Midterm

Question 1

What is the goal of house-hold management?

Answer 1

The goal of household management is to provide that which is necessary to live and that which is useful to the community or family or state that can be stored (natural acquisition). Produce what you need and exchange the excess for that which you cannot produce.

Question 2

Who is able to practice house-hold management and what enables them to do so?

Answer 2

The husband because he is, by nature, more fit to comman

Question 3

What does Aristotle mean by the ‘good life’, and what things does a person require to live such a life?

Answer 3

There are those who think about living only and not living well, they seek to satiate their desires whether they are necessary or not. This requires property, which requires wealth. They come to believe that the whole point of life is gaining wealth, and do their best to either increase the amount of money or stay at the same wealth, but never want to lose any. The number of things needed in order to have a good life is not unlimited. The good life is one where we have the things that make us happy, but are not concerned with greed or acquiring more than is necessary.

Question 4

What does Aristotle think about the institution of slavery?

Answer 4

He thinks slaves are how the “masters” make their money. He defends slavery by saying that some people are born as slaves while others are born as masters. It is not okay to enslave people by “acquisition” but if the relationship is beneficial to both parties that slavery is socially just. If people are not masters of themselves, then it is okay for someone else to be their masters

Question 5

According to Aristotle, why do people exchange goods?

Answer 5

To procure what is necessary for life

Question 6

According to Aristotle, why do they invent money?

Answer 6

As a facilitator of exchange

Question 7

Explain the difference between a natural and unnatural use of a thing, and apply this distinction to money.

Answer 7

Natural use of a thing is when it is used to sustain life, whereas unnatural use is when you use something to gain desires not necessary for you to live. In the instance of money, if you use it to barter for food or shelter, it is natural use, but if you use it to buy something unnecessary than it is unnatural use and it just gaining something for the sake of having it.

Question 8

What principle does Locke use to justify private property?

Answer 8

Everyone own their own persons and the labor which they can perform, therefore whatever you remove from nature, the common property of all, by use of your own labor you have joined that which you have taken with yourself and made it your own.

Question 9

Why does Locke believe that private property improves the industry of people?

Answer 9

Land in and of itself has very little value, without labor. However, once land has been cultivated it can produce, and overall increase the amount of commodities and goods that are available for all other men to use, thereby increasing the industry of all people by giving them more to use.

Question 10

How does Locke defend the right of colonists to their colonies?

Answer 10

Those who put labor into the land and made the land productive have made the colony their property.

Question 11

Why does Locke believe that all people in society benefit from private ownership of resources rather than public ownership?

Answer 11

Private owners make their commodities part of the marketplace which benefits the public

Question 12

How does Locke explain wage labor?

Answer 12

Wage labor is a contractual agreement in which a laborer negotiates with an employer a price that represents the value of his labor and his claim on the property his labor produces. However, the wage earner does not have a right to the product, just a guaranteed wage he negotiated instead of the determined market-value of the product he created. This implies that as long as both parties agree to the price, an employer could pay a wage laborer as little as he wanted.

Question 13

What economic importance does Adam Smith attribute to the division of labor, and why does he believe it has such beneficial effects?

Answer 13

Adam Smith believes the division of labor increases efficient productivity of whatever products are being produced for three reasons: First, it increases dexterity in the workman when they are focused on one particular task, second, it saves time that is often lost in production, and third, it can lead to innovation and creation of machines that replace and assist in labor which can enable one man to do the work of many. Dividing up the labor can increase the amount of people that are working to create a single product, which means more job availability and an excess of that particularly product for the market. It can also increase the “opulence” of a society which increases the standard of living for even for the most poor.

Question 14

Who benefits principally from economic development according to Smith and why?

Answer 14

Everyone because a rising tide lifts all boats

Question 15

What does Smith view as some of the negative social consequences of the division of labor in industrial societies?

Answer 15

Wage labor tends to be devalued, and people are paid less

Question 16

How does he respond to the issue of wealth and inequalities in capitalist society?

Answer 16

Capitalism isn’t about lessening inequalities, but it raises the overall lifestyle. The rich may be getting more rich, but as long as the poor are gaining wealth too then it is fair and just. Cost of living decreases because the price of goods decreases.

Question 17

What is the difference between productive labor and unproductive labor, and why does he argue we should maximize the former in relation to the latter?

Answer 17

Productive labor: labor that adds value to whatever is being labored over; Unproductive labor: that which does not add value. Productive labor produces a commodity, unproductive labor does not. The whole key to an economy is the proportion between productive and unproductive labor: the more productive labor that is purchased the more economic growth, and the more unproductive labor is bought the more stagnant an economy becomes.

Question 18

What does Marx mean with his thesis regarding the fetishism of commodities?

Answer 18

The commodity conceals the social relationship within exchanges.

Question 19

According to Marx, what gives a commodity its value on the market?

Answer 19

The amount of labor or labor time that is necessary for the commodities production

Question 20

How, according to Marx, does the capitalist make money on commodities (this involves explaining the theory of surplus labor value)?

Answer 20

The capitalist makes the work day longer, using part of the day for the laborer to create enough product for the capitalist to pay the laborers their wages, and the rest of the day generating enough product for the capitalist to gain surplus value that goes to the capitalist alone. The capitalist starts out with money, they use it to create a product, and then sell it for money than it took to create the product. M–>C–>M

Question 21

Does Marx believe that the capitalist system of production is socially just?

Answer 21

No, he believes it is an exploitation of labor.

Question 22

Compare Marx to Smith on whether or not the capitalist system is socially just.

Answer 22

Marx believes it to be exploitation whereas Smith believes it to be logical and lucrative because in it individuals can privately own property while also trying to be productive leads to the free market economy, and competition within the free market economy keeps prices close to the fairest natural price, from which only the most efficient producers to benefit.

Question 23

Why does Marx believe that capitalism will give way to another form of society, and what does he think the goal of a worker’s revolution should be?

Answer 23

In order for capitalism to continue, their needs to be production of commodities, but also a consumer. Eventually, it produces more goods than can be consumed, and that leads to periodic crises such as the Great Depression, and it will become so extreme they will try to reorganize society by eliminating surplus labor value. The workers should revolt to own the enterprises they are working for, an economy in which people would work a lot less, more leisure time.

Question 24

What is the impact of commodities on social relations?

Answer 24

You experience material relations between people and social relations between things.