Economic expansion without human growth investment is both unfeasible and unethical. The goal of economics is not to find answers to economic progress but to prevent it from falling. Economic transformation has been a lengthy process of transferring labor and resources from lower-productivity activities to higher-production. It allows for long-term increases in aggregate worker productivity, resulting in diverse and complex productive activities. It entails basic economic adjustments that increase overall productivity while providing adequate employment and quality. Theories of philosophers such as Adam Smith’s, Marx’s, and Jevons’ triumph of utilitarianism demonstrate this economic shift.
Evident from Adam Smith’s, the transition from manufactories to factories highly altered the technical division of labor. Division of labor is an economic concept that breaks down the manufacturing process into stages, allowing people to concentrate on specialized jobs. From Adam’s idea, the factory system created the division of work, different from the original labor system. Every employee is assigned a specific task in producing the finished product. Each employee specializes in a small task and does not need to be knowledgeable about the entire process (Pettes, 2021). Employment prospects grew as a result of the industrial revolution.
Wages in factories were higher than those earned by farmers and under the prior labor system. According to his law of demand and supply, it would produce sufficient commodities at the lowest price to meet demand in a market economy. Due to competition, division of labor would create better and advanced items. As factories became more common, more managers and workers were needed to run them, increasing the number of jobs available and total productivity. Under Adam Smith’s economic theory, these are the changes in the technical division of labor brought about by the transition from manufactories to factories.
Labor power condenses human labor into something exchanged for money in Marx’s early political-economic ideas. The capitalist’s goal was to supply enough capital for the laborer to survive and produce new laborers. Marxism theory was available to focus on the battle between capitalists and the middle class and the degree to which a nation’s productive resources develop demonstrates the extent to which it had implemented the division of labor. The worth of labor power, like any other commodity, can be defined by the amount of time required for production. In his theory, the value of the labor force is the worth of the means of sustenance necessary for the laborer’s maintenance (Quick, 2018).
In Marx’s theory, labor power is a very special commodity. It is a unique commodity in that it is a characteristic in living people who own it in their bodies. They cannot permanently sell it to others because they own it within themselves; otherwise, it would enslave them, and as known, slaves do not hold themselves in any way (Franco, 2021). Labor, for Marx, is a commodity, which is an external object that satisfies human needs of any type through its qualities and exchanges for something else. As a result, it does not follow the conventional principles controlling commodity trade unless it assumes that capital has conquered all output and home production is non-existent. When it comes to recognizing the existence of labor power, the contrast between necessary and excessive production in all class divisions offers a unique solution. The answer addresses both the amount of wage labor in total working-class work and the wage given for the labor power.
Marginalism is an economic philosophy that states that financial decisions and behavior decide in incremental increments rather than categorically. The question of how much more or less of production or consuming activity a person will engage in is key. By reference, one of the core ideas of economic theory is marginalism, and it explains the disparity in the value of commodities and services. Marginal utility, marginal costs and benefits, and marginal rates of replacement and change are all concepts that stem from the principle of marginalism (Weizsäcker, 2020). Individuals make economic choices on the margin, meaning that the worth of an additional unit of goods or services is decided by how much-increased utility it gives.
Marginalists explain marginal utility as the additional satisfaction that a client obtain from purchasing another unit of a commodity or service. The equation of exchange states that for a customer to maximize their utility, the marginal utility of every item consumed must be equal to its price (Alvino et al., 2018). If not, they can reallocate consumption and gain higher utility with a given income. However, with the reduction consumption rises, and the marginal utility obtained from each extra unit falls. However, it is the incremental gain in utility resulting from the consumption of one more unit. It develops as the satisfaction gained by a consumer with each subsequent team eaten and used to assess utility beyond the first commodity consumed.
Because it permits workers to specialize in specific tasks, division of labor is critical to economic advancement. Workers become more efficient due to specialization, lowering the overall cost of producing things or providing services. Capitalists discarded unfree labor because employees would be untrained, expensive, and scarce. It was a roadblock to the establishment and expansion of the market. Everything in marginal utility will improve and is obtained from each extra declined unit if it is not equal to consumption. As a result, it will plummet when the circumstance is unfavorable for consuming things.
In conclusion, division of labor permits workers to specialize in specific tasks, therefore critical to economic advancement. Workers become more efficient due to specialization, lowering the overall cost of producing things or providing services. Labor is the human component in the production of an economy’s commodities and services. To fulfill rising demand, it’s critical to find enough workers with the proper abilities. As a result, it will plummet when the circumstance is unfavorable for eating things.
References
Alvino, L., Constantinides, E., & Franco, M. (2018). Towards a better understanding of consumer behavior: marginal utility as a parameter in neuromarketing research. International Journal of Marketing Studies, 10(1), 90-106.
Franco, F. L. F. N. (2021). Neoliberal Platform Capitalism and Subjectivity: A Study of the Hybridization between Labor Platformization and Viração in Brazil. South Atlantic Quarterly, 120(4), 795-808.
Pettes, D. E. (2021). Staff and student supervision: A task-centered approach. Routledge.
Quick, P. (2018). Labor power: A “peculiar” commodity. Science & Society, 82(3), 386-412.
Weizsäcker, C. C. (2020). Böhm-Bawerk and Hicks modernized. European Journal of Economics and Economic Policies: Intervention, 17(2), 208-219.
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