A Brief History of Economics Essay Example for Free

A Brief History of Economics EssayThrough his use of dialectic materialism, Marx not only changed the history of stinting thought, just now found great illumination for himself regarding the bonds of hu art object society. The supposition that seems relatively simple in todays complex frugal world was utterly subversive in the time of Marx volume develop their ideas some the world (and thereby, their ideas for how society should be organized and stratified) ground on the material aspects of their lives.It was an elegant extension of basic Marxist theory capitalism, according to Marx, is interested in offering naked materialism as a kind of booby prize to make up for the means of productionion being taken a federal agency from the people. If the people can no longer fashion for themselves and no longer work at perfecting their own craft as individuals, then, as Marx correctly deduced, people would require something to validate their work.This became the center of capita lism, as Marx understood it materialism exists as a kind of vindication for capitalism, and since materialism has permeated our culture to such an extreme degree, eventually social orders began to revolve around it. Hence, what capitalism serves as the cause of what Marx saw as nothing less than ongoing class warfargon. It is interesting to note that Marx imagined a violent revolution on the part of the proletariat was not simply a possible order of changing things, only when really served as the only method of changing things.This is because materialism was so enter into class structures (which, in turn, was so embedded in power structures), and the only way for society to functionally survive was for it to conk everywhereturned completely. It is also interesting to note the ongoing effect that Marx has had on philosophical thought materialism had previously been dislodged by Descartes and the famous declaration I think, therefore I am as far as most people who pondered th ese things could conclude, thought preceded matter.However, Marx not only brought materialism to the philosophic forefrontthe then-controversial idea that material preceded thoughtbut illustrated the notion that the abstractions of materialism had been concretized by capitalism into dish onenessst goods. 2 Marx and the Secret Source of Profit Perhaps the most enduring notion of Marxs is the alleged(prenominal) secret of the source of profit under a capitalistic societythough such is Marxs legacy of intellectual thought, a great m both people simply accept this notion as reality the source of profit is the surplus value that an employer gains from laborers.After all, the means of production have been taken from the people skilled artisan cobblers have been replaced by factory line workers churning out enclothe after shoe after shoe. The money saved by employing this assembly-line method of industrial production becomes unmingled profit for the employer. Interestingly, Marx tethere d this to his own theories on circulating capitalthat is, something that does not last, and is used up in the production of other goods and services, in direct opposition to fixed capital, which is traditionally held for over a grade by a business or institution.Marx astutely deduced that the distinction between these concepts is not only relative, but arbitrary the idea that capital held for 365 days is circulating and that capital held for 366 days is fixed is absurd. However, it allows the proletariat to fundamentally gloss over their own necessity to the entire institution of capitalism they are led to believe that society is held up by the fixed capital of major investors and their long-term investments.In reality, society is held aloft by the ongoing purchases of the common man (and woman) their disposable income is burned off to provide them a smell out that capitalism is worth itit turn, their disposable income is used to make the rich richer, as the cliche goes, all the w ay up the capitalist pyramid. In Marxs view, this is one of many ways that those in power previse the seemingly unavoidable class war that he advocates those with powerthe purchasing power of the common manare convinced they have none, and are bought off with trinkets.It is interesting to note that this echoes the master/slave morality inversion of Nietzsche. 3 Marginalists and the Economy In the evolution of economic theory, the impact of marginalism cannot be overstated. Once one had accepted the blunt realities of Marxspecifically, that society was organized based on the perceived value of itemsthe logical enquiry remained how does one quantify the value of an item?Marginalism illustrated the diminishing returns on the marginal utility of resold products, which dramatically impacted analysis of capitalist economy, the focus of economic analysis, and theories of value and distribution. Regarding the analysis of capitalist economy, marginalism helped solidify the supply and p ostulate notion of economics as that of mainstream economic thought, as opposed to the labor theory of value espoused by Karl Marx.To put it mildly, this has had ongoing economic personal effects for the last century and a half. The focus of economic analysis shifted accordingly, as marginalism interacted with price theory this allowed economics to project demand curves utilizing marginal rates of substitution as a means of determining not only when, but why a seller is free to relinquish a product for a particular price. Perhaps one of the most lasting effects of marginalism on economic thought has been its effect on theories of value and distribution.With the previous measures in place, economists (as well as common people) now had a more-or-less accurate measure of determining the value of any given product in any given social context. Of course, this also effects the ongoing distribution of certain(p) products to certain demographics in order to maximize profitability. Interest ingly, this is one of the chief criticisms of marginalism as well that it is a vague pseudoscience whose attentive is to maintain not only the economic status quo, but the appearance of the status quo.It is no surprise, then, that Marxists quell to grapple with marginalist theory they see it as a means of keeping the proletariat in check, and preventing any uprisings from them. 4 Thorstein Veblen Survival of the Fattest Thorstein Veblen, for better or worse, specialized in bringing the human element into economic theory. Specifically, he theorized that the institution of the leisure class was a parasite feeding upon America upon the backs of workers who are actually productive are a class who seek only profit and produce nothing but waste.He essentially created and popularized the notion of conspicuous outgo as the epitome of this theory that wealthy individuals put down large amounts of money on ostentatious goods whose sole benefit is to publicly display their wealth to the wo rld. Unfortunately, this has become an integral part of the economy although an engineer might weep at the man spending over a hundred thousand dollars for a car, the American economy would be crippled if conspicuous consumption vanished overnight.Hence, the parasite metaphor conspicuous consumption and naked profit helps the wealthy to bloat themselves on the backs of the unequal until the entire enterprise inescapably crumbles under its own weight. Veblen perceived quite clearly that human notions about the world are social constructs created by individuals, and as time went on, those notions would change, necessitating a change in economic thought as well. He makes frequent comparisons to evolution to further this end idle curiosity spurs debut, innovation spurs conflict between the old guard and the innovators, and an economic Darwinism is born.The advent of industry and technological revolutions merely grow his original point the parasitic relationship continued unabated, a s the innovations of the productive engineer class were inevitably utilized as means of conspicuous consumption and waste on the part of the leisure class. Planes are developed as a result of idle curiosity, for instance, but it is the leisure class that necessitates the invention of send-off class as a way of displaying their own status in the social hierarchy.