Question

Adam Smith's arguments in favor of free markets with the advantages of free markets presented in your text. Explain whether these advantages support or challenge Adam Smith's arguments.

Answer 1

The free market is an economic power created by Adam Smith, based on the liberal and neoliberal thoughts of the economy. In this model, Smith guarantees that the forces of demand and supply would determine how the economy should be established, without any government intervention, that is, the government could not interfere in the economy of a country, offering the companies complete freedom over how theirs would be. consumption of raw materials, the relationship with its competitors, or how products would be offered to consumers.

Adam Smith guaranteed that the advantages of this economic model, would be the reduction of the public machine, the improvement of the services provided by private companies, a greater and continuous flow of international capital and the individual enrichment of nations. Although I agree with the advantages defended by Smith, I cannot fail to notice that this model generates a very serious consequence for society, which is the increase of social inequality, through the free market, the government could not impose rules on entrepreneurs who could exploit cruelly the working class.