The Evolution of Capitalism Essay Example | Topics and Well Written Essays - 1000 words

The Evolution of Capitalism - Essay ExampleMarx and Engels were in truth critical of capitalism and the methods proposed by Smith. For them capitalism creates course of instruction antagonisms and the only beginning is to overthrow capitalism. Carnegie like Marx acknowledges class divisions, but views inequality as inevitable and the solution lies in administration of riches. The aim of this paper is to search the evolution of capitalism and its impact on society through the works of Smith, Marx and Carnegie. Adam Smith is considered as the father of free market capitalism with the invisible hand controlling the market. Industrialization led to the pulverisation system which changed work patterns. Laborers now produced commodities for exchange in the market with prices determined by forces of demand and tag on instead of producing for own use (Sanders et al. 203). Due to lack of other means of obtaining subsistence food and maintaining their race, they offered their struggle to mill owners in exchange of wages thus commodifying labor. Division of labor became the norm in factories leading to labor productiveness since workers could produce more products than if acting alone (204). Some operations ar more heterogeneous than others requiring different skills and as such wages were paid according to level of complexity. Actors in this system are driven by self-importance-interest. In Adams words its not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest (204). By pursuing self-interest (profit) the capitalists render essential goods and revenue to the community without intending to do so. Though market mechanisms regulate the market, sometimes the employers combine to go down wages below the natural rate (207). Smith condemns such combinations as they hinder competition and resembling case applies to government interventions. Free trade is encouraged as a nation cannot be self sufficient it could be cheaper to import than manufacture locally (207). Marx agrees with Smith that division of labor leads to improved productivity thus new wealth acquisition and that competition brings market efficiency (214).However, those who produce wealth do not benefit as capitalists accumulate the surplus value. This to Marx is exploitation of labor and also results into two mismated classes the bourgeoisies (capitalists) and proletariat (working class) (216). The discussion during the early 19th century thus moved from discussing the rise of capitalism and center on the class struggles produced by capitalism. Free trade and competition advocated by Smith only deal out to encourage exploitation of workers by the capitalists. If the market is allowed to operate freely, capitalists employ and dismiss labor as they like and offer low wages since they have a reserve army of workers (217). Furthermore, labor has been replaced by machines. The solution offered by Marx and Engels to end class antagonisms is to overthrow capitalism and replace it with communism. This entails abolishing private property and move from individually according to his ability to each according to his needs (215). Carnegie agrees with Marx that capitalism produces classes as evidenced in America. impudently classes of the rich and poor emerged with the gap between them widening as rich accumulate more wealth (220). Since competition is healthy and the government ought not to intervene in the market, his main concern is how this wealth