“Wealth of Nations”
Who is the author?
Adam Smith, the Father of modern economics wrote the “Wealth of Nations”.
What is the topic of the reading?
The topic of the excerpt from the “Wealth of Nations” is the free market system of economy in which the Government does not have total control over the economy as it would in a communistic society such as Vietnam. However in a free market, the government still has certain control over the economy allowing it to place limits on powers such as monopolies.
When did the author write this piece?
Adam Smith, the author wrote the series of books titled the “Wealth of Nations” in the year of 1776. This series was critical to the time period of the Industrial
Revolution which occurred from the late 18 th to the late 19 th centuries.
Where is the author from?
Adam Smith was born at Kirkcaldy, Fife in Scotland in the year of 1723 and remained in Scotland as a social philosopher and economist until his death in 1790 in
Why is this reading relevant to business?
Smith’s “Wealth of Nations” is relevant to business in the fact that the business conducted within the U.S. relies greatly on the concept of the free market. The economy in the United States today is in fact based on Smith’s free market system.
In the “Wealth of Nations” Smith brings up concepts of trading through both importing and exporting goods in the free market system as well as the concept of
Laissez-Faire , and the invisible hand which represents the self-regulating role of the marketplace in economy.
How do you, the student react to this reading?
I found this excerpt from the “Wealth of Nations” by Adam Smith to be fascinating due to the fact that a majority of the concepts that came from Smith changed the way that people would view the economy forever. Smith did not only place his concepts of a free market system forward, but he also went into detail in describing how these concepts worked. I find it interesting how in present time much of the countries of the world have adopted Smith’s concepts and utilized the free-market system of economy.
What is “The Invisible Hand”?
According to Adam Smith, “The Invisible Hand” is a phenomenon that naturally guides the free-market system and capitalism through competition for scarce resources. Smith then goes on to claim that there is little to even no need for government intervention in the economy due to the fact that “The Invisible
Hand” is the most essential source for guiding the economy.
Who influenced the U.S. founding fathers?
The U.S. founding fathers were heavily influenced by individuals like Thomas
Hobbes. Hobbes is credited with establishing America’s First Principles, and the concept of limiting governmental control. Hobbes also contributed to the Social
Compact which stated that governments are instituted by the people and derive their just powers from the consent of the governed.
Book Questions Page 129
What is the Invisible Hand?
In the “Wealth of Nations”, “The Invisible Hand” is described as a phenomenon that naturally guides the free-market system and capitalism through competition for scarce resources. Smith then goes on to claim that there is little to even no need for government intervention in the economy due to the fact that “The Invisible Hand” is the most essential source for guiding the economy
What is the proper role for government in directing the economy of a country and its trade? Why?
In the “Wealth of Nations” Smith suggests that the government should have little to no impact or control in how the economy functions. Smith held the belief that “The Invisible Hand” would guide the economy, therefore leaving no need for the government to regulate it. This is emphasized through the concept of “Laissez-Faire” emphasizing that the government should leave the economy alone.
Prohibition-Act of prohibiting, a law or decree that forbids certain activity.
Endeavor- To exert oneself to do or affect something; making an effort or striving to do something.
Dissuade-To deter by advice or persuasion, persuade not to do something.
Emporium-A large retail store, especially one selling a great number of articles.
Absurdity-The state or quality of being absurd. Utterly or obviously senseless.