Economics Essay Example | Topics and Well Written Essays - 1250 words - 3

Economics - Essay Example According to this system of pricing, it is not as the view of Smith and Marshall of the mixed bag where different people participate in production to a common pool and keep the products for all but is a situation where individuals have control over resources (Sandri 13). While people were producing and living in communities in the past, in the current day, people adopted the issue of capitalism where they advocate for individualism. This means that they maximize profit on any opportunities they have and they are therefore, profit maximizing rather than building a community minded and working to maximize their satisfaction of all (Sandri 31). In the market, different factors that influence the production and exchange of products determine wages and profits individuals or organizations make. The amount of a product in the market is a key determiner of its cost because the law of supply and demand implies that t if the supply is high, and the demand is low, the product will cost little amount of money and the if demand is high and the supply is low, the price will be high. This means that when prices are high, the chances for profit will be high and the vice versa is true even in payment of products and services including labor. In the subjective theory of value, people involve themselves in activities that cause them to exploit the opportunities they have in their environment without disruption from the society. In this theory, reform is not required because it ensures that people have their position in exploiting the environment so that they can get rewards and benefits in a specific venture. In the subjective theory of value, distribution of income among people is not encouraged because different people play different individualistic activities and the benefits of it extend to the one who participated in it (Sandri 21). In the subjective theory of value, people concentrate on the capitalistic models of economic system in which people concentrate on the differen t things that happen in the society and cause competiveness in people. In this model of economy, according to Marx, competitiveness ensures that few have a lot of resources while a large number of people have less to accumulate for their own. This theory of economy ensures privatization of property such as land and capital to various privileged individuals in the society (Sandri 27). My social theory is that capitalism which advocate for individualism and the potential of each individual in establishing a system of production and distribution of benefits. In this model of production, people focus on improving their lives and in the process the economy of all the people are improved. Government laws provide a framework for people to exploit the resources around the economy as well as regulating potential for exploitation of citizen in the capitalistic system. The role of the government in a system of economy should be to ensure stability and sustainability of the system so that there is continuity of production in the economy. Economics is not a pure science that operates according to set out rules but it is a science that operates according to variations that exist within contexts. This implies that people exchange goods and services as determined by the conditions that prevail in the environment in which the processes are taking place. In recommending a policy, a