Adam Smith Socialism

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Socialism

What is Socialism?

Socialism is a school of thought which denotes that means of production, distribution, and exchange should be managed by the community as a whole and not by individuals. This means that money would be managed by the whole community and distributed thus instead of it being individual money. Two socialist pioneers, Karl Marx and Freidrick Engles believed that there was a specific path of society towards communism (this was the end goal of society and it was a self sustaining society where all people were equal in pay and status and worked only for the good of community.) Socialism was part of this changing of society on the journey from completely oppressive dictatorial societies to communist societies. Socialism developed into a huge movement
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In 1766, Adam Smith, known as the ‘Father of Capitalism’, published An Inquiry into the Nature and Causes of the Wealth of Nations, which outlines how capitalism works. Smith gave it a social and philosophical background, which inspired and encouraged many other famous thinkers and philosophers. In his book The Wealth of Nations, he challenged mercantilism. The economy of mercantilism was controlled by the state, and the country would have a monopoly over all ports, ships, and crews. Smith’s book challenged the mercantilist concepts with his proposition of laissez-faire policies. ‘Laissez-faire’ is French for ‘Let them be’, and a laissez-faire economy would remove restrictions on trade. This would mean that the market itself, not the government or state, would run the economy. Smith believed this would encourage the expansion of trade, as he thought self-interest and the motive of profit was a strong incentive, allowing individuals to generate wealth and employment. This, in turn, would signal a significant boost in the nation’s economy. This thereby shows capitalist countries opposed the idea of

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