Adam Smith vs.Alexander Hamilton
The debate between those advocating for a free market and those advocating for government intervention in the economy has been an ongoing debate for centuries. During the time period of the founding of the United States of America, key economic and political thinkers engaged in a debate over the proper role of government in the economy.
Submit a 1000 word (maximum) essay that addresses the following questions:
- What does Adam Smith think about government intervention in the economy? What are two reasons that Smith offers, suggesting that tariffs are not desirable? Is there any scenario in which Smith might support government intervention in the economy?
- What does Hamilton conclude about government interference in the economy? What does Hamilton propose will be the result if tariffs are imposed? How does Hamilton justify the use of tariffs?
- Considering the views of both Hamilton and Smith, who makes a more convincing argument with regard to the desirability of government intervention in the economy? Why?
Helpful references :
Government and Business:
American Political Economy in Comparative Perspective
Chapter 1, “Origins of Government and Business” (pp. 3–26)
Chapter 2, “Creating Government-Business Relations” (pp. 27–45)
Lehne, R. (2013).
Answer preview
Adam Smith think of the government intervention
Adam Smith decimated the mercantilist view on the cause of wealth. Previous, the western economies viewed that accumulation the golds, and other precious metals were the source of wealth for countries. In his view, Adam Smith emphasized the capacity of a country to create more goods and services. Adam perceived that trade and human productivity were the ultimate roots of economic progress. Ideally, productivity was the function of the specialization of labor. Adam asserted that it was significant for factories to reorganize labor in a manner that the workers specialized in one area which ultimately yields efficiency. To accumulate more wealth, a country was supposed to produce more goods and services and export with other countries with less absolute advantage…
(1050 words)