References

Question 1

Labour Theory of Value: Smith (1776) stated that:

Answer 1

The real price of a commodity is determined by the toil/effort devoted to acquiring said commodity

Question 2

Division of Labour: Smith (1776):

Answer 2

Uses the example of pin-making production to describe how if each person specialises in different steps of production, every worker’s average production rises via increasing returns

Question 3

System of Liberty: Smith (1776):

Answer 3

Promotes a system of liberty as the best economic structure for the division of labour to take place in

Question 4

Munger (2019) points out that:

Answer 4

Scholars as far back as Ibn Kalduhn in the 14th century have already noted the importance of the division of labour

Question 5

Schumpeter (1987) states:

Answer 5

That “The Wealth of Nations” had absolutely nothing that was entirely original in 1776

Question 6

Dow (1984):

Answer 6

Points out Smith’s tendency to not give credit to his precursors or contemporaries

Question 7

Acemoglu and Robinson (2015):

Answer 7

Were correct to suggest that Marx’s work is of its time and place, thus less relevant today

Question 8

Thaler (2016) argued that:

Answer 8

Behavioural economics is evidence-based economics, and not a a new paradigm shift, but a return to previous approaches; this makes BE a complement to mainstream economics

Question 9

In “The Wealth of Nations”, Smith (1776):

Answer 9

Describes overconfidence bias when discussing “the over-weening conceit of which the greater part of men have of their abilities”

Question 10

In “The Theory of Moral Sentiments”, Smith (1759):

Answer 10

explores loss aversion when describing how “pain is in almost all cases a more pungent sensation than than the opposite and correspondent pleasure”

Question 11

Ther are, however, previous ideas that BE aims to substitue; Friedman (1953) argues that:

Answer 11

Behavioural errors people make cancel each other out (e.g. one person overconsuming and another underconsuming a good)

Question 12

Simon (1957)’s key idea was that of:

Answer 12

Bounded rationality, where rationality is bounded because there are limits to our thinking, and costs to searching and processing information

Question 13

Thaler (1980) agreed with Tversky and Kahneman’s work, arguing that:

Answer 13

Mainstream economics made normative assumptions about consumer choice, and so attempted to find a more positive theory of consumer choice

Question 14

Benartzi and Thaler (2007) discuss:

Answer 14

The reasons why people don’t save enough for retirement

Question 15

George Magnus (2011) argued that:

Answer 15

The global economy at this time [2007-2009 financial crisis] was characterised by rising profits but stagnant economic growth