TAILIEUCHUNG - History of Economic Analysis part 23

History of Economic Analysis part 23. At the time of his death in 1950, Joseph Schumpeter-one of the major figures in economics during the first half of the 20th century-was working on his monumental History of Economic Analysis. A complete history of humankind's theoretical efforts to understand economic phenomena from ancient Greece to the present, this book is an important contribution to the history of ideas as well as to economics. | History of economic analysis 182 The first three chapters of Book 1 deal with Division of We are in the oldest part of the building the part already completed in the Draft. Also presumably because in his teaching Smith had so often gone over this subject it is by far the most polished part of the whole. Though as we know there is nothing original about it one feature must be mentioned that has not received the attention it deserves nobody either before or after A. Smith ever thought of putting such a burden upon division of labor. With it is practically the only factor in economic progress. Alone it accounts for the superior affluence and abundance commonly possessed even by the lowest and most despised member of Civilized society compared with what the most respected and active savage can attain to in spite of so much oppressive inequality Draft see Scott op. cit. p. 328 . Technological progress invention of all those machines and even investments is induced by it and is in fact just an incident of it. We shall consider this feature of s analytic schema at the end of this Reader s Guide. Division of labor itself is attributed to an inborn propensity to truck and its development to the gradual expansion of markets the extent of the market at any point of time determining how far it can go ch. 3 . It thus ap-pears and grows as an entirely impersonal force and since it is the great motor of progress this progress too is depersonalized. In Chapter 4 completes the time-honored sequence division of labor-bartermoney and falling far below the level reached by many older authors and particularly by Galiani severs value in exchange completely from value in use. In Chapter 5 which starts with Cantillon s definition of richesse he undertakes to find a measure of the former that is more reliable than is price expressed in terms of money. Equating value in exchange to price and observing that price in money fluctuates in response to purely .

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