ECON 001A Chapter Notes - Chapter 4: Stone Age, Barter, Absolute Advantage
19 May 2020
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Chapter 4: societies and economic systems (pg. Market economy: implies a self-regulating system of markets; it is an economy directed exclusively by market price. Previous to our time, no economy has ever been controlled by markets, even though markets go back to the stone age. Adam smith: mans propensity barter, truck, and exchange prophetic of the. Industrial revolution and influenced polanyi as well as other 19th century economists notion of a market economy. However, adam smith"s analysis of primitive man"s psychology was wrong. Division of labor is not dependent on the existence of markets but on a variety of factors including differences in sex, geography, genetics, etc. This shows how inaccurate these economists" critiques are. No economist knows of (or studied) an economy prior to our own, when there are many in which markets have played an insignificant role. Apocryphal (adam smith"s quote) of doubted authenticity, but widely known/renounced of famous .
