Business Philosophy.edited.edited

docx

School

University of Nairobi *

*We aren’t endorsed by this school

Course

LPM305

Subject

Economics

Date

Nov 24, 2024

Type

docx

Pages

Uploaded by BarristerGiraffePerson595

1 Business Philosophy Student’s Name Instructor’s Name Course Title Date

2 Introduction The history of economic philosophy reveals the origins of contemporary economics. It started with the development of industrialization and rural communities. The writings of philosophers indicate different schools of thought that explain the emergence and adoption of various notions. The chosen philosophical principles may define the current economy. Economic expansion has resulted in widespread education and technical improvement across the world's countries. Nevertheless, several schools of thought have precipitated a crisis in economic development. A debate on the free market economy is engaging since it gives the perspectives of several academics. Currently, the Nigerian State cannot offer efficient economic management and commodities, appropriate infrastructure for the well-being of its population, and adequate security. Economic Challenges in Nigeria From ancient researchers, including Thomas Malthus and Adam Smith, to contemporary scholars, such as Karl Marx, it is thought that demand and supply impact market pricing for products and services. In this perspective, the theorists played an imperative role in showing that a free market economy implies that if economic growth and progress are to be accomplished, the government should stay as far away from economic activity as feasible. The Nigerian economic crisis may be ascribed to the relationship between market demand and supply (Serpa & Ferreira, 2019). Despite the nation's abundant energy resources, the population is too dependent on self- generated electrical power. National Electric Power Authority (NEPA), which controls the supply side of the country's power market, is unable to provide adequate, dependable, and accessible electricity standards (Serpa & Ferreira, 2019). Poor performance in energy delivery has resulted in significant losses, contributing to the nation's economic woes. Price volatility in the global oil

3 business and weak macroeconomic structure, particularly the country's inability to grow its economy, are other significant contributions to its economic difficulties. Diverse economic and non-economic objectives pursued without adequate appreciation of tradeoffs have also contributed to the crisis (Serpa & Ferreira, 2019). This is evident in their international pricing methods. The exceptional macroeconomic phenomena in Nigeria are attributable to institutional and administrative failings that have resulted in production inefficiency and higher operating expenses. Marxism was developed by Karl Marx and had three separate components: philosophy, economics, and ethics. It was heavily influenced by the notion that those who hold the production methods gain the power to control the other classes and bring the State to its knees with their immense riches (Monette, 2019). These individuals are known as capitalists. As this study is primarily concerned with the economic element of Marxism, we will examine the fundamental concepts of Marxist economic theory. Marxism's economic perspective is the theory of value. These concepts include the theory of Surplus Value, the Labour theory of value, and the Accumulation of Capital (Monette, 2019). Marx never used the phrase "labor theory of value" in his publications; instead, he used the term "law of value." He argued against attributing a supernatural force to labor by noting that it had been proposed by renowned economists such as David Ricardo and Adam Smith. This theory seeks to define the precise meaning of "economic value." Marx distinguished between a commodity's 'use value' and its 'exchange value' in his study of a commodity. Marx, who believed that capitalists were profit-hungry, predicted that the demand for labor would increase, causing wages to rise. The increase in salaries over the subsistence level would reduce capitalists' profits prompting them to seek methods to reduce their labor expenses

Your preview ends here

Eager to read complete document? Join bartleby learn and gain access to the full version

Access to all documents
Unlimited textbook solutions
24/7 expert homework help

4 (Bear, 2020). To save money, many firms would begin using innovative labor-saving devices. Since machines would replace laborers, unemployment would increase, decreasing demand for manufactured products (Bear, 2020). As more employees grew unskilled and redundant, their bargaining strength for higher salaries diminished, resulting in a two-tiered society comprised of the "proletariat" and the "capitalists." Marx thought industrial workers would eventually rise and topple the capitalist system (Bear, 2020). Then, the workers would control the production factors. He foresaw that oligopolies and trading cycles would occur. Marx died in London in 1883. Karl Marx was right when he said that any state based on Capitalism would eventually collapse since the bourgeoisie cared only about exploiting workers for their surplus value. The wealthy continue to get wealthy, while the poor continue to decline. Massive stagnation of the economy and corruption among public officials are the two primary economic challenges plaguing Nigeria. Due to poverty, inflation, unemployment, and job losses, Nigeria are now in a recession. Marx might have been pointing to symptoms, not causes, of Nigeria's present situation. Citizens are preoccupied with their lives to see that Capitalism is the root of all this ill (Monette, 2019). During the colonial period, Capitalism was introduced to Nigeria. The colonial State governed rural producers via a culture to which they had little exposure and were unfamiliar due to the capitalist system imposed by colonization. To recognize the worth of their labor, rural farmers were thus dependent on the trade of goods in markets whose conditions they could not control. The colonial overlords advanced their mission by setting up fundamental institutions from which they could control their puppets. Three such edifices are the Church, the School, and the State. Infrastructure, including trains, roads, ships, internal waterways, ports, and airstrips, were all upgraded or built from scratch to accommodate the burgeoning colonial export trade.

5 Adam Smith, credited with founding "The Classical School" of economics, was a supply- side economist. According to Taylor (2018), Smith ascribed economic growth to rising output and commerce, with increasing demand as a byproduct and result. He championed the unseen hand of free entrepreneurship, demonstrating that people may help society by following their self-interest ( Aspromourgos, 2008) . In other words, if individuals intend to sell, they must create what others want at a price they are willing to pay (Taylor, 2018). He also espoused the laissez- faire philosophy, which holds that the government should only intervene in the market to obtain funds for infrastructure maintenance, legal system maintenance, and national defence. In his 1776 work, "An investigation into the nature and factors responsible for the prosperity of countries," Smith discussed the division of labor and the operation of markets, in addition to the preceding two principles (Taylor, 2018). Division of labor was not a novel concept, but Smith saw it as a crucial means of creating wealth. Smiths also believed in the Labour Theory of Worth, which states that the value of a thing is equivalent to the cost of the labor that went into producing it. George (2019) establishes that Smith felt a divide existed between productive and nonproductive labor. As they do not manufacture things for resale or generate income for reinvestment, teachers, engineers, and others with comparable occupations are deemed nonproductive. According to Aspromourgos (2008) , Smith also established the concepts of a product's "value in use" and "value in exchange." Twenty years after Smith's death, the subsequent generation of authors and economists adopted his works and ideas, establishing him as the pioneer of economic science (George, 2019). It has been argued that there had been considerable economic talk before Adam Smith, but with him, it grew to the level of economic discussion.

6 In subsequent years, Thomas Robert Malthus further expanded and polished the classical thinking school. Wang (2021) offers that both were native Englishmen and adherents of Smith's beliefs. The classic "Essay on the Foundations of Population as it Impacts Future Social Improvements" by Thomas Malthus was published in 1798 (Wang, 2021). The Industrial Revolution occurred during this period, leading to increased rural-to-urban migration. Malthus anticipated the development of many slums, with food, water, and waste becoming severe issues. His article outlined how population growth would follow a geometric trend while food supply growth would follow an arithmetic development (Wang, 2021). He determined that there should be a limit on population expansion. These checks comprised positive checks involving death by war and illness and preventive checks requiring fewer children to be born (Donoghue, 2021). He supported the notion of the wages fund (Milin et al., 2022). This theory argued that paying employees over the subsistence level would increase the number of workers' families, reducing the worker to the subsistence level of life. Aspromourgos (2008) supports that t his concept ruled for over a century. It was widespread with companies because it enabled them to pay lower salaries while yet feeling justified. He is associated with the "Paradox of Thrift" idea, which states that when individuals save, their consumption falls, resulting in overproduction (Donoghue, 2021). To combat this issue, he suggested that the government invest in nonproductive sectors, such as the construction of parks, to increase the movement of money and boost demand. Malthusian notions are still applicable in some sectors of the LCDs today. Ricardo, like Malthus, supported the wages theory and developed the term "economic rent." This rent was conceived as "any payment to a production component over its supply price." In the Napoleonic wars, for instance, Europe relied on Britain for its food supplies. This resulted in a substantial increase in food production profits due to a substantial increase in

Your preview ends here

Eager to read complete document? Join bartleby learn and gain access to the full version

Access to all documents
Unlimited textbook solutions
24/7 expert homework help

7 demand (Wang, 2021). In order to generate as much food as probable, landowners are increasingly cultivating less productive, previously uncultivated land. This raised the demand for land, increasing the rent, particularly for more productive areas (Wang, 2021). He believed that agriculture was vital to the success of the industry. The writings of "Sutter" influenced Ricardo to formulate the law of economies of scale (Wang, 2021). This was the foundation of international commerce. He believed in open international commerce because it maximizes resource use, boosting revenue. Understanding Political Economy In his study, Smith hypothesized that labor division is essential to economic progress. This implies that economic progress would be realized if employees specialized in specific fields. Smith remarked that labor is a market-facing resource (Donoghue, 2020). This implies that some types of work will be removed over time. However, Smith said economic forces were self-regulating, meaning that the government would not intervene. Marx's thesis was founded on the results of Smith (Monette, 2019). Marx discovered that Capitalism was accountable for substantial economic expansion in most of Europe. As a result of the establishment of Capitalism in Europe, workers endured hardship because their services were no longer required. Marx and Malthus disagreed over the significance of Capitalism in population growth (Monette, 2019). Malthus had previously attributed population growth to biological forces, but Marx attributed population growth to Capitalism. It is fascinating to hear that Capitalism is accountable for population growth. States would want population growth to gain a considerable labor force, propelling the economy ahead (Donoghue, 2021). Marx refers to this kind of population growth as the labor reserve army. Before Marx studied economics, Ricardo proposed that labor's cost determines any item's price. In contrast to Ricardo's theory, Marx argued that in a capitalist

8 society, the product's value is greater than the worker's (Boner, 2018). This is a surprising discovery that may be difficult to forget. Almost simultaneously, products and services are created and consumed in contemporary life in Nigeria. This is a result of globalization, which has rendered geographical distance irrelevant to enterprises. Products manufactured in the United States and Europe might reach Africa and Asia within a day (Boner, 2018). In the current world, technological breakthroughs have reshaped commercial processes. People's use of sophisticated tools, such as social media, has significantly altered marketing efforts. Globally, businesses use social platforms such as Instagram and Twitter to reach their target audiences (Boner, 2018). Unexpected tensions in the African nations influence individuals in the United States. The globe is now termed a global village because a mistake in one region impacts enterprises everywhere. When the cost of petroleum increases on one continent, the cost of products and services increases on other continents. Recent Nigerian upheavals demonstrate that nations are no longer self-sufficient but instead interdependent. The economic crisis in the United States and Europe impacted enterprises worldwide. All of these advancements in the global system may be traced to technological improvements. Due to globalization, the Nigerian people understand that their government needs to take more steps to promote social and economic prosperity. The poor have already become more impoverished, while the wealthy benefit from public resources. This may be contrasted to the living conditions in Europe and the United States, where the government assures every citizen has access to social resources. Numerous economic areas have benefited from technological advances, especially the development of computers. Every area of the economy relies on technology for growth. The advancement of modern transport networks, such as air travel, has

9 increased the global economy in the transportation sector (Boner, 2018). Because of technological advancements, people are still determining the future. Conclusion As a result of societal transformations, economic thinking has evolved from one theory to another. Due to differing economic concepts, an economic growth crisis has emerged. The beginning of economic expansion coincided with the beginning of industrialization. Mercantilism, marginalism, classical thinking, institutionalism, and Marxism are a few of the phases of economic thought history. The notions highlighted how a state might amass riches to achieve economic expansion. Today, economic development in Nigeria is essential because money creation is a power source. Education, agriculture, and technology have received considerable focus since they provide the potential for economic expansion. Moreover, choices are made to achieve expansion.

Your preview ends here

Eager to read complete document? Join bartleby learn and gain access to the full version

Access to all documents
Unlimited textbook solutions
24/7 expert homework help

10 References Aspromourgos, T. (2008). Adam Smith: a Moral Philosopher and His Political Economy. Bear, L. (2020). Speculation: A political economy of technologies of imagination. Economy and Society , 49 (1), 1–15. Boner, J. (2018). Philosophy and political economy . Routledge. Donoghue, M. (2021). A History of Utilitarian Ethics: Studies in Private Motivation and Distributive Justice, 1700–1875: By Samuel Hollander, Routledge Studies in the History of Economics, London, Routledge, 2020. ISBN 9780367243876. George, E. E. (2019). Tweeting Adam Smith: Using Twitter to Engage Students in the History of Economic Thought. Journal of Economic Teaching , 4 (1), 15–26. Milin, I. A., Lungu, M. R., & Gordan, M. (2022). ADAM SMITH," THE FATHER OF POLITICAL ECONOMY" AND HIS ECONOMIC CONCERNS. Lucrări Științifice Management Agricol , 24 (2), 95. Monette, S. (2019). Classical Growth Theory: Smith, Ricardo, and Marx. Serpa, S., & Ferreira, C. M. (2019). The Concept of Bureaucracy in a Depraved Nigerian Economy: Challenges and Prospects. Int'l J. Soc. Sci. Stud. , 7 , 12. Taylor, J. (2018). Adam Smith: ethics, prediction, and early political economy. In Экономика. Литература. Язык (pp. 122–123). Wang, N. (2021). Robert Malthus, Thomas. (1836). "Introduction," Principles of Political Economy, London: W. Pickering (the first edition was published in 1820). Man and the Economy , 8 (1), 129–140.

Business Philosophy.edited.edited

Related Documents