Economics 103

Spring 2008

Reading Assignment and Questions about Adam Smith (Part 1)

You are assigned to read the following selections from Smith:

Book I, chapters 1-9 and Part 1 of Chapter 10.

These questions will be discussed on Monday, Fdebruary 18

Discussion questions:

1. What benefits arise from the “division of labor?”

2. In Smith, how does technology manifest itself - in other words, what transformation in the workplace is due to technological progress? How does this contribute to the answer to question 1?

3. What primal instincts or propensities do humans posses? Do you agree with Smith about this? What is the result of these instincts or propensities in Smith’s scheme of things? In your opinion, are these instincts “natural” to all humanity or are they learned traits? What experience from your past or your education are you using to support your own point of view?

4. What does Smith assume about the differences in the natural talents of people?

5. [From chapter 3]: What role is played by the “extent of the market” in promoting technological progress?

6. What determines the price/value of all things? What are the three determinants of price?

7. What determines the wages of labor? What causes them to rise? What are the benefits of high wages?

8. What raises the rate of profit? What lowers the rate of profit?