Key Points Of Adam Smith David Ricardo Economics Essay

Key Points Of Adam Smith David Ricardo Economics Essay The classical writers of the eighteen and nineteen century when offering definitions of their science expressed themselves about the nature of the economic in two distinct ways. They could define the subject known as political economy. Or having defined the political economy as the science of wealth, they could proceed to set forth the nature of that wealth with which it was maintained that economics is concerned. (Israel M. Kirzner, The Economic Point of View, p 13). The earliest classical economist adopted the description of the economic side of affairs in terms of wealth, but developments narrowed down the concept of wealth to the idea of material wealth of mankind. The attitude toward the utility of economic inquiries in elevation of wealth became an object of scientific study. Investigations that aims finding the means of enriching people and the sovereign; discovering laws of governing and to make the nation wealthy. From the beginning alternative suggestions were made by the e conomists themselves about what should and what should not be included under the heading of wealth. Adam Smith in An Inquiry into the Nature and Causes of the Wealth of Nations, 1776, explains that the free market, while appearing chaotic and unrestrained, is actually guided to produce the right amount and variety of goods by a so-called invisible hand. He argued that self-interested competition in the free market would tend to benefit society as a whole by keeping prices low, while still building in an incentive for a wide variety of goods and services. An often-quoted passage from The Wealth of Nations is: It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own self-interest. We address ourselves, not to their humanity but to their self-love, and never talk to them of our own necessities but of their advantages.(Adam Smith, p.  18). Smith believed that economic development was best fostered in an environment of free competition. Smith saw no role for government in economic life but believed that the government should enforce contracts and grant patents and copyrights to encourage inventions and new ideas. He also thought that the government should provide public works, such as roads and bridges that, he assumed, would not be worthwhile for individuals to provide. Interestingly, though, he wanted the users of such public works to pay in proportion to their use. Value theory was important in classical theory. Smith wrote that the real price of one thing is the labor and difficulty of acquiring it as influenced by its scarcity. Smith also believed that the main cause of prosperity was increasing division of labor. It would affect a great increase in productivity, one example he used was the making of pins. One worker could probably make only twenty pins per day. However, if ten people divided up the eighteen steps required making a pin, they could make a combined amount of 48,000 pins in one day (Adam Smith, ch. 1). Smith claimed that an individual would invest a resource-for example, land or labor-so as to earn the highest possible return on it. Consequently, all uses of the resource must yield an equal rate of return (adjusted for the relative riskiness of each enterprise), otherwise reallocation would result. Smith used this insight on equality of returns to explain why wage rates differed. Wage rates would be higher, he argued, for trades that were more difficult to learn, because people would not be willing to learn them if they were not compensated by a higher wage. Similarly, wage rates would also be higher for those who engaged in dirty or unsafe occupations, such as coal mining and butchering. In short, differences in work were compensated by differences in pay. David Ricardo another classical economist wrote his famous work Principles of Political Economy and Taxation, (1817). Ricardo continued to work on value theory (ch. 1). He explains the labor theory of value that the relative price of two goods is determined by the ratio of the quantities of labor required in their production. He demonstrates that prices do not correspond to this value; he retained the theory, however as an approximation. His labor theory of value, however, required several assumptions: 1- both sectors have the same wage rate and the same profit rate; 2- the capital employed in production is made up of wages only; 3- the period of production has the same length for both goods. Ricardo himself realized that the second and third assumptions were quite unrealistic and hence admitted two exceptions to his labor theory of value: 1- production periods may differ; 2- the two production processes may employ instruments and equipment as capital and not just wages, and in very different proportions. In his book, Ricardos concept of rent is laid out. Due to variation in scarcity of land, some land pays a higher monopoly value due to its scarcity than other land. Ricardo labels Rent as the portion of individual benefit, that accrues to scarce, resources such as land or gold or houses that is over and above any socially beneficial exchange (ch. 2). If all land were equally situated, however scarce, one could determine that all market exchange of the produce thereof was free and equal and that the exact value of the trade was conveyed simultaneously to both parties and to society. Ricardo extrapolates the problem of monopolistic rent to other situations/resources that are fundamentally scarce: land or gold. Like Adam Smith, Ricardo was also an opponent in the field of a nations trade protectionism policy. In this book Ricardo introduces the theory of comparative advantage (ch. 28). According to this theory, even if a country could produce everything more efficiently than another country, it would reap gains from specializing in what it was best at producing and trading with other nations. The benefits of comparative advantage are both distributional and related to improved real income. Ricardo believed that wages should be left to free completion. . Another idea developed by Ricardo is Ricardian EquivalenceArtComComputers2010-09-04T09:20:00 http://en.wikipedia.org/wiki/Ricardian_equivalence#Introduction, is an economic theory that suggests consumers internalise the governments budget constraints and thus the timing of any tax change does not affect their change in spending. Consequently, Ricardian equivalence suggests that it does not matter whether a government finances its spending with debt or a tax increase, the effect on total level of demand in an economy being the same. Ricardo believed that in the long run, prices reflect the cost of production. The price of an object is determined by the sum of the costs of the resources that went into making it, and referred to this long run price as a Natural price. The natural price of labor was the cost of its production that cost of maintaining the laborer. If wages correspond to the natural price of labor, then wages would be at subsistence level. In his Theory of Profit, Ricardo stated that as real wages  increase, real profits decrease because the revenue from the sale of manufactured goods is split between profits and wages. He assumed in his Essay on ProfitsArtComComputers2010-09-03T16:28:00 http://socserv.mcmaster.ca/~econ/ugcm/3ll3/ricardo/profits.txt, 1815 that profits depend on high or low wages, wages on the price of necessaries, and the price of necessaries chiefly on the price of food. We will treat the economic definitions of another classical writer John Stuart Mill in his writing Essays on Some Unsettled Questions on Political Economy, 1844 as below. -If a country produces both commodities with greater facilities or both with greater difficulty in exactly the same degree, then there will be no motive for exchange. On the other side if they have advantage in producing some commodities, then through commerce the nations can benefit both if each one will specialize in producing those commodities. So a country, by devoting all inputs in the production of goods which their advantage is greatest and give for exchange to the foreign country, would obtain a greater return from labor and capital. But in what proportion the two countries would share the advantage of trade? The problem is concerning about of proportion of goods in exchange, thus exchangeable value or price, regulated by the demand and supply to respective importing and exporting countries. The costs of carriage, tariffs, and taxes are deductive to gain advantage. So two countries would have equal shares of benefit of trade if cost of transportation and other barriers would not exist, otherwise the gross gain is divided in unequal ratio. So a country through the legislative policy can affect the benefits from foreign commerce. As conclusion we may say that a country gains most from the foreign commerce as much as are the foreign needs for its products (Essay I: On the Laws of Interchange Commercial Between Nations and Gain of Commerce Among of Commercial World). A great and rapid consumption leading to an extensive demand, fast circulation and big spending of money was conceived to be the great conditions of prosperity. But consumption is of two kinds: reproductive and unproductive and the first augments to the national wealth while the second weaken it. What is consumed for unproductive is gone for present enjoyment, but what is consumed for reproductive consumption leaves commodities of equal value, commonly with addition of a profit (Essay II: Of the Influence of Consumption on Production). -The phrases productive labor and productive consumption has been used by writers of political economy considering all the labor which serves for useful purposes and consumption which is not waste- in a limited sense productive of wealth. When it is uncertain to which of the two classes (productive and unproductive) an object belongs then should be distinguished characteristics and usage of it. All workmen that work in producing or giving value to things and functionaries positions who have invested to their skills are included in productive labor. The settled classification definitions were used for determining their consequences in economy. A country is enriched in proportion to the amount of the productive labor and consumption and impoverished in proportion of unproductive labor and capital (Essay III: On the Words Productive and Unproductive). -Profit is the surplus which remains to the capitalists after replacing his capital in a gain purpose process. The rate of profit depends on the ratio between the price and proportion of labor, materials, tools and the produce of them; upon the proportionate share of the produce of industry. David RicardoArtComComputers2010-08-11T16:32:00 On the Principles of Political Economy and Taxation, 1817 said that profits depend upon wages: it increases when wages fall and decreases when wages rise. When he says rise of wages it is meant an increase in the cost of production of wages or an increase in the number of hours. So as we can see it is strictly true, that the rate of profits varies inversely with the cost of wages. Rate of profit can increase if: there is an increase of population beyond the capital; improvements in labor efficiency and new entrance successive technologies. The producer, who borrows capital to employ in his business, will pay for the use of it (the interest). There are variations in the market-rate of interest from day to day establishing the actual rate from the movement of demand and supply. The rate of interest has the increase tendency if there is a big demand, low supply, low security individual loan or industry and specific situations. The difference between the profit which can be made by the u se of capital and the interest which will be paid for it is characterized as wages of superintendence (for the risk and labor for carrying business). Interest and wages of superintendence are in the same inverse relation as wages and profits are (Essay IV: On the Words Profit and Interest). -Adam SmithArtComComputers2010-08-11T17:39:00 Inquiry into the Nature and Causes of the Wealth of Nations. gives a definition that Political Economy is a science which teaches or gives the means and laws of making a nation rich. It has included individual decisions connected with the ideas and feelings in man- forming part of a union or aggregations. John S. MillArtComComputers2010-08-11T17:53:00 Essays on Some Unsettled questions of Political Economy. gives another more complete definition of Political Economy: -The science which treats of the production and distribution of wealth so far as they depend upon the laws of human nature, or -The science relating to the moral or psychological laws of the production and distribution of wealth. Under the influence of this desire it shows operations of: accumulating wealth, employing that wealth, producing other wealth under the influence of competition, governed by laws, sanctioning by mutual agreements, establishing laws etc. The science proceeds to investigate the laws which govern several operations on acquisition of wealth (Essay V: On the Definition of the Political Economy and on the Method of Investigation Proper to it).

Robert Keith Millers Discrimination is a Virtue, Elizabeth Cady Stantons Declaration of Sentiments and Resolutions :: Eva Hoffmans Wanderers by Choice

Robert Keith Miller's Discrimination is a Virtue, Elizabeth Cady Stanton's Declaration of Sentiments and Resolutions, and Eva Hoffman's Wanderers by Choice Robert Keith Miller wrote Discrimination is a Virtue to clarify the definition of discrimination and how it is suppose to be used. The correct definition of discrimination is the ability to tell differences. He is saying that Americans use this term in more of a negative form, when they should be defining their actions as prejudice. He uses several examples to show this difference, which also grabs the reader’s attention. He explains that when you discriminate, you should be able to tell the difference between things and know what each needs. In other words, he is trying to say we should be as open-minded as possible, â€Å"but not so open-minded that our brains fall out.† However, Americans use the word discriminate by making others appear lower than themselves, and thinking less of them because they are lower. This should be recognized as prejudice. This essay makes discrimination very clear and shows how it should be used in American society. Declaration of Sentiments and Resolutions Elizabeth Cady Stanton wrote Declaration of Sentiments and Resolutions in order to convince the men her time that women should be equal and have the right to vote. She uses the Declaration of Independence to attract readers which makes it much easier for her to explain her purpose. She is trying to explain that, â€Å"We hold these truths to be self-evident: that all men and women are created equal; that they are endowed by their Creator with certain inalienable rights; that among these are life, liberty, and the pursuit of happiness; that to secure these rights governments are instituted, depriving their just powers from the consent of the governed.† Her purpose is clear; she takes the time to show how wrongly men of this time treated women and what should be done to resolve that. She explains that women should have the right to vote and have other responsibilities in government. She shows other examples from the Declaration of Independence and resolutions on how to make man and woman equal. She is trying to show how important it is to create a balance between genders and how each can learn from each other.

Management Information System at Dell

Management information system involves the information system and the organization. MIS begins where computer science ends. Computer scientists deserve accolades for developing and delivering even more advanced forms of information technology: hardware technology; software technology; and network technology. Yet because no technology implements itself, there is more to MIS than just information technology. MIS has dimensions. The four interrelated dimensions of MIS are as follows: First, MIS involves not just information technology, but also its instantiation; second, MIS involves, as reactive and inextricable elements, both an information system and its organizational context; third, MIS involves information technology as a form of intellectual technology; and fourth, MIS involves the activities of a profession or corporate function which are integral to the essence of what MIS is (Currie & Galliers, 1999). Dell Computer Corporation: Company Background Dell Computer Corporation is a major manufacturer of personal computers, computer peripherals, and software. Among the leading producers of computers in the world, Dell sells its products directly to customers through the Internet and mail-order catalogs rather than through retail outlets. The company is based in Round Rock, Texas. At Dell Computers, customers are brought into the product planning and manufacturing processes, with all employees encouraged having contact with customers. Through effective collaboration across boundaries, ideas can be shared about product designs and value propositions. The result is faster and more customer-focused product and service innovation. To produce the capacity for this, considerable attention must be placed on organizational structures, processes, skills and culture. Such elements may need a radical overhaul in established companies (Dennis & Harris, 2002). Dell was founded in 1984 by Michael Dell. In 1983, during his freshman year at the University of Texas, he bought excess nventory of RAM chips and disk drives for IBM personal computers from local dealers. He resold the components through newspaper advertisements at prices far below retail cost. By 1984, his sales totaled about $80,000 a month. In April 1984, Dell dropped out of school to launch his company (Ford, Honeycutt, & Simintiras, 2003). The new company soon began manufacturing its own IBM-compatible computers under the name PCs Limited. Because Dell sold computers directly to users through advertisements in magazines and catalogs, the company could price its machines lower than those sold through retail stores. Sales reached nearly $6 million during the company’s first year, climbing to $34 million the following year. By 1987, Dell was the leading mail-order computer company in the United States. In that year, it created a sales force to target large corporations and began adding international offices to capture the direct-mail market outside the United States (Ford, Honeycutt, & Simintiras, 2003). While the company continued to grow rapidly; Dell experienced a series of setbacks that hurt profits. In 1990, the company began selling computers through retail stores, an effort it abandoned in 1994. In 1991, Dell launched a line of notebook computers, but quality problems and inadequate production planning forced the company to stop selling for a year. In 1994, Dell launched a new line of notebook computers and expanded efforts to increase overseas sales. Dell also began focusing on the market for servers, which used the computers to run local area networks. By the late 1990s, Dell was firmly in place as the world’s number one direct seller of computers. More than 50 percent of the company’s computer sales transactions took place via its website, which generated worldwide sales in excess of $40 million a day (Ford, Honeycutt, & Simintiras, 2003). Information Processing Tools Information processing or Data processing is the analysis and organization of data. It is used extensively in business, engineering, and science and an increasing extent in nearly all areas in which computers are used. Businesses use data processing for such tasks as payroll preparation, accounting, record keeping, inventory control, sales analysis, and the processing of bank and credit card account statements. Engineers and scientists use data processing for a wide variety of applications, including the processing of seismic data for oil and mineral exploration, the analysis of new product designs, the processing of satellite imagery, and the analysis of data from scientific experiments (Thierauf, 1978). Data processing is used extensively in business, engineering, and science and to an increasing extent in nearly all areas in which computers are used. Data processing is divided into two kinds of processing: database processing and transaction processing. A database is a collection of common records that can be searched, accessed, and modified, such as bank account records, school transcripts, and income tax data. In database processing, a computerized database is used as the central source of reference data for the computations. Transaction processing refers to interaction between two computers in which one computer initiates a transaction and another computer provides the first with the data or computation required for that function. Most modern data processing uses one or more databases at one or more central sites (Thierauf, 1978). Transaction processing is used to access and update the databases when users need to immediately view or add information; other data processing programs are used at regular intervals to provide summary reports of activity and database status. Examples of systems that involve all of these functions are automated teller machines, credit sales terminals, and airline reservation systems (Thierauf, 1978). The information processing tools that Dell uses include computers, the internet, maps, spreadsheets, models, and databases. For the operational level of Dell, the most appropriate tool for information processing is maps. Through the said information processing tool, decisions on how to operate the organization can be initialized and made. Maps can be used to determine which country/place information will be acquired from, it can also assist in determining the demographic level of people and information will be gathered. Maps can be in the form of charts that can also provide necessary information. The information gathered in turn can assist in helping to decide how an organization will be operated. For the tactical level of Dell, the most appropriate tool for information processing is databases. Through the said information processing tool, the records that can assist in finding out the strength and weakness of the company can be used to determine the tactic that will be used by the organization. For the strategic level of Dell, the most appropriate information processing tool is the internet or World Wide Web. Through the internet, trends and strategies by other companies can be known. After analyzing the trends and strategies used by other companies, an appropriate strategy can be formulated to use by the organization. Inventory control systems Individual businesses need, first and foremost, an efficient inventory control system. This implies the minimum amount of inventory that will provide the consumers with what they need whenever and wherever they need it. Effectiveness of the inventory system means basically having an inventory mix that is most likely successful in satisfying consumer needs (Samli & Sirgy, 1995). The inventory control systems used by Dell is up to date and reliable to prevent problems to arise. The inventory system of Dell makes sure that anything the consumer need will be available to them at any given time. It is also what the company uses to know if certain products are still available or misuse of the inventory system may cost problems to the company. Conclusion Management information system involves the information system and the organization. Dell benefits a lot from the management information system. The system helps the company create strategies that will help the company conquer any problems and threats from competitors. The system also assists the company in processing the needed information. Management Information Systems also helps a company to create or update its inventory control system. Recommendations Since the MIS of a company is a vital part of its operations and its survival in the modern world, it must be well updated and it must compete well with MIS’s competitors. The MIS of a company should be created from high standards so that it can be of stiff competition against its counterparts. The MIS system should help the company to achieve its goals and assist the company in reaching its potential

Ap World History Compare and Contrast Essay Egypt vs....

Unit 2 Anonymous Civilization. The word â€Å"civilization† comes from the Latin term for â€Å"city.† The first civilizations were the river-valley civilizations, so-called because they all developed alongside major rivers to secure an adequate water supply for agricultural production. 2 of the greatest river-valley civilizations were Mesopotamia and Egypt. All though they both supported having a patriarchal leader or king, Egypt had a strong, centralized government, whereas Mesopotamia was decentralized, and built based on small city-states operating independently. In both societies, the patriarchal leaders were influenced by religion tremendously. For example, in Egypt, all the citizens believed that not only did their pharoah have†¦show more content†¦This can be seen in Egyptian artwork, which is described as cheerful, colorful, and lively. Because there was only one leader in Egypt, there were governors in many key areas of the empire. However, a consistent problem seen in Egypt is the pawning of rulers, in which the priests always played a huge role in society and controlled the pharaoh. When looking at other civilizations most notably Caliphate, the caliphs were pawned by military and religious leaders, which ultimately lead to the downfall of their empire. Mesopotamia was a decentralized civilization, and resulted with many rulers leading the many city-states within the empire. Due to the many wars occurring within, kings were originally war leaders, and the function of defense and war, including leadership of a trained army, re mained vital. Due to being many rulers within the empire, there were many internal conflicts, let alone the outside ones, which resulted in Mesopotamia further advanced its empire by developing ideas for a bureaucracy and laws, by using Hammurabi’s code. It laid down the procedure for law courts and regulated property rights and duties of family members, setting harsh punishments for crimes. This focus on standardizing a legal system was one of the features of early civilization. Also, the political structure there was enforced by none other than the Sumerians, which can be seen in many similar ideas and traits passed on today’s modernShow MoreRelatedArt History7818 Words   |  32 Pagescivilization back any further #61607; All started around same time #61607; Alls started independently #61607; Mesopotamia Ââ€" present day Iraq • Earliest Cradle • Around 4,000BC #61607; Egypt • Around 3,000BC #61607; Southern India • Around 3,000BC #61607; China • Around 2,800BC • Composed of two separated and distinct cradles of civilization • Chapter 2 Ââ€" Egyptian Art o Egypt Ââ€" Latin named coined by Romans o Around 2,800-2,200BC o Originally divided into tow separated kingdoms #61607;