The Economic Theories of Adam Smith

Prepare and submit a term paper on Economic Theories of Adam Smith. Your paper should be a minimum of 1250 words in length. Economic Theories of Adam SmithThis report will discuss different economic theories by Adam Smith, a Scottish philosopher. Adam Smith is the founder of a free-market capitalism. He is also the father of modern classical economics and a proponent of laissez faire economic policies. His arguments against mercantilism made him the father of modern economics. The Scottish philosopher spent many years teaching and publishing some of his lectures in the “Theory of Moral Sentiments” in 1759. The material gained ground and laid the foundation for the publication of “The Wealth of Nations” in 1776 which cemented Smith’s place in history. However, many critics note that in his time Smith did not ‘invent’ the ideas he wrote about. He only popularized the ideas that became known as classical economy. Using his work other economists solidified the theories of classical economy which became dominant during the time of great depression or the global economic crisis. The report will also compare the current economic system with Smith’s and conclude whether he would agree with current policies of today if he was alive. Production Theory From the economists’ point of view, production simply means the creation of goods and services which consumers will buy. Companies are the units of production, and they convert input into output through a transformation process (Kurz & Salvadori, 1995). The theory of production then consists of how a company chooses and combines various inputs to produce an output at a given level in the most efficient manner. The assumption is that decision making is done with the view of maximizing profits. Production is all about creation of wealth which in turn adds to the society’s welfare. Resources are limited and must be efficiently utilized to create the maximum possible welfare. There are different inputs or resources of the society used in the production process. These inputs or resources are the factors of production. Adam Smith identified three factors of production which are land, labor and capital. In the economics the definition of land refers to all the natural resources which are used in production. The land notion includes farming and building land, forests, rivers, lakes, and mineral deposits. Therefore, land does not mean a piece of earth. Labor attributes to both mental and physical efforts used in the production of goods and services. Labor is distinct in that it is the services of labor that are bought and sold. Labor is also unique because it is the reason why economic activity takes place. The supply of labor is measured by the number of hours of work which is offered at a given wage rate over a given period of time (Kurz & Salvadori, 1995). Capital is a man-made input and can be classified as working or circulating capital referring to stocks of raw materials, partly finished goods, and finished goods held by producers. Alternatively, it can be classified as fixed capital which consists of all the equipment used in production. The aspect of specialization is important in the production process. It refers to the concentration of activity in those lines of production where the company or an individual has some natural or acquired advantage. Adam Smith drew attention to the importance of the labor division in his book “The Wealth of Nations”.

Order NOW For A 10% Discount!
Pages (550 words)
Approximate price: -

Why Choose Us

Top Quality and Well-Researched Papers

We always make sure that writers follow all your instructions precisely. You can choose your academic level: high school, college/university or professional, and we will assign a writer who has a respective degree.

Professional and Experienced Academic Writers

We have a team of professional writers with experience in academic and business writing. Many are native speakers and able to perform any task for which you need help.

Free Unlimited Revisions

If you think we missed something, send your order for a free revision. You have 10 days to submit the order for review after you have received the final document. You can do this yourself after logging into your personal account or by contacting our support.

Prompt Delivery and 100% Money-Back-Guarantee

All papers are always delivered on time. In case we need more time to master your paper, we may contact you regarding the deadline extension. In case you cannot provide us with more time, a 100% refund is guaranteed.

Original & Confidential

We use several writing tools checks to ensure that all documents you receive are free from plagiarism. Our editors carefully review all quotations in the text. We also promise maximum confidentiality in all of our services.

Customer Support 24/7

Our support agents are available 24 hours a day 7 days a week and committed to providing you with the best customer experience. Get in touch whenever you need any assistance.

Try it now!

Calculate the price of your order

We'll send you the first draft for approval by at
Total price:

How it works?

Follow these simple steps to get your paper done

Place your order

Fill in the order form and provide all details of your assignment.

Proceed with the payment

Choose the payment system that suits you most.

Receive the final file

Once your paper is ready, we will email it to you.

Our Services

No need to work on your paper at night. Sleep tight, we will cover your back. We offer all kinds of writing services.


Essay Writing Services

No matter what kind of academic paper you need and how urgent you need it, you are welcome to choose your academic level and the type of your paper at an affordable price. We take care of all your paper needs and give a 24/7 customer care support system.


Admission and Business Papers

An admission essay is an essay or other written statement by a candidate, often a potential student enrolling in a college, university, or graduate school. You can be rest assurred that through our service we will write the best admission essay for you.


Editing and Proofreading

Our academic writers and editors make the necessary changes to your paper so that it is polished. We also format your document by correctly quoting the sources and creating reference lists in the formats APA, Harvard, MLA, Chicago / Turabian.


Revision Support

If you think your paper could be improved, you can request a review. In this case, your paper will be checked by the writer or assigned to an editor. You can use this option as many times as you see fit. This is free because we want you to be completely satisfied with the service offered.