a. Production resulting from labor and reources
b. Wealth is increased according to the skill and efficiency of labor
c. Wealth is increased with the percentage of the population that produced and uses it
d. economic progress of the population is determined by the income per capita of the people.
e. the intrusments with which production is increased are the division of labor and the use of machinery
f. improvements in transportaion expands the marketability of products
g. the consequence of this expansion and grwoth of industry and commerce
h. everyone gains from free market on account of the principle of supply and demand which applies to production
(prices and wages)
i. profit is a necessary element of production thus self-interest and competition are important ingreditents of the
productive system.
Thomas robert malthus (1766-1834)
Two circumstances influences malthus the docture of the millennialists and the frequent depression and economic
crises of the industrial revolution because the introduction of machinery had displaced handicraftmen. malthus
believed that england was over populated and someting had to be done.
a. land does not breed, but people breed and multiply.
b. unchecked breeding of people causes population to grow by exponential (geometrical) progression whereas food and
natural resources grow only in arithmetical ratio.
c. According to mathus food is neccesary to mankind and the passion between the sexes is also neccesary
d. REAL WAGES could not rise above the level of subsitence because higher economic conditions would lead to large
supply of workers.
e. WHEN WAGES are kept on the level of subsitence othe surplus of manpower would be eliminated by death. THIS
MALTHUSIAN ANALYSIS is known as the IRON LAW OF WAGES.
Also Malthus elaborated what has been identified as the LAW OF DIMMISHING RETURNS. In everything improvement has a
limit, there comes a point beyond which it does not pay to make additional improvement.