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#1: Explain the common interest that bound the worldly philosophers under a single heading.

In his philosophical and economic discourse, The Worldly Philosophers, Robert L.

Heilbroner accounts for various views of the capitalist economy. Heilbroner sought to explain

the various aspects of capitalism and how such a system functions in both theory and reality; he

does so by elaborating on the theories and principles of the “worldly philosophers” themselves. It

was of common interest to them to explain how this economic system functioned in society and

why it did so.

Essentially, these men’s common interest was much more than economics, for it was

capitalism itself. Many explained how it literally functioned and what exactly made it better. For

Adam Smith digresses on how an unregulated system ceases to instantaneously burn to ashes; as

Smith illustrates, capitalism functions because of man’s natural instincts in regards of self-

interest. Thomas Malthus coupled with David Ricardo demonstrated how population factors

significantly affect the market system; as increased population creates a greater demand for

commodities, thus straining the market system until it meets societal demands. However some of

these philosophers –and economists– sought to understand capitalism, I believe, so they could

transform society into something much better than what it currently was; these men were known

as the Utopian Socialists, such as Robert Owen and John Stuart Mill. For these men were

concerned with the functions of capitalism, undoubtedly, however they sought to change society

with their understanding, by curbing the competition and driving up profits in what they deemed

the perfect society. As for others, such as Karl Marx, they sought out to explain the functions of

capitalism and why it would soon fail (which in some economists’ eyes, it did not entirely).

In summation, these men were all bound together to explain capitalism. Indeed they had

conflicting views on such an economic system, yet they all contributed significantly to a better

understanding of how it functions and why it does so in this market economy.


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#2: Contrast the family and educational backgrounds of Thorstein Veblen, David Ricardo,

Joseph Schumpeter, and John Maynard Keynes.

Born in 1857 to a Norwegian, immigrant family, Thorstein Veblen was of the latter

generation between his other siblings. Initially, he was raised on an agrarian lifestyle, with an

“aloof and distant father,” (Heilbroner, 221) and a “quick and passionate mother,” (Heilbroner,

222). Such personalities clearly shaped Veblen’s own character. It can be deduced that he was

indeed much like his father, Thomas Veblen: an isolated mind. The youthful Veblen derived

most of his advanced intellect from his isolated, independent studies. Shut out from the rest of

the world and his present reality, he indulged in the classic works of many conventional authors,

oftentimes digressing from the matter at hand, only to elaborate on abstruse ideals of other

economists. Though he lectured at many universities, dully, he nonetheless conveyed some of the

most profound ideas and scholarliness, as he did obtain a Ph.D from Yale University.

Contrastingly, David Ricardo is perceived as a man who interpreted economics in a,

“different and far more pessimistic light,” (Heilbroner, 81). Similarly, however, Ricardo too was

from an immigrant family. He could be considered as a man who rose in society all on his own,

as he began working at an early age and eventually accumulated great amounts of wealth by his

middle ages. As for educational background, Heilbroner does not necessarily account for one of

Ricardo; for he only compares him to Thomas Malthus. For it states that Malthus had been

considered “the academician,” while Ricardo was “the theoretician,” (Heilbroner, 83). Thus,

such an allusion demonstrates how Ricardo relied more heavily on his work experience and early

entry into the industry while constructing his economic theories and treatises.

In the case of Joseph Alois Schumpeter, the lavish lifestyles from his family, no doubt,

influenced how his character developed. At an early age, Schumpeter was, “sent to the
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Theresianum, an exclusive school for the sons of the aristocracy…(and) he entered the

University of Vienna…and was immediately a star student,” (Heilbroner, 292). Clearly,

academics were a strongpoint for Schumpeter. From his studies, he was able to obtain vital

positions in regards to financial management, oftentimes referring to his discourse on economics,

The Theory of Economic Development. Thus his academic background plays a key role in his

overall accomplishments.

As for John Maynard Keynes too, academics seemed to be the main contributor to his

character. He was born into a family with already well-known economists, such as his father;

thus he followed very closely in his path. Keynes is conveyed as a man who achieved academic

greatness early on in life; “At fourteen he applied for and won a scholarship to Eton,”

(Heilbroner, 254). Such a feat is no easy accomplishment for such a young man. Moving on to

greater schooling, he went to King’s College at Cambridge, where he was readily recognized as

an asset to the economics sector, for Keynes would later use his knowledge to develop the

economic principles that would be implemented initially in Europe, and would later affect the

rest of society.
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#4: Forecast how the market system is affected by significant change, such as the dearth of labor
during wartime, the increase of women workers, the passage of child labor laws, competitive
price wars between nations, the displacement of human workers by robots, the creation of new
fuels, potential ecological disaster, depletion of natural resources, and the failure of a major
crop, such as cotton or soybeans.

The market system is thought to be guided by the, “invisible hand,” of economics

(Heilbroner, 54). However, it is nonetheless significantly impacted by a myriad of other

socioeconomic factors. Although it is true that man is able to follow his calling and seek profits

in whatever industry he fancies, its important to note that this choices in such a system can

drastically affect the rest of society, as well as the market system itself. One must consider how

social aspects, such as labor, prices, and innovations, can have severe effects on the market

system.

It is essential that we first define what a, “market system,” actually denotes. In a market

system, man is free to do as he pleases, in regards to his profession. For he is free to choose

between becoming a doctor, farmer, etcetera. But how is one to choose? The answer is rather

simple: self-interest. The market system is fueled by the idea of doing whatever it is that fits the

wants of the laborer. In the words of Robert L. Heilbroner himself, “It (self-interest) drives men

to action,” (Heilbroner, 55). It appears as if this entire market system is ran purely on one’s

selfish impulses to acquire wealth and get ahead in life.

Adam Smith once said, “The demand for men, like that for any other commodity,

necessarily regulates the production of men,” (qtd. in Heilbroner, 65). However, this does not

necessarily account for the antithesis scenario; for what happens when an economy and society

lack the labor to meet this demand for men? It has been concluded that the working man’s wages

clearly influence just how much labor is readily at hand; as Smith had explained, the working

class would essentially flock to the industry inundated with demand, all in an attempt to

accumulate wealth. Despite such a notion, it does not address what exactly happens when there is
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a shortage of workers. A prime example of this would be during wartime. During such times, a

society is faced with a significant loss of its workforce. Consequently, the factory owners,

capitalists, and nearly all business owners, scramble to meet their production demand. Therefore,

during this shortage of workers, the market system may not be able to fully supply society with

whatever products or commodities, since it does not have its complete workforce. But it is also

important to note that during times like these, opportunities for others begin to appear. Take the

women workers of the United States during the times of World Wars. As vast portions of the

male workforce were sent overseas, the market system, or capitalism, was left with thousands of

openings. These openings essentially gave women the first opportunity to work outside of the

home and actually take a significant role in the market economy. Although much of their work

was considered to be, “pink-collared,” women, nonetheless, helped to drive this market system;

“Rosie the Riveter” has even become an iconic figure for women workers over history, proving

that women can take part in various industries that were once dominated by man.

Heilbroner later asserts that, “The children in the cotton mills could surely not be market

factors of equal power with the employers who bedded, boarded, and exploited them,”

(Heilbroner, 58). Clearly, the former part is indeed true, but it is the latter part that is imperative

to an in-depth analysis of this market system. It is the exploitation of these laboring children that

brought about several labor laws. The long hours, harsh working conditions, and nominal

remuneration that these children faced that lead many authoritarian bodies to impose such laws

that limited hours, improved working conditions, and advocated for better wages. But how

exactly do these laws affect the market system? It would appear as if it is very similar to the

removal of the working class from society during a time of such heightened demand. By

imposing restrictions on what once made a large portion of the working faction, the market

system temporarily suffers until others of the bourgeois class take the opportunities once held by
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the displaced children. Thus, it would seem probable that certain industries that relied heavily on

children would see a significant halt in production, or at least a slight drop in the amount of it.

In addition, another key aspect of the market system is competition, for it truly makes the

world go round. In a market system that is guided by both self-interest and self-regulation, it is

competition that keeps prices and wages in line with each other. Of course it seems as if

consumers flock to the supplier with lower prices on the same commodity. If one fails to sell

their product at a price lower than their competitors, or worse, fails to match their competitor’s

price, than of course they are bound to be outsold, for it is inevitable. Thus, without competition,

regardless of whether it is local, national, or international, the market system would be

significantly impacted in numerous ways. Companies would soon be able to hold greater shares

over the market, which would, in turn, allow them to fix prices to whatever they deem

appropriate, or more importantly, profitable. As these prices begin to exponentially rise, it is

more than likely that wages would still remain the same; inevitably driving down the standard of

living, number of jobs, and overall quality of life. Thus, competition is crucial to the market

system, for it, in a sense, regulates the businesses in a system based on self-regulation. As Adam

Smith wrote in his Theory of Moral Sentiments, “If he raises his price, his competitors will step

in and take his market away from him by underselling him,” (qtd. in Heilbroner, 56).

However, in order for the businesses to prosper from their earliest ventures in the market,

they must rely on technological advances. These businesses, small and large, rely on everything

from the mechanization of the assembly line, to other new technologies, such as new fuels and

sources of energy. If we examine Joseph Schumpeter’s idea of how profits are created in a

capitalist economy, it becomes clear as to how these technological advances are important to a

market system. “Profits appeared in a static economy when the circular flow failed to follow its

routinized course,” (Heilbroner, 295). This “circular flow” demonstrates the idea that the
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capitalist must break away from the norm and save money by cutting costs; which is the role of

entrepreneurs, but is later discussed. Nonetheless, things such as mechanization and energy

sources are important to the market system since they drive up profits for capitalists. Take the

history of the motor company Ford as an example. Henry Ford utilized the assembly line and

interchangeable parts and was able to not only increase his own profits by cutting his cost of

sales for the Model T, but he also lowered the actual cost to consumers (which also resulted in

greater sales, as affordability was – and still is – an influential factor). Henry Ford’s deviation

from the circular flow is an example of how innovations made his business, like many others,

more profitable. Thus, in the end, it can be concluded that technological innovations have a

positive impact on the market system, as they tend to drive down costs of productions, making

business operations more affordable for owners.

Nonetheless, there are several outside factors that can negatively affect the market

system, such as natural disasters or widespread failure, in regards to cash crops. Account for the

heavy reliance on wheat throughout history. As Heilbroner explains it, “Thus, as the growing

population caused more and more land to be put into use, the cost of producing grain would rise.

So of course, would the selling price of grain, and so too would the rents of well-situated

landlords,” (Heilbroner, 97). But what is to happen when the demand exceeds production, or

what happens when expectations and quotas are not met? Inevitably, the market system, in my

opinion, faces such profound detriment. It can be deduced that should natural disasters ruin a

capitalist’s crop, machinery, factory, etcetera, then of course production costs are bound to rise.

Natural disasters would, of course, drive up the cost of sales as capitalists must now deviate from

their set path of production and factor in new costs; including, but not limited to, new machinery,

maintenance costs, and repairs. But, even worse, should something such as a cash crop fail, then

society is bound to face heightened prices whereas the laborer should be ready to face lowered
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wages. This, I believe, is because there is a significant demand for a scarce commodity, and

wages are lowered in an attempt to cut costs and generate the lost capital. Thus, the capitalists

charge a raised price to account for their losses, because the crop did not yield what had been

expected. So, in the end, the market system is placed under great pressure, as there is no supply

for a commodity in such great demand.

In summation, there are a number of factors that can impact the market system. However,

it is important to note that economics cannot simply be reduced to “simplistic formulas,” for

society does not always follow the traditional path of history. Thus, such ideals put forward by

the Worldly Philosophers themselves may not always hold true. Such forecasts of how the

market system would be affected are only theories, for nothing is ever static, society is always

changing, evolving, and forming new patterns that may deviate from what was once deemed

socially normal.
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#5: Explain why “laissez faire” was a significant concept in Adam Smith’s time.

The idea of “laissez faire,” was a key concept to economics during Adam Smith’s time,

and still it still remains a significant concept in modern economics. He expanded the notion of a

market based primarily on self-regulation, sans government interference. Thus, the idea of a

market economy based solely on self-interest and self-regulation developed from the research

and theories of Adam Smith during the mid and late 1700’s.

Without Adam Smith’s discourse on the principle of “laissez faire,” modern day society

would fail to understand how the capitalist economy maintains a sense of equilibrium, in regards

to prices, wages, supply, and demand. Smith developed the idea that an economy should allow

its laborers to choose freely their profession. Essentially, Smith shows that self-interest and

competition are greatly intertwined. Robert L. Heilbroner explains Adam Smith’s treatise, The

Wealth of Nations, in summation as, “If he charges too much for his wares or if he refuses to pay

as much as everybody else for his workers, he will find himself without buyers in the one case

and without employees in the other,” (Heilbroner, 55). Clearly price and wages play a significant

role in the market economy and in laissez faire economy. This set of checks and balances ensure

that businesses maintain competition amongst each other and that they justly compensate their

workers; if not, then the consequences are vividly delineated by both Heilbroner and Smith, as

previously noted. In addition, Smith also developed the concept of supply and demand, by

stating, “The market…sees to it that those commodities demanded are produced in the right

quantities and ensures that prices for commodities are constantly competed down to their cost of

production,” (qtd. in Heilbroner, 66). It becomes clear that such principles of supply and demand

may not have been possible in an economy with profound government regulation. For if there

were an authoritarian, governing body that regulated the amounts of production, wages, prices,

etcetera, then clearly competition (and profits) would not be as insurmountable and possible as
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they are in the market, laissez faire system.

Without the principles of laissez faire economics, and the contributions from Adam

Smith, then today’s economy would be drastically different. It is probable that the market would

be heavily regulated; all means of productions would be set by the authoritarian body, wages set

to what they deem just, and profits would be invested in what they believe they should. It

becomes evident that without Adam Smith’s ideas on laissez faire systems, the market economy

would not have evolved into what it is today. From Adam Smith, it is learned that without self-

interest and self-regulation, then the economy could possibly have developed into a totalitarian

economy; an economy that would lack one’s freedom to follow their self-interests and embrace

the values of self-regulation.

#7: Explain why utopian philosophers fail to achieve their goals.


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To fully understand why the utopian philosophers failed to achieve their goal of forming

a perfect society, one must first examine what it was that these socialists were in search of. Many

utopian philosophers such as Robert Owen, John Stuart Mill, Count Henri de Rouvroy de Saint-

Simon, and many more, sought out to reorganize society in such a passionate way. These utopian

economists wanted to structure society in such a way that everyone worked and lived in the ideal

world; just wages, fair working conditions, etcetera. Such an appealing world to live and work

in, yet they failed to materialize in reality. The question that society is left with is, why? In the

simplistic words of Robert L. Heilbroner, “Dream worlds have a difficult time contending with

the frictions of reality…” (Heilbroner, 124).

With all of these promising plans for social restructuring, it is saddening to point out why

they failed. They attempted to create “paradise” in amidst of cruelty and calamity. The “Villages

of Cooperation,” “phalansteres,” and the city of New Lanark itself, were all attempts to make the

“dream community,” (Heilbroner, 124). But competition manifested amongst these paradises of

society; rivalry communities formed and competition between them eventually burned these

perfect societies to the ground, figuratively of course. In addition, these utopian philosophers

never truly achieved their goals of creating a fully functional paradise because doing so would

require society to adapt to new principles; however, it seems as if the ideals of self-interest –or

selfishness– have been indoctrinated into the landowners, capitalists, and laborers: essentially

everyone but the utopian socialists themselves. These utopian socialists believed that, “In the

communality of property, in the warmth of common ownership, were to be found the touchstones

of human progress,” (Heilbroner, 126). However, society was unable to –and will not–discover

these “touchstones” until they can truly rid themselves of the selfish impulses that cause them to

seek out wealth and personal gain.

Heilbroner states that, “It is true that they (Utopian Socialists) were all dreamers –but, as
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Anatole France said, without dreamers, mankind would still live in caves,” (Heilbroner, 124).

Despite this being true, some dreams are nothing more than what one desires but never truly

attains. The same philosophy applies to the ideas of the utopians: they sought out to create a

perfect world in a society that could not –and still cannot– adapt to new ideas and abolish

traditional ones. Thus, their dream remains just that, a dream.

#8: Discuss why division and specialization of labor are beneficial to society.
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The division and specialization of labor is beneficial to society in a number of ways. By

simplifying the modes of production, both time and money are saved. Consequently, production

costs are lowered, wages tend to rise, and the affordability of commodities tends to become

reasonable to a wider faction of society. The division and specialization of labor resulted in

various benefits for society, as deeply discussed by Adam Smith.

In Smith’s treatise, The Wealth of Nations, he describes what would be a tedious process

that one must go through to produce a single pin, if society did not embrace the ideals of division

and specialization of labor. He concludes that in a day, “Those ten persons, therefore, could

make among them upwards of forty-eight thousand pins in a day…But if they had all wrought

separately and independently, perhaps not one pin a day…” (qtd. in Heilbroner, 61). Clearly, the

principles of dividing labor cut production time and increase the amounts of production fourfold.

Such ideals were later embraced by other economists and businessmen, such as Frederick Taylor

Winslow and Henry Ford, respectively. Winslow had created the idea of “Taylorism,” a form of

scientific management that simplified production into the simplest forms possible, while Ford

utilized such management to cut production costs and times for his automobiles. One is left to

wonder, however, how does society reap the benefits of such money saving techniques? Well,

Adam Smith once claimed that, “No society can surely be flourishing and happy, of which by far

the greater part of the numbers are poor and miserable,” (qtd. in Heilbroner, 60). By simplifying

production tasks, the need for skilled labor was drastically cut; consequently, society now had

the opportunity to enter the workforce with little or no trade skills, for they were no longer

necessary in some industries. With more jobs available, the “poor and miserable” are given the

opportunity to get ahead in life, to work hard and get themselves out from where they stand in

society. However, the benefits do not only stop there. The division of labor inevitably saved
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many businessmen vast amounts of capital that it leads to what Smith called, “The Law of

Accumulation,” (qtd. in Heilbroner, 63). It states that business begin to collect the savings that

are created from the specialization and division of labor, and later invest it back into other

aspects of the business. The key to success is the reinvestment back into the means of

production: new innovations that make dividing labor even simpler. As tasks become even

simpler, the demand for workers rises, as does wages, typically. Thus, in the end, society reaps

the rewards; job opportunities, a simplified work life, and marginal rises in wages.

The division and specialization of labor has made mass production easier and cheaper

throughout history. Without the division of labor, the costs of typical products and commodities

would, nevertheless, be significantly higher than the norm. By simplifying the means of

production, business owners can accumulate their savings over time, and reinvest them in ways

that lead to greater savings in the long run.


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#10: Explain why World War II helped to end the Great Depression.

During the Great Depression, America suffered from various socioeconomic problems;

massive unemployment, shortage of jobs, inflation, miniscule wages, etcetera. However, when

the United States entered World War II, the economy began to turn around, for America could

once again see the light at the end of the tunnel. But society is left with one question: why? How

is that war could bring an end to economic troubles?

One must first account for the loss of laborers during the wartimes. As the United States

sent thousands of citizens to join the armed forces, the American economy also lost several

thousands of laborers. Consequently, there would soon be a surge of open job positions for the

unemployed to assume. Thus, during wartimes, there is a great displacement of laborers, and as

Adam Smith had once said, “The demand for men, like that for any other commodity, necessarily

regulates the production of men,” (qtd. in Heilbroner, 65). Therefore, in order for the United

States to meet its level of demand for the production of commodities, it had to first meet its

demand for laborers. By doing so, thousands of Americans were soon earning middle class

wages; wages that would go back into the market economy due to the increase of purchasing

power that consumers now had. In addition, during wartimes, the federal government had

established several work contracts with privatized businesses to meet their quotas for supplies

needed in the war. This had profound affects on the market system, as it began to stimulate

consumer wages and spending; eventually leading to the accumulation of wealth and profits for

many capitalists during this time.

Thus, in the end, the United States’ involvement in World War II is believed to have had

robust effects on the American economy. It sparked the end of the Great Depression through a

series of fortunate events, much similar to a domino effect. The displacement of labor inevitably

created a vigorous demand for workers, leading to a greater circulation of capital.


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#13: Explain Keynes’ philosophy of, “priming the pump.”

Although many businesses dislike the idea of government intervention when it comes to

private enterprises, such intervention becomes necessary at times. It is this type of intervention, a

form of bailout, which is known to many as, “priming the pump.” During the early 1900’s, John

Maynard Keynes developed this notion of government assistance, which would essentially

rebound a fallen economy. During the times of the Great Depression, economists sought out new

ways to assist businesses stuck in a dead market, and many turned to the idea of, “priming the

pump.”

According to John Maynard Keynes, a withered economy could be revitalized if the

government reinvests a certain amount of capital back into it. He believed that government

spending would essentially stimulate the economy and get it back on the circular path of robust

production. Heilbroner quotes Keynes’ philosophy from The General Theory, which stated that,

“And so the remedy was perfectly logical: if business was not able to expand, the government

must take up the slack,” (qtd. in Heilbroner, 275). Keynes asserts that the business growth is

sporadic; occurring primarily in short, sudden bursts. Thus, when the market does not see any

growth or expansion for a certain period of time, business slumps and requires assistance in order

to recuperate. This is what Keynes centralized his idea of “priming the pump,” around. In order

for expansion and economic growth to resume, there must be federal spending to create new job

opportunities, stimulate the overall production in the market system, and make saving or the

accumulation of wealth once again possible. By doing so, the market economy is bound to

experience what Keynes calls, “reflation –a pumping-up of incomes…” (qtd. in Heilbroner, 281).

Once the market begins to undergo “reflation,” it can soon embark on the path of economic

recovery, all due to “priming the pump,” or government assistance.

Clearly Keynes’ philosophy of, “priming the pump,” is essential, even in today’s society.
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Throughout history, such principles of government reinvestment have been implemented; take

President Franklin Roosevelt’s “New Deal.” In order to reestablish economic order during a time

of depression, he turned to creating new programs such as the Public Works Administration,

which created thousands of new jobs through government funded programs, many of which

improved the overall infrastructure utilized by many businesses. However, the ideals outline by

Keynes were not only utilized throughout the early years of history; for even in modern society,

economists and authority figures still embrace the idea of “priming the pump.” Account for the

economic stimulus package implemented by President Barack Obama. In an attempt to curb the

recession and reinvigorate the American economy, he has dedicated billions of dollars in

government funding to create thousands of new jobs and implement new public works projects;

very similar to what was done during the Great Depression. Nevertheless, “priming the pump,”

or government assistance has proved to be extremely beneficial to society, as it puts the market

economy back on the static, circular track it once followed.

#15: Discuss the role of the entrepreneur.


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Entrepreneurship is what essentially drives the economy, for it is the entrepreneur who is

the key to creating the systems that get things done. They play an imperative role in the means of

production, as they practically create the overall systems that the capitalist relies so greatly upon.

In society, the entrepreneur seeks to find, in the words of Joseph Schumpeter, “the joy of

creating, of getting things done, or simply of exercising one’s energy and imagination,” (qtd. in

Heilbroner, 297). For it is the entrepreneur who creates the tools needed to make business

possible.

According to Schumpeter, it is the entrepreneur who drives the business to deviate from

its static, circular path; consequently generating profits. For the role of the entrepreneur is to find

new innovations that essentially make production processes, simpler, faster, and cheaper.

Heilbroner elaborates in greater depth on Schumpeter’s ides, stating, “ As a result of these

innovations a flow of income arises that cannot be traced either to the contribution of labor or of

resource owners,” (Heilbroner, 295). This is the role of the entrepreneur: to develop these new

ideas and innovations that make profits possible. In the market economy, or even a capitalist

economy, profits are traced back to the innovative work of the entrepreneur; a man who is

constantly in search of new principles to implement to simplify the various aspects of both

production and business.

#18: Explain why David Ricardo described the landlord as a villain.


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In the chapter titled, “The Gloomy Presentiments of Parson Malthus and David Ricardo,”

Robert L. Heilbroner seeks to explain just why the landlord is perceived as the villain of society.

He refers greatly upon the works of David Ricardo, primarily his economic discourse, Principles

of Political Economy. Ricardo contends that it is the landlord who is the, “unique beneficiary in

the organization of society…he gained at everyone else’s expense,” (Heilbroner, 95). If one

accounts for the role that he plays in society, it becomes clear as to why Ricardo views the

landlord in such a demeaning manner.

The question that society is faced with, however, is quite simple actually: how does one

become so infamously known as the villain of society? Now, the answer to that is not so simple.

In market economy, each person and role of society depends directly on each other. Ricardo

alludes to the growing of wheat to illustrate such an idea. In this case, the capitalist depends on

the laborers for production, and the laborers depend on the capitalists for wages to make a living.

However, in order for a capitalist to generate his profits and accumulate more wealth, he must

rely significantly on the landlord to house such development; by doing so, the landlord reaps the

benefits of rent, which is his source of income and wealth. But it is not the landlord who neither

tills the soil, manages the lines of production, nor oversees the laborers. Yet he still benefits from

the rent that is demanded of the capitalist. Regardless of the quality of land, rent is, nevertheless,

due. Ricardo digresses from the general picture and focuses on how the capitalist is practically

robbed of profits; as greater amounts of production are needed, capitalists must expand into other

areas. By doing so, in the words of David Ricardo, “it would become necessary to push the

margin of cultivation out further,” (qtd. in Heilbroner, 97). As that margin is pushed to new

limits, the cost to produce grain would inevitably rise; consequently, rent would rise as well, as

capitalists utilize more land than before. Clearly, the only one who truly benefits from this entire
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scenario is the landlord. It is through the mere ownership of land that he has created a profound

source of income and wealth. Since various aspects of the market system rely so heavily on the

landlord, he is able to exploit his ownership of land and accumulate wealth so easily in society,

all at the expense of others.

Thus, by examining his role in society, it becomes evident that the landlord truly is the

villain of society. He is able to generate wealth by merely obtaining the rights to a parcel of land;

land that is of great importance to business ventures. He is known as the villain of society

because he drives into the capitalist’s profits; in doing so, he also indirectly raises the costs of

production. In the end, he is seen as a true villain in society; gaining wealth all at the expense of

those around him.


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#19: Characterize Thorstein Veblen’s comments on technology.

Thorstein Veblen was a man who envisioned a society driven by the use of technology.

He believed that the utilization of technology and the mechanization of production was the

climax of history, for he was an empowering advocate of entrepreneurship, as it developed the

new technology needed by capitalists and society. According to Robert L. Heilbroner, Veblen

was often characterized as an “impatient man,” (Heilbroner, 246). For Thorstein Veblen had

extraordinary expectations for society, in regards to the use of technology. He pictured a world

that would implement technology that would take a vast amount of time to first develop.

Robert L. Heilbroner explains the role of technology in context of Veblen’s times,

claiming, “The emergence of technology and science as the leading forces of social change in

modern times –indeed, as the institutional force whose advent en masse was the identifying

element of modern times,” (Heilbroner, 245). Clearly, technology is what compels society to

evolve into more complex processes; allowing the means of production to be simplified for

laborers. Thus, it can be easily concluded that Thorstein Veblen was indeed an advocate for the

integration of technology into society and the production processes it relies on.
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#20: Explain why economics differs from other social sciences and why it can never be reduced
to simplistic formulas.

The fundamentals of economics, nonetheless, differ greatly from other social sciences

that are studied, for economics attempts to explain human behavior in relation to wealth,

commodities, and production. The reason as to why it is impossible to reduce these theories and

laws into universal, simplistic formulas is essentially because human nature is never static, for it

is ever-changing as time continues on. New behaviors develop over time and different people

have different responses to things in life. Thus, economic ideas can never truly be put into simple

formulas, as these formulas, too, would have to be constantly developing into more complex

concepts.

Many other sciences create general laws that account for what is accepted as the social

norm. However, in the case of economics, it is impossible to predict how consumers will react to

a product, how a market will be affected by variables X, Y, or Z, etcetera. Robert L. Heilbroner

asserts this in his closing chapter, stating, “Individuals’ behaviors are obviously more complex

than that of objects…” (Heilbroner, 316). Although many worldly philosophers and economist

attempt to predict how a market system will function in the future, such predictions are never

absolute, for society’s behaviors are constantly changing, making it extremely difficult to predict

what exactly the future holds for both society, capitalism, and the market economy.