The Vision of Capitalism: Adam Smith vs Karl Marx | Free Essay Example

The Vision of Capitalism: Adam Smith vs Karl Marx

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Comparing Smith’s vision of the impact of the capitalist economy to that of Marx, it can be claimed that the former offers a more positive evaluation of the relevant outcomes. Hence, he points out that the main consequence of the capitalist economy is the division of labor that signifies the improvement in the productive powers. Smith notes that the division of labor can be better observed through the example of large manufactures rather than that of “trifling” manufactures that are supposed to serve a narrow circle of consumers.

He provides an example of a pin-making factory, where the labor is divided in accordance to different types of operations: drawing out the wire, straightening and cutting it, whitening the pins, etc. (Smith 1). Such a division allows an employee to get skilled in the assigned type of operation in a relatively short period. As a result, a manufactory is capable of producing thousands of pins a day, whereas a single worker would not be capable of producing even a dozen of pins in case he or she had to work separately and perform all types of operations.

Marx, in his turn, offers a more pessimistic vision of the capitalistic impact. First and foremost, he regards the division of labor as “the separation of use-value from exchange-value” (Marx, ch.6). Broadly speaking he regards the capitalist impact as the establishment of the monopoly of the powerful states and the exploitation of the working poor. From this perspective, the main difference in the two theories resides in the fact, that Smith applies the capitalistic impact to the developed countries only, whereas Marx attempts to examine it in the global context. Thus, for instance, Smith points out that the division of labor is more natural to be found in developed countries with strong economies and industries. In the meantime, he fails to evaluate it applying to the developing states.

Another critical difference that should be pointed out is the vision of the capitalistic impact on the agriculture. Thus, Marx insists on the expropriation phenomenon, noticing that it resides in taking away “from the labourer the possession of his means of production; a process that transforms, on the one hand, the social means of subsistence and of production into capital, on the other, the immediate producers into wage-labourers” (Marx 26).

Otherwise stated, Marx emphasizes the negative side of the capitalist market regarding it in terms of morality and justice. Smith gives a more neutral esteem of the impact that capitalism has on agriculture. The only point that he focuses on, in this framework, is that the division of labor is not as distinct in the agriculture as it is manufacture. Otherwise stated, it is easier to divide such operations as spinning and weaving than to separate the work of a grazier from that of a corn-farmer. As a result, the division of labor in agriculture is less productive or successful in terms of pace as the one in manufacture.

Smith supports this argument referring to the example of rich countries, the superiority of which is mainly based on the manufacturing progress, whereas their agricultural breakaway can be rather insignificant. In addition, he points out the competitive advantage of those countries that have a beneficial geographic position from the maritime perspective. Thus, he provides the comparison between the land and maritime transportations, pointing out the dominant cost-effectiveness of the latter. Therefore, it can be assumed that Smith initially focuses on the benefits of capitalism in the framework of particular countries. Thus, he does not target to prove its advantage in a global context.

The Division of Labor and Its Outcomes

As a result, the two philosophers offer opposite evaluations of the capitalistic impact on the working force. Hence, Smith believes that the relevant impact is entirely positive. Hence, he distinguishes the three advantages: the elevation of the workforces’ dexterity, time saving, and the implementation of advanced machinery. First and foremost, the division of labor implies that a particular employee performs one and the same operation becoming highly skillful at it in a short time.

Secondly, according to Smith, the time is saved due to the fact that there is no need for an employee to switch from one operation to another. This switch is especially time-consuming as it implies changing the tools and the location. Speaking about the invention of new machinery, Smith focuses on the fact that it has become possible mainly to the division of labor itself.

Thus, a worker that is totally focused on performing one and the same operation is more likely to come up with an idea of appropriate machinery or instrument rather than that who observes the working process in general (Smith 3). At this point, it should be noted that Marx also regards the implementation of the new machinery as a positive change. In the meantime, he believes that it implies a gradual reduction of the need for the human labor. Applying this assumption to the modern reality, it might be noted that his concerns were rather grounded – the development of the technologies implies the reduction of the workplaces creating the unemployment, the potential scope of which can hardly be estimated.

Smith assumes that the division of labor is the result of the humans’ propensity to exchange things. Otherwise stated, it is not an entirely economic phenomenon. On the contrary, the division of labor is purely natural – a person that is good at doing something prefers to focus on this activity, produce sufficient output and exchange the results of his work for the essential items. From this standpoint, Marx also considers it to be a natural process.

In the meantime, he evaluates the outcomes of the capitalistic impact negatively. Marx’s main point resides in the fact that as soon as an employee gets engaged in this bargain, capitalists will do their best to separate the worker from the property with the help of which the labor can be realized. In other words, they will do everything to make the employee dependent.

The Value of the Capitalistic Impact

Smith puts a particular emphasis on the fact that the capitalistic impact is of significant social value. Hence, assuming that such a division existed in the animal environment, it would be of little importance, whereas “the most dissimilar geniuses are of use to one another” (Smith 2). Smith, likewise, notes that the division of labor refers to the field of philosophy as well. Thus, a particular specialist becomes more competent in the relevant specialty, improving, in such a manner, the quality of science, in general. Marx believes that the capitalistic impact is beneficial for an exclusive social stratum, whereas the interests of the multitude are neglected.

One of the pivot points of Smith’s theory resides in the assumption that the extent of the labor division is determined by the exchanging power of the market. In other words, in order to encourage a man to get entirely involved in a particular market segment, it is essential that the market is big enough to offer a variety of exchanging options. Therefore, some employments can exist only in the context of large cities. Marx, in his turn, assumes that the balance of the exchanging power is impossible in the capitalistic world. Hence, the powerful minority will always have an incomparable advantage over the majority.

Critical Evaluation

It would be irrational to claim that the theory of one philosopher is more sensible than that of another. Hence, they both provide substantial grounding to explain their positions. At his point, it might be suggested that the main difference in these theories resides in the fact that Smith and Marx use different approaches to analyzing the phenomenon of capitalism. Hence, Smith mainly considers it in terms of the benefits it brings to the market development. Indeed, from this perspective, the capitalistic impact might be regarded as positive – it naturally leads to the division of labor, increasing its productivity considerably.

On the other hand, Marx tries to analyze this impact from the standpoint of its value for the employees. As a result, his core argument implies that they will inevitably remain poor as the powerful minority would never allow their accessing the commonwealth. Thence, from the moral perspective, Marx’s theory is more justified. Meanwhile, his speculations about the desired market conditions seem to be excessively idealistic. As a consequence, in terms of the market development, Smith’s position seems to be more practical, and the examples he provides appear to be more applicable to the modern reality.

Works Cited

Marx, Karl. Capital, London: Penguin UK, 2003. Print.

Smith, Adam. The Wealth of Nations, New York, New York: Random House Publishing Group, 2000. Print.