Trade Policies For National Enrichment

In a nut shell, Price claimed the Industrial Revolution created the division of labor (2004). The Division of Labor is perfectly encapsulated by the Henry Ford model of the assembly line (Price, 2004). Each worker on the assembly line only needs to know how to attach or inspect the operation of their assigned part on to the object as a whole, and not how to assemble the entire product. This allows for any unskilled person to be taught how to attach their doodad onto the doohickey without knowing what the doohickey does or operates. This is capitalism in the basic form of the ideal. Capitalism desires economic efficiency, thus the assembly line is a perfect example of the rise of unskilled factory workers and the decline of skilled craftsmen during the industrial revolution and the rise of capitalism.

The first book, “Of the causes of improvement…,” talks about the division of labor and the wage of labors. According to Smith, there are three advantage of division of labor. First, it increases the employees’ dexterity; second it decreases the amount of time it consumes to make the product; and third reason is that because of the many inventions of machine, each employee can perform the work of many. Smith thought division of labor is important because labors can be more efficient if they are specialized in specific work.

By entrepreneurs embracing newer inventions, an increased demand for workforce was created in a growing, and soon to be booming, field of manufacturing. In Britain between the years 1700-1850 the skills of laborers proved to be much higher than the time following due to most workers completing mundane repetitious activities for several hours at a time, rather than partaking in the entirety of the process. Because of this, a lack of dependence on human capita in regards to manufacturing developments is prevalent in the general population, making nearly every worker at the time expendable. This correlates directly to the famous statement made by Adam Ferguson, “many mechanical acts require no capacity…ignorance is the mother of industry as well as superstition…manufacturers, accordingly, prosper most where the mind is least consulted.” 22 To avoid such mundane work, a man of industrial times could make higher wages as an engineer of mechanic to work on the mechanic being used by the lower skilled workers.

He claims that "The greatest improvement in the productive powers of labour, and the great part of the skill, dexterity, and judgment with which it is any where directed, or applied, see to have been the effects of the division of labour" Smith gives the example of a small pin factory with ten workings employed in it. He states that if the ten workers make pins by themselves, they would only product twenty pins or less per person each day. If the workers divide up the task and each specialize in one or two simple procedure, the factory can produce the equivalent of 4800 pins per person everyday. Further more, since it takes less labor to produce more, commodities will become more affordable. "The wages of labour would have augmented with every improvement in its productive powers, to which the division of labour gives occasion. All things would gradually have become cheaper. They would have been produced by a smaller quantity of labour." With the increase in productivity and decrease in price from the division of labor, society will accumulate enough wealth and welfare for everyone.

Major rise in tariffs have caused a major outrage between the South and the West. Before the tariff rise in 1716 there was no tariff rise because Congress had claimed it to be unconstitutional. Southern citizens had to purchase most of their goods from the North, but mostly from Europe. Many of the citizens of the South had claimed and understood that Congress had claimed tariffs to be unconstitutional, and were shocked to see the rise in tariffs. Many of the items in the South grew tremendously in price, which caused outrage to many citizens in the South, they. The West also saw that since the government had been receiving tariffs, they

He begins by making a basic statement, saying that he's going to talk about what counts as the "wealth" of a country and how certain countries tend to have more wealth per person than others. Smith wanted to figure out how many modernized countries have fared differently when it comes to producing wealth. He says “The nation will be better or worse supplied with all the necessaries and conveniences for which it has occasion”. Saying that if the country has everything they need they will be successful. He says that everyone who is able to work, should be working. He starts stating that the greatest improvements in the productive power of labor lie in the division of labor. He gives reasons behind the increase in productivity, “The effects of the division of labour, in the general business of society, will be more easily understood, by considering in what manner it operates in some particular manufactures”. The division of labor creates specific meaning of particular trades or tasks. That makes the laborers more dedicated to their work. With the division of labor, time is being saved. While they are focusing on one task it will get done better. Rather than it having to be done over and over again until it is perfect. The time spent on one task leads to innovation in the ways it gets done and the tools that are being used. Since productivity is now being increased, there are more jobs becoming available. With the

     In mid-eighteenth-century England the industrial revolution was in full swing. However, workers lived near the level of physical subsistence, and their condition worsened in latter half of the eighteenth century. Monotony and repetition characterized factory work; the tyranny of the factory clock and the pace of the assembly line were beyond the control of all workers. The division of labor, praised by Adam Smith in The Wealth of Nations as the means to productivity growth and rising living standards, made work so routine that women and children could perform jobs just as easily as men. Business owners logically preferred such workers because they could be hired for less.

Adam Smith explained that the products that were produced through labor were the essential components to the nation’s prosperity. From Smith’s passage about pin making he made it very clear he was pro dividing up the labor among multiple workers. From Smith’s passage I believe he pointed four true gains of the division of labor. Listed in no particular order;, save time, produce more products, increase the number jobs, and increase the quality of products produced. Each component has it’s pros and cons, but from what Smith says, the pros outweigh the cons and division of labor should be implemented in all factories.

Trade-offs play a significant role in every economic agreement. It is impossible for each nation to produce a sufficient amount of each good necessary to maintain its population, making trade an integral part of societal function. In theory, specialization leads to

The country can maximize their wealth by putting the resources in the most competitive industries. Government created comparative advantage rather than free trade because now easier moves the production processes and the machines into countries that can produce more goods (Yeager & Tuereck, 1984). However, many countries now move to new trade theory suggests the ability firms to limit the number of competitors associated with economic scale (reduction of costs with a large scale of output) (Krugman, 1992). The comparative advantage occurs when two-way trade in identical products, it will useful where economic scale is important, but it will create problem with this model. As a result, government must intervene in international trade for protection to domestic firms (Krugman, 1990)

The value of Wealth of Nations did not lie on the presented ideas being original, but it rested on the brilliant way in which Smith organized and fitted the different ideas from different thinkers into one massive masterpiece – like a completed jigsaw puzzle, his work has been described as a comprehensive landscape of economics . His work and contribution to the world of economics made him the ‘Father of Economics’ and inspired many economists after him such as David Ricardo and Thomas Malthus.

Adam Smith, author of The Wealth of Nations, shows support for free trade and emphasises it as a trade policy which ought to be adopted. Krugman and Obstfeld back Smith's support by stating that the efficiency of trade is increased by free trade and accumulates the national income of countries. Free trade is a theory which suggests that each nation benefits in specialising in an economic activity from which it gains absolute advantage, enjoying absolute superiority over other nations in a specif economical activity (Peng). With free trade follows opportunity, replacing regulation and growth of economic activity. (Rugmann and Collinson).

We can see that through the division and specialization of labour that Adam Smith’s pin factory

”Free trade policies have created a level of competition in today's open market that engenders continual innovation and leads to better products, better-paying jobs, new markets, and increased savings and investment” (Denise Froning). Though Free trade plays a huge role in the economy today because of what and where it is used. Free trade allows for traders to trade across national boundaries and other countries without government interference. Meaning that traders have very few regulations that allow for them to do this without the government intervening. Free trade makes things for traders much easier and also allows for many more jobs in the US, such as exporting jobs, or jobs in the auto industry and plants. Though there are many

To comprehend the potential and actual effects of governmental intervention on the free flow of trade