Wealth and Population

Adam Smith primarily focuses the relationship individuals have with one another in a capitalist society, which he describes within An Inquiry into the Nature and Causes of the Wealth of Nations.  Adam Smith begins his inquiry with a look into the division of labor among a population.  Smith determines that the individuals are most productive when they do what they are best at, through their own discovery of his/her own talents and abilities.  With his pin-maker scenario, Smith’s provides an easy to understand example for his ideal working conditions.  In which, Smith says that each step of pin-making is to be completed by a number of different individuals who specialize on one specific part of the process.  Smith views this division of labor to be vastly superior in contrast to an individual doing all the steps in creating a pin.  He believes it this division of labor will increase the amount of work and goods an individual can do, as well as cutting down on the length of time is takes to create a product. Additionally, he states that machinery can be put to more efficient use.Smith continues his inquiry, calling the possibility of maintaining subsistence for humankind.  He thinks that earth is simply incapable of keeping up with the forever increasing human population.

Smith’s sees the division of labor as a vital step into creating a healthy and productive economy.  The specialization of work in each individual allows for a large quantity of a specific piece of a product to be traded and sold to create a more completed product.  This product can then be traded for other products that individuals may require, thus promoting a large scale economy that spreads across nations and continents.

2 thoughts on “Wealth and Population

  1. Division of labor is certainly a major step in the evolution of a prosperous economy and a core component of the industrial revolution. Division of labor allows for more products to be manufactured in a shorter time than individual labor. From here trade expands at an exponential pace. Transportation of goods becomes more efficient through the use of steam ships and railroads, and global trade networks start to emerge.

  2. I think your post makes a nice contrasting point between Malthus and Smith. You stated that “Smith’s sees the division of labor as a vital step into creating a healthy and productive economy,” which may ultimately be true in this scenario- however, I believe that Malthus would say that in the overall picture the extensive production could be unhealthy and counter- productive for the existence of humanity. The rapid growth of production not only moves through our limited resources more quickly, but, in addition, the more products that are able to be made may end up providing a more comfortable lifestyle that allows people to increase their living standards and thus the amount of children they can support.

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