Laissez-Faire Econmics (Industrial Rev.)

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Laissez-Faire Econmics (Industrial Rev.)

Post  Paola fix on Sun Jan 30, 2011 10:05 pm

Going back to our previous chapters, in The Enlightenment we learned about how physiocrats argued that natural laws should have no interfierance with the government, this was called "Laissez-faire" or (hands-off). The main person who inspired this laissez-faire economics was Adam Smith, who also wrote The Wealth of Nations. He pointed that the free market, meaning not controlled or supervised by laws or regulations to be able to exchange goods an services, would help everyone including rich and poor. Smith said that the market would produce goods for a low prices which would make things affordable for everyone. If the economy grows it will encourage capitalists to reinvest profits in the new things. The supporters of this free-enterprise capitalism brought this idea to the industrial age, where the government played no part. Even the Enlightenment had an impact on the industrial revolution Adam's ideas were definitely positive and would help the economy rise. However another writer, Thomas Malthus predicted that there would be less food supply for the expanding population. He said the only views on population were war, diseases, famine( scarcity of food). If population keeps increasing the poor will suffer, he even urged families to have fewer children. During the early 1800s people accepted Malthus's views, however it proved to be thought of the economy in negativity. Although the population crash continued, food supply was growing even faster. This progress lead to a better living in the western world, and later people actually began to have fewer children. By the 1990s Population growth was no longer a problem in the west, but it still affected other nations.
Paola fix

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