2. Outline
Smith’s view of Wealth and the Themes of the
Wealth of Nations
The Theories of Adam Smith
The Theories of Thomas Malthus
The Theories of David Ricardo
Similarities and Differences between Malthus and
Ricardo
3. View of Wealth
Wealth, for Smith, is defined in terms of
consumption or the goods that people consume;
Smith wants to know how to promote the wealth.
How is Smith's view of wealth radically different than
the historical definition of wealth.
What was considered "wealth"?
What did Smith consider to be the component of
wealth?
What did this mean in terms of everyday life?
4. The Wealth of Nations
Smith focuses on two themes in The Wealth of Nations
Small Groups: Discuss Theme 1
What is it that makes a society hold together and function?
How is it that society manages to accomplish the
performance of all of the tasks that need to be done?
What is Smith's "invisible hand" theory?
Small Groups: Discuss Theme 2
Smith's second point has to do with the evolution of society
or what he calls the system of natural liberty of commercial
capitalism
What is the role of self-interest in society? What is the role
of self-interest in the markets?
What is the importance of competition?
5. Theories of Smith
Law of Accumulation
What are capital investments?
What effect do these investments have on output?
What does the capitalist do in his drive for profit?
What stops the profits from being eaten away in the
process?
Law of Population
What effect do higher wages have on workers?
What effect do they have on output?
What role does consumer preference play?
6. Theories of Malthus
Reverend Thomas Robert Malthus was not favorably
inclined towards the state of the population.
Small Group Activity
Discuss his views presented in An Essay on the
Principle of Population as it Affects the Future
Improvement of Society. Write down three points he
was trying to make.
Class Discussion
How does Malthus’s views contrast with Smith’s
economic theories? What was the main difference?
What caused such a change in economic outlook?
7. Theories of Ricardo
Class Discussion
Why did Ricardo view society as a place where certain
groups got ahead and certain ones did not. What were
the two main classes in England at the time? How did
they interact and depend on each other? Who was
better off? Was there any hope for the lower class?
How did Ricardo’s views contrast with Smith’s
economic theories? What was the main difference?
What caused such a change in economic outlook?
8. Malthus and Ricardo
Class Discussion:
Who was closer to Smith’s theories, Malthus or
Ricardo?
How did their upbringings, educations, and vocations
impact their economic views?
Small Group Activity:
Make a chart outlining the similarities and differences
between Ricardo and Malthus's two economic views.
Would you say they have more or less in common?
