments have never succeeded in forming an all capitalist economy nor an all communist economy. This is because while principles of both theories exist in the national or global marketplace it is impossible for either to fully succeed. Until the day when all humans share a common economic viewpoint it will be impossible to achieve either or the mens theories. With this in mind, a combination of both principles with a long term goal of a market economy would suit the shipwrecked citizens the best.

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.

There is deep substance and many common themes that arose throughout Marx’s career as a philosopher and political thinker. A common expressed notion throughout his and Fredrick Engels work consists of contempt for the industrial capitalist society that was growing around him during the industrial revolution. Capitalism according to Marx is a “social system with inherent exploitation and injustice”. (Pappenheim, p. 81) It is a social system, which intrinsically hinders all of its participants and specifically debilitates the working class. Though some within the capitalist system may benefit with greater monetary gain and general acquisition of wealth, the structure of the system is bound to alienate all its

The system of capitalism is partially based around the unpaid surplus labour of workers that allows for the generation of profit for the workers ' respective superiors. Marx argues that such a system rewards those who have some sort of domination over the workers, the actual producers of commodities. This results in terrible living