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Adam Smith

In an in-depth research paper on Adam Smith should begin by discussing his work The Wealth of Nations and other economic and capitalism issues.

"The label 'classical economics' is sometimes employed to refer quite simply to an era in the history of economic thought from approximately 1750 to 1870, in which a group of predominantly British economists used Adam Smith's The Wealth of Nations as a springboard for analyzing the production, distribution and exchange of goods and services in a capitalist economy." Ricardo, Malthus, and Mill were other leading economists in this era. Karl Marx is sometimes regarded as belonging to this group as well because he treated the same subjects as the others. But Marx sharply criticized capitalism, whereas the others mostly described it or analyzed it.

Wealth of Nations

Adam Smith

In "Wealth of Nations," Adam Smith introduced such terms as laissez-faire and the "invisible hand" of competition. Smith and the other classical economists are sometimes looked at as liberal economists because of the significance they placed on freedom in an economy. Businesses were free to produce what goods they wanted, to pursue the markets they wanted, and to innovate as they wanted. Individuals were free to make choices about what goods they wanted to buy. The relationship between these two major parts of the economy led to what goods were produced, the prices for them, and their distribution.

The economic ideas of the classical liberal economists are the basis for the free-market economy of most democratic, Western nations today. Businesses continually aim to produce goods or offer services to satisfy the needs and interests of consumers. In this free-market economy, advertising and marketing have come to play a central role in attempting to persuade consumers to exercise their freedom by purchasing certain goods. Government regulation of business is mainly concerned with insuring that the "invisible hand" is allowed to keep operating in the economy; by preventing monopolies from controlling certain markets, for instance. Leaders of corporations and other businesses in democratic countries take as articles of faith the principles of laissez-faire and the invisible hand treated extensively by Smith and the other classical economists.

The Theory of Moral Sentiments

The classical liberal economists saw economics as inter-related to politics and to society in general. In 1959, Smith published a book titled “The Theory of Moral Sentiments.” The economic writings of Smith and the other classical liberals reflected the values and ideals of democratic societies. Just as the democratic value of freedom played a central role in the politics of these societies and the lives of their members, it also played a central role in their economies.

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