Geography 1100 Chapter Notes - Chapter 12: The Dismal Science, Proletarian Revolution, Invisible Hand
14 Dec 2017
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Economic geography: study of location distribution and spatial organization of economic activities across the earth; branch of geography concerned with the production and distribution of commodities; concerned with ideas about the location of economic systems. Adam smith (1723-1790) was a moral philosopher, wealth of nations: supply and demand closely linked. Demand as quantity increases, price decreases. Market equilibrium or invisible hand occurs where supply=demand: free enterprise capitalism, invisible hand of the market determines supply and demand. David ricardo (1772-1823: the dismal science", natural wage set by costs of subsistence what is the minimum you would accept to be paid (cost of subsistence). If paid less than this, you don"t have enough to live: theory of comparative advantage. If a country could produce everything more efficiently than another country, it would reap gains from specializing in what it was best at producing and trading with other nations: iron law of wages. Wages were determined by scarcity and the costs of subsistence.
