Two Essays Chief And Greed

Two Essays Chief And Greed-66
This would result in all work being done at the best quality and with the most efficiency.(Smith expanded this idea to trade between nations with nations each specializing in specific goods.

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The “Capitalism Based on Greed” fallacy says that greed and selfishness are inherent in capitalism.

The assertion that capitalism is based on greed and selfishness is one of the most common fallacies.

(Notice that Smith is not asking us to act according to our self-love.

He is saying that in our economic exchanges we should appeal to other peoples’ self-love as the basis for meeting our needs.

The kewy point is that specialization and trade, results in endless win-win transactions.

Endless win-win transactions are the basis of capitalism, not greed. The difference between what it cost the producer to create the good and what the buyer paid for the good is the profit.

As the monks prospered, markets began to form around monasteries.

Merchants moved close by and sought trade with the monks and other merchants. New methods of international business sprang up with the Knights Templar as they facilitated pilgrimages to and from the Holy Land.

Beginning in the 13th century the Medici family in Italy founded a banking system that encompassed all of Europe. Greater and greater precision was developed in monitoring and analyzing production and trade.

By the 18th century Adam Smith identified key elements that were contributing to the expansion of wealth in Europe.

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