The Implications for Marx's Theory

The commodities are equated in honor (so many pairs of shoes are worth a table) and, therefore, gracious project of all kinds is equated at the same time--but in a hidden fashion. By employing the analogy of the pagan idol or fetish Marx slyly indicated how gentleman's gentleman labor is hidden and do by in the exchange of commodities just as the worshipper of a fetish ignores the fact that it was made or chosen by human efforts. This had very important implications for Marx's theory since the worker's labor, he held, became little valuable in itself the more commodities the worker produced.

2. Adam metalworker's notion of the "invisible hand" describes the self-regulating nature of markets. Smith believed that in its commercial phase a society functioned best if it allowed " correct liberty" for the economy, that is, freedom from any form of regulation. This was possible because human nature itself contained certain drives that would, if left unfettered, produce a raw(a) orderliness in society. Of course, if people merely act gibe to their passionate drives this appears to promise disruption rather than order. moreover, as Smith saw it, there is a natural and universal entrust of human beings to correct themselves, And "an augmentation of fortune is the means by which the greater part of men propose and wish to better their build" (Smith II.3). This drive to better one's lot produces competition and, incidentally, competition is the chemical mechanism that regulates the market.

each individual's desire to better her/himself is pitted against that of every other individual. Competition, Smith believed, restrains commodity prices to a "natural" aim and assures that goods and services testament be unendingly available at "natural" prices. In order to make it in competitive endeavors one must restrain prices to a level that has a direct relation to the costs of output signal. curt prices give, of course, mean that the labor involved allow not win subsistence while investment will not produce a worthwhile return and prices that are too high will mean that competitors' commodities will be preferred by consumers.

hence it is in the best interests of producers to maintain prices at a level that produces sufficient profit and ensures continuous sales. This natural competition will also regulate the market by inducing labor and capital to migrate from less utile to more profitable endeavors. Therefore the market will regulate itself in the contingency of, for mannikin, the existence of a glut of a particular commodity or service. Equally importantly, the possibility of greater profit will prompt labor and capital to seek to fill gaps in the meeting of demand by migrating to under-served portions of the market.

3. In Smith's conception stinting growth, necessary to the increase in a country's wealth, was based on increasing division of labor and labor specialization, the discovery of new-fashioned kinds of technology, and an increase in the amount of raw materials available to producers. accommodative production increased productivity (as he showed in his example of the production of pins) as did the division of labor into separate trades--bootmakers, carpenters, wheelwrights. This was an progress over the less efficient older system in which each person produced many of these goods for his/her own use or, at most for the use of a very few others. But Smith wrote before the dominance of the capitalist mode of production that came with th
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