Homework Question on History of Economic Thought and Globalization
YouTube Link :https://www.youtube.com/watch?v=e3w98cTDwWQ
From Economics Evolving – A History of Economic Thought and the notes on the board in class.
- In your own words, briefly explain Adam Smith’s concept known as division of labor? What benefits does it provide?
- In your own words, briefly explain Adam Smith’s thoughts on the following:
- relationship between rich and poor
- The proper role of government
- Howmercantilism affects the domestic poor.
- In the Reason TV interview of Russ Roberts on Adam Smith and the Theory of Moral Sentiments, in your own words:
- Briefly explain the concept of beneficence, and how it relates to free markets?
- Which is more compatible with free markets, a government solution to local problems or voluntary collective action and why?
- Define confirmation bias and the “cherry-picking” of data. How are they related, feel free to use an example.
Homework Answer on History of Economic Thought and Globalization
Based on the arguments of Adam Smith, division of labor relates to the production of greater output from the cooperation of numerous workers in handling small tasks in the work place. Smith noted that division of labor has expanded more in the manufacturing sector than in the agricultural sector. Some of the benefits of division of labor include increases in output and people’s wealth.
Based on the thoughts of Adam Smith, the relationship between the rich and poor exists in the fact that the rich succeed at the expense of the poor in the society. Thus, the rich enjoy luxuries at the expense of the poor people.
Adam Smith argued that the government has a significant role in promoting the government functions. Smith argued that the role of government includes the protection of the citizens from violence and invasion by other societies. Most importantly, the government had a role to establish and maintain strong public institutions. This summarizes the thoughts of Adam Smith on the role of government.
According to Adam Smith, the mercantile system would affect the performance of the domestic economies. Since, the mercantile system encouraged the hoarding of commodities, which would make the domestic poor people unable to purchase the products. The mercantile system creates a shortage of products and this makes it difficult for the domestic poor to access the items.