Adam Smith and Karl Marx Difference essay
Adam Smith and Karl Marx Difference essay They were both known for their distinct theoretical contributions. Adam Smith proposed that there should be a free market where the producers are free to produce as much as they want and charge buyers the prices that they want. He thought that this would result in the most efficient and desirable economic outcome for consumers and producers. This meant that the consumers would only pay as much or less than they would value the benefit from the good, and the producer would only sell for as much as or higher than they would have spent on making the product. The market would always be equilibrium. There would only be a limited role for the government in the economic system. Karl Marx disagreed and thought that workers would have an advantage because they are already rich and there would be a disadvantage to the poor. The rich would only get richer and the poor would only get poorer. He came out with a theory called the labor theory of value. The claims that the value of a good or service is directly connected to the amount of labor required for its production. Marx thought that the two classes in society, the bourgeoisie and the proletariat, will remain stuck in their respective classes because of the very nature of capitalism. The wealthy bourgeoisie owns the factories and also dominates the media, universities, government, bureaucracy, and hence. Their position on the social status is unchangeable. The poor proletariat are only able to work hard. Marx thought that to fix this problem; the poor would have to revolt and create a new social order where there would be no distinction between segments of society. Adam Smith thought that capitalism was the most ideal economic system. Adam also opposed the idea of revolution to restore justice for the masses because he valued order and stability over relief and oppression. Marx thought that capitalism would lead to instability and injustice in a society. Marx