Foundations of Modern Social Thought: Smith and Marx Comparison Essay

This essay provides a comprehensive comparison and contrast of the economic philosophies of Adam Smith and Karl Marx, two foundational thinkers in the field. It begins by introducing their key works, 'Wealth of Nations' and 'Communist Manifesto,' and highlighting their differing stances on capitalism and communism, respectively. The essay then delves into a detailed analysis of their views on the division of labor, exploring how Smith saw it as essential for economic growth through specialization, while Marx viewed it as a source of social hierarchy. Furthermore, it examines their contrasting perspectives on human alienation, with Smith advocating for trade liberation to maximize profit and human happiness, and Marx emphasizing human alienation under capitalism. The essay concludes by synthesizing their agreement that human happiness is the ultimate goal of work and economic activity. This essay offers valuable insights into the core tenets of these influential economic theories and their relevance in understanding modern economic systems.

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Professor’s Name
Foundations of Modern Social Thought
Date
Introduction
Adam Smith is considered one of the most influential political economists with his
writing on “Wealth of the nation” and as a great philosopher ranging from the writing on
“Theory of Moral Sentiments”. On the other hand, Karl Marx is one of the most renowned social
economists with his writing on “Communist Manifesto”. The comparison between Adam Smith
and Karl Marx is very interesting because each person has a foundation in classical school of
economic though. However, Adam smith is a champion of capitalism while Karl Marx is a
champion of communism. The social and economic ideas of these two men differs more often,
but still, there are some similarities in their reasoning behind ideologies that includes theory of
labor, human alienation, nature, and happiness. The goal of this essay is to compare and contrast
their stand on division of labor, alienation, and human nature in terms of happiness and thereafter
make a recommendation on the theory that it supports.
Similarities and Differences on Adam Smith and Karl Marx
The theory of division of labor puts more emphasis on the social involvement and
specialization in line with skills that people possess. According to Adam Smith (115), he argued
that for division of labor to be successful, each person in the society must be task in any

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economic system in order to have a higher return in terms of capital. According to Smith,
division of labor would still be superior even if a generation was identical because productive
capacity is acquired through learning (Hanley 80). In contrast, Karl Marx viewed the idea of
capitalism as backward and irrelevant in the society. He argued that it would be undemocratic to
force men to compete in order to accumulate wealth (McLellan 498). As a result, he viewed
division of labor as the basis of the social hierarchy.
Even though Adam Smith and Karl Marx differed on capitalism that promotes
specialization, they both agreed that division of labor is necessary in a society. The theory of
division of labor was a critical point of differences between Smith and Marx, but they both
agreed that human cannot be defined apart from his labor since they express their life in terms of
what they produce and how they produce goods and services. As a result, Adam and Marx
acknowledged that a society must actively seek out ways to sustain itself thus without labor and
production, citizens will die and economies will collapse.
According to Adam Smith (469), in the Theory of Moral Sentiments, he argued that
society is a commercial enterprise where trade is inevitable i.e. division of labor should not be
used as an instrument for economic bondage. He emphasized that through domestic and
international trading, economies are able grow in terms economic liberation where they are able
to maximize profit (Smith 463). He said that the state of affair prior to the introduction of
division of labor was a natural desperate state for struggling to survive. As a result, without
economic liberation, human nature would prominently lead to unhappiness due to lack of
resources which he termed scarce. In contrast, Karl Marx believed that humankind, by nature,
are free being who are have the abilities to transform the world in alienation. Marx refuted trade
liberation as being anarchic since they way the market economy is coordinated through

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spontaneous trade dictated by the laws of supply and demand leads uncontrolled ability for
human kind to define their destinies in terms of freedom of choice (Marx 455). He argued that
through capitalism, work become tedious and suitable for technological progress rather than free
and creative humankind. As a result, human happiness is objected through profit maximization
that leads to little concern given to the society. However, both Smith and Marx agreed that
human being happiness is the major foundation for economic growth in a society (Marx 255).
They both believed that happiness of humankind is derived when they work and they output is
maximized either individual, communism, or in capitalism.
Conclusion
Smith believed that capitalism that promotes division of labor through specialization was
essential for an economic growth. In contrast, Marx argued that through the social hierarchy,
there will be increased economic differences in the society that is brought about by diverse
specialization. However, both of them agreed that more importantly, society is the most
important element for economic growth thus it must seek a way to sustain itself through labor
and mass production of goods and service. They also differed on alienation where Smith
believed that society is suppose to engage in trade liberation in order to maximize profit thus
make humankind happy. However, Marx believed in human alienation since humankind, by
nature, is free with the ability to transform that world in alienation. They however agreed that the
main idea for work is for human happiness.

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Works Cited
Hanley, Ryan Patrick, ed. Adam Smith: His life, thought, and legacy. Princeton University Press,
2016.
Marx, Karl. The Communist Manifesto: & Selected Writings. Boxtree, 2018.
McLellan, David, ed. Karl Marx: selected writings. Oxford, 1977.
McLellan, David. "Alienation in Hegel and Marx." the Dictionary of the History of Ideas,
(Virginia University Library), New York: Charles Scribner’s Sons (1973).
Smith, Adam. The wealth of nations: An inquiry into the nature and causes. Global Vision
Publishing House, 2017.