Classical Economists vs Utopian Socialists essays

Classical Economists vs Utopian Socialists essays There are many ways that to govern a country. Obviously, officials run most countries, but what kind of system do they govern by? Some of the most important systems used today are capitalism, socialism, and communism. As a coherent economic theory, classical economics start with Smith, continues with the British Economists Thomas Robert Malthus and David Ricardo. Although differences of opinion were numerous among the classical economists in the time span between Smiths Wealth of Nations and Ricardos Principles of Political Economy and Taxation, they all mainly agreed on major principles. All believed in private property, free markets, and, in Smiths words, The individual pursuit of private gain to increase the public good. They shared Smiths strong suspicion of government and his enthusiastic confidence in the power of self-interest represented by his famous invisible hand, which reconciled public benefit with personal quest of private gain. From Ricardo, classicists derived the notion of diminishing returns, which held that as more labor and capital were applied to land yields after a certain and not very advanced stage in the progress of agriculture steadily diminished. The central thesis of The Wealth of Nations is that capital is best employed for the production and distribution of wealth under conditions of governmental noninterference, or laissez-faire, and free trade. In Smiths view, the production and exchange of goods can be stimulated, and a consequent rise in the general standard of living attained, only through the efficient operations of private industrial and commercial entrepreneurs acting with a minimum of regulation and control by the governments. To explain this concept of government maintaining laissez-faire attitude toward the commercial endeavors, Smith proclaimed the principle of the invisible hand: Every individual in pursuing his or her o...