 |
| image source: aei.org |
In addition to Smith, there are economists David Ricardo who wrote a book on the economics of capitalism. Ricardo wrote a book entitled Principles of Political Economy and Taxation in 1917. Ricardo stated that capital accumulation is the basis of economic expansion. Ricardo supports the principle that does not allow the state to intervene in economic activity. Ricardo said that restriction on private investment need to be abolished. The division of labor and free trade policies will benefit all countries. Ricardo Smith linked the concept of capitalism in the international economic system (Chilcote, 2010: 554).
Ricardo introduces the concept of comparative advantage. In international trade, countries are not only oriented toward absolute excellence, but also on comparative advantage. This emphasise on price competition among exporting countries. A country will certainly choose to import goods cheaper because it is more profitable. This could encourage competition in the production in order to produce goods more efficiently and cheaper (Rohmann, 2000: 7-8).
Thomas Robert Malthus wrote a book entitled Principles of Political Economy in 1820. In his book, Malthus said that the government is not supposed to has sympathy for the poor. According to him, such measures would only reduce the welfare rights of other communities. While Jeremy Betham in his Introduction to the Principles of Morals and Legislation (1769) has argued that human interests should take place in tandem. Government action is acceptable if such action does not represent the interests of particular groups. Individuals should get the freedom in the framework of the limits of moral and legal (Chilcote, 2010: 555).
In a book entitled Capitalism (1991), Arthur Sheldon talk a lot about the market in a capitalist economy. The market has a primary function to allocate the available resources rationally. According to Sheldon, the economic system in a market mechanism serving to develop techniques that are useful in assessing the scarce resources, create incentives to concentrate on the most productive method, providing a tool to assemble and distribute information, as well as creating the output allocation principles in the highest value (Deliarnov, 2000: 29).
For Sheldon, the market is the driving force of prosperity. The market reflects individual needs and desires of the community in general. The market is not an instrument to be used a handful of people who have political power for its own sake. In fact, according to Milton Friedmanin Capitalism and Freedom (1963) the market system can reduce racial and ethnic discrimination effectively. It can be seen from the judging consumer preferences for items based on price and quality and not because of racial background, ethnicity or religion of the seller (Deliarnov, 2000: 29).
0 comments:
Post a Comment