What is the main difference between Adam Smith's view of the economic system and Marx's view?
Answer:
Adam Smith argued that people, left to their own means and desires, would bring about the most efficent allocation of goods. This works by the invisible hand of the economy which makes rarer goods more expensive and most prevelent goods cheaper.
Marx says people are idiots, and the the gov't should distribute the goods.
The impications of Adam Smith is capitalism, the private ownership of goods and property
the implications of Marx's is communism and socialism, which is the public (gov't) ownership of goods.
You can see which one is better by looking at who won the cold war
USA!! USA!! USA!!
Consider this. If one government believes that the economy should be controlled not by the state, but by individuals, then that government thinks the same way as Adam Smith. If one government believes that the state should control the economy, then it is in accordance with Marx way of thinking. Smith believed that when people are free to act in the economy, its laws (the economy's) will lead to general prosperity. Marx thought that if individuals are free to act, then someone will abuse someone else eventually. America follows Smith's thought. Socialist states used to follow Marx's thought. In America almost everything is private; in socialist countries the state controlled the economy (production of goods, education, and health).
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