SOCB42H3 Lecture Notes - Factor Price, Barter, Asteroid Family
Document Summary
Only refer to wealth of nations for this assignment. Both these things lead to national wealth commercial. Smith quote on commercial society: in society, every person lives by change becomes to be a commercial society. What are the rules that make trading work: money and markets. Why does money exist: limits of barter, having barter is very restrictive and doesn"t allow markets to grow. Ex: i have a cow you have a pig, i don"t want the cow and you don"t want the pig. Side note: smith believes that the amount of labor that goes into producing something is what determines how. Natural prices are determined: market price: however much you actually sell something for. That often is different from the natural price. Smith states, people tend to adjust their behavior to bring those two in line with the other. This is where he uses the metaphor for of gravitational force.
