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Running head: ADAM SMITH
Adam Smith
Name
Institution
Date
ADAM SMITH
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The classic logical expression of Adam smith concepts of labor is essentially described
on the perspective of causes and effects of division of labor. The prelude of division of labor has
an underlying basics which led to Adam Sith conclusion that the economic growth of the nation
is rooted on incremental division of labor. The concept involves breaking down labor force into
tiny components which leads to specialization. He defines that division of labor is not a mastery
of human wisdom rather, it is existent within the human nature.
In regards, Adam smith focused on assumption of maximization in human nature. the
human nature focuses on fair, deliberate, self-interest and creative. The assumption relies on the
perfect competition within the market. The first principles to the perfect competition are many
buyers and many sellers. Human being’s self-interest drives them to perform with an aim of
achieving their self-satisfaction. in the process they deliberately focus on an activity which can
meet their personal needs. The end product of self-interest leads to people performing in
differential activities which leads to division of labor. According to Adam Smith, division of
labor could lead to the higher productivity. The principle was developed from a perfect social
division of labor on lines of gender, age and family classes in a typical community where
division of labor is and order of the day. An example is when some is bow makers while some
are hunters.
In addition, human beings are not similar to the wild animals they face exhaustion on
activities. Creativity naturally drives human being to the point of devising ways of achieving
high productivity and accumulation of material wealth. the drive leads to human being
specialization focused at higher productivity on concentration on an area of ability.
According to Adam smith propensity of exchange and barter is not artificial rather it is
natural. the inherent properties of human nature are still on its developmental stage. the human
nature on market exchange existed with the inception of human race. the social co-production
has taken root and has increasingly developed into a monetary value. Adam smith considers a
similar scenario of a hunter and bow maker. The primitive society do not understand the
marketing concepts. the need to achieve a satisfying product is a human concern, a bow maker
requires meat to maintain the body working condition. Since they have substantial skills, they
enable another person to go hunting. Similarly, the hunter needs a bow to hunt and make a living.
Essentially, they will exchange the meat for a bow. The market and exchange is an innate human
nature established within the a social order where specialization dominates. every human being
has something they can do to facilitate another person’s work.
From the Adam Smith concept of the wealth of the nation, people developed from the
basic hunting to agricultural activities. In a number of centuries people shifted to manufacturing
and then foreign commerce thereafter. the natural order took a major role in shaping the
exchange into a wide scale. the human desire to develop convert, increase the investments,
increase their productivity and accumulate more resources still drives the overall market
exchange. the process started with meeting the necessities of life and increasingly demanding to
the process of self-actualization. Each individual triumph to achieve the appropriate and
progressing need based on the Maslow concept of human needs. Conclusively, human nature on
predisposition material comfort has played a role in division of labor and market exchange.