Name _____________________________________

Economic Theories DBQ

Homework due ___________________________________
Learning Target: I can use evidence to support a claim that answers the question: Which economic system
(Capitalism (Smith) or Communism (Marx)) is the most beneficial for a society in the process of
industrialization?

Adam Smith liked the changes happening during industrialization. He said that people motivated by greed and the desire
for profit actually benefit society. He explains his reasoning in his book The Wealth of Nations:

DOCUMENT A

Source: Adam Smith’s answer from The Wealth of Nations, 1776 Vocab

The tailor does not attempt to make his own shoes, but buys them at the shoemaker. The tailor: someone
who makes
shoemaker does not attempt to make his own clothes, but uses a tailor. The farmer attempts to clothes
make neither the one nor the other, but uses those different crafstmen. All of them find it in
their best interests to employ their talents in a particular occupation, and to cultivate and bring occupation: job
to perfection whatever talent or genius he may possess... This is the way in which they have
some advantage over their neighbors and simply purchase whatever else they have the cultivate: improve

occasion for.
possess: have

Every individual, therefore, endeavors as much as he can to direct his resources toward his own endeavors: tries
talents so that its produce may be of the greatest value to themself... every individual neither
intends to promote the public interest, nor knows how much he is promoting it... he intends intends to: tries
only his own gain... to or means to

promote: improve
It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our
dinner, but from their regard to their own interest and their desire for a profit.... public interest:
what’s good for
everyone in
...By pursuing their own interest, people frequently promote the good of the society more
society
effectively than when they really intend to promote it.
benevolence:
1. According to Adam Smith, why do people choose the jobs and occupations that they do? generosity

According to Adam Smith,people choose the jobs and occupations that they do in order. pursuing: going
to make the best profit off of their skills and talents as they can. after

2. According to Adam Smith, why do people bother working hard? frequently: often
People work hard to make the greatest value out of whatever they are trying to sell.

3. Why can’t we expect the butcher and the baker to just give us dinner?
Because the baker and the butcher would want to make a profit. They'd want money.

4. According to Smith, why would a baker who makes baked goods that taste terrible and charges high prices not stay in
business very long?
No one would want to buy his nasty bread for ridiculous prices therefore he would run out
of business due to lack of customers.
5. To make money as a baker, what would you have to do?
In order to make money as a baker you should be able to bake goods that are appetizing to your customers,
because you want them to come back.Making good bread and selling it results in money coming in.

6. How then does the desire to make more money as a baker benefit society?
The desire to make money reuslts in people trying their best, which in turn increases customer satisfaction
and that in turn makes $$$. So this way everyone is able to pay their taxes with the money that they make and they are
able to pay for services that they may want or need.

DOCUMENT A (cont.)
Vocab
The sole purpose of all production is to provide the best possible goods to the consumer at the
lowest possible price. The price of every particular commodity is regulated by the cost of its sole: only
production, the quantity which is actually brought to market, and the demand of those who
commodity:
are willing to pay. product, good

regulated:
When the quantity of any commodity which is brought to market falls short of the demand, all
determined
those who want the product cannot be supplied with the quantity which they want. Therefore,
some of them will be willing to pay more. A competition will immediately begin among them, quantity: amount
and the market price will rise more or less above the natural price. exceeds: is
greater than
When the quantity brought to market exceeds the demand, it cannot be all sold to those who
invisible hand:
are willing to pay the price. Some part must be sold to those who are willing to pay less, so the Smith uses this
price of the commodity falls. term to refer to
all the decisions
of people in an
If one seller endeavours to raise prices without an increase in demand, consumers can simply economy
choose among the other sellers who offer a lower price. As if led by an invisible hand,
competition ensures that sellers provide the best possible goods to the consumer at the
lowest possible price.

7. In your own words, how is the price of a product determined?

The price of a product is determined by: how much it cost to manufacture/make, how much is brought to the store/market
and the amount of people who are willing to pay for it.

8. According to Adam Smith, why do prices for some things rise?

Prices for things rise when there is a new product out but everybody want to but it. The consumer demand will then
try to take it all up resulting in an inflation of the price or possibly a limit. Kind of like with the toilet paper and the covid-19.

9. According to Adam Smith, why do the prices of some things fall?

Sometimes the prices of things may fall because a new product is introduced and the product that was previously
so popular is now not getting bought. since people arent wanting the old product any more it will cause the price of
the product to decrease since there are less people buying it. Just like with fidget spinners.
10. According to Adam Smith, how does competition keep prices low?
Competition keeps prices low byraisng the prices without an increase in demand.

11. According to Adam Smith, what are the ways that acting in your own self-interest actually helps others?
Acting in your own self interest instead of intentionally trying to fit in to please someone helps by letting the
businesses know what they legitamately like and dont like, so that way they businesses are able to find out what
customers ACTUALLY need. And by acting in your own self interest instead of otherwise, you are able to establish what
you need and dont need, therefore saving stuff for the peopleeho actually need it.
Unlike Adam Smith, Karl Marx lived during the later stages of the Industrial Revolution. By then, cities had become
overcrowded and unsanitary, and the working conditions in factories were terrible. Karl Marx, Freidrich Engels, and
others like them looked around and believed that capitalism was not good for society. They believed that cooperation
was not possible and that conflict between the owners of capital (the factories and machines) and those who worked for
them was inevitable. He believed that the struggle between the two groups would eventually lead to a workers
revolution.

Karl Marx describes why industrialization is bad for the working class.

DOCUMENT B

Vocab
Source: Modified excerpt from The Communist Manifesto by Karl Marx and
Freidrich Engels, 1848 bourgeois: middle class –
referring to the factory
owners
The modern bourgeois society...has not done away with class antagonisms. It
has but established new forms of struggle in place of the old ones. Modern antagonisms: hatred
industry has converted the little workshop of the patriarchal master into the between groups of people

great factory of the industrial capitalist. ... They have pitilessly torn asunder
patriarchal: male
the ties that bound men to each other, and have left nothing other than naked
self- interest... Masses of laborers, crowded into the factory, are organized like pitilessly torn asunder: turn
soldiers.... They are slaves of the machine and the manufacturer. Instead of apart without caring, broken
apart without mercy
rising as industry progresses, they sink deeper and deeper into poverty....
masses: large groups
Owing to the use of machinery and to division of labor, the work of the
proletariat has lost all individual character, and consequently, all charm for the proletariat: Marx and Engel’s
word for the working class
workmen. He becomes a limb of the machine, and it is only the most simple,
most monotonous, and most easily acquired knack, that is required of him.” limb: arm

12. According to Marx and Engels, what are 3 ways that industrialization has been bad for the monotonous: boring

proletariat? masses of laborers are crowded in the factory like slave

they have torn apart the ties that bound men together and left nothing but self interest
knack: skill
people are slaves to the machine and the manufacturer

Freidrich Engels, describes what they propose as the solution to Industrialization

DOCUMENT C
Vocab
Source: Modified excerpt from the Principles of Communism by Friedrich
Engels, 1847 state: government

Above all, the state will have to take control of industry and of all the
institute: establish, create
branches of production out of the hands of... competing individuals, and
instead institute a system as a whole, that is for the common account,
common account: common
according to a common plan, and with the participation of all members of good, benefit of all
society. It will... abolish competition....Private property must therefore be
abolished.” abolish: eliminate

13. According to Marx and Engels, what is the solution to the problems of the working class?
By instituting a common account and abolishing competition and to do that they have to abolish competition.
 REVIEW OF THE TWO MAJOR ECONOMIC SYSTEMS:

USE THE STATEMENTS BELOW TO FILL IN THE TABLE

a) Progress results when individuals follow their own self interest

b) Businesses follow their own self-interest by competing for the consumer’s money. Each business tries to produce goods or
services that are better and less expensive than those of competitors.
c) Capitalist employers take advantage of workers. The community or the government must act to protect workers.
d) An unequal distribution of wealth and material goods is unfair. A better system is for the government to distribute goods
according to each person’s needs.
e) Individuals and businesses own property and the means of production
f) Capitalism creates unequal distribution of wealth and material goods. A better system is for the government to distribute
goods according to each person’s needs.
g) Consumers compete to buy the best goods at the lowest prices. This shapes the market by affecting what businesses sell
and for how much.
h) Government should not interfere in the economy because competition creates efficiency in business.
i) The community or the government should own property and the means of production. There should be no private
ownership.
j) Progress results when a community cooperates for the good of all.

Adam Smith Karl Marx/Engels

Capitalism – “The Wealth of Nations” Communism – “The Communist Manifesto”

A
_______ B
, _______, G
________, E
________, J
_______ I
_______ F
, _______, C
________, H
________, D
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Answers to Questions Score

Claim: Answers the question: Which economic system (Capitalism (Smith) or Communism (Marx)) is the
most beneficial for a society in the process of industrialization? Must include your 3 key points you would
discuss in your body paragraphs to defend your choice.
___________________________________________________________________
Communism is the absolute best economic system there is. No questions asked!

___________________________________________________________________
___________________________________________________________________
___________________________________________________________________
Topic of my first body paragraph would be:
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Capitalism has been nothing but problematic. Capitalist have practically turned workers into slaves to make money

___________________________________________________________________
for their own selfish profit.
___________________________________________________________________
The quote I would use as evidence of this topic would be:
___________________________________________________________________
"pitilessley torn asunder the ties that bound men to each other[...]left nothing but naked self interest[...]Masses of
laborers,crowded in the factory[...] like soldiers."
___________________________________________________________________
___________________________________________________________________
___________________________________________________________________
______________________________________________________ From (Doc _________)
My analysis/conclusion as to how this evidence strengthens my argument that this economic system is most
beneficial to an industrializing society :
___________________________________________________________________
By making sure that workers are'nt getting used for self-gain in the workplace, this will increase customer
motivation, which will increase worker revenue, which will then increase profits.
___________________________________________________________________
___________________________________________________________________
___________________________________________________________________
___________________________________________________________________

Topic of my second body paragraph would be:

___________________________________________________________________
communists want to involve the government, in a hope to eliminate individual competition

___________________________________________________________________
___________________________________________________________________
The quote I would use as evidence of this topic would be:
___________________________________________________________________
"It will... abolish competition... private property must therefore be abolished."
___________________________________________________________________
___________________________________________________________________
___________________________________________________________________
______________________________________________________ From (Doc _________)
My analysis/conclusion as to how this evidence strengthens my argument that this economic system is most
beneficial to an industrializing society :
___________________________________________________________________
By involving the government in industrialization matters, communists hope to secure a workers job by eliminating
the competition for that persons workplace by some crazy rich private organization, and in order to do that the
___________________________________________________________________
govrnment must eliminate private property. Therefore taking that threat out of the picture.
___________________________________________________________________
___________________________________________________________________
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Topic of my third body paragraph would be:
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Communism hopes to fix the damage caused by capitalism.

___________________________________________________________________
___________________________________________________________________
The quote I would use as evidence of this topic would be:
___________________________________________________________________
"They are slaves of the machine and the maufacturer. Instead of rising as an industry progresses, they sink deeper
and deeper into poverty[...]Above all the state will have to take control of industry and all of the branches of production
___________________________________________________________________
out of the hands of[..] institute a system as a whole.
___________________________________________________________________
___________________________________________________________________
______________________________________________________ From (Doc _________)
My analysis/conclusion as to how this evidence strengthens my argument that this economic system is most
beneficial to an industrializing society :
___________________________________________________________________
By focusing on how communism can fix damage done by capitalism, the readers will see that communism is
clearly the best choice. If there is a problem and an alternative (and better option) you should go for it. And my
___________________________________________________________________
saying that communism will fix damage done by capitalism enhances the readers view of how communism can heal
___________________________________________________________________
___________________________________________________________________
___________________________________________________________________
0 1 2 3 4
Please complete as soon as Weak answers to questions. Answers to questions are You mostly have it. Answers
possible Claim does not take a position present. Claim takes a show you can focus on the
or have 3 key points that apply position and attempts to question as you read. Claim
to that position. Evidence is establish strong key points. makes sense, evidence
weak or incorrect. Citations Evidence is present but lacks matches claim, citations are
are not present. connection to claim. correct.