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The Nature and Causes of Profits: The Classical Approach from Smith to Marx

Sean Kimpton

No 2014-07, Working Papers from Auckland University of Technology, Department of Economics

Abstract: The Global Financial Crises has motivated some to rethink the dominance of global capitalism. This has revived an interest in Marxist doctrine and in particular its examination of the notion of exploitation. Marx’s theory of value is central to his examination of exploitation. This paper will show that both these posits of Marx are in error. Further, it will show that Marx draws heavily on Smith’s idea of the primacy of wages. However, this paper will demonstrate that profit, and not wages, are the original source of income. This paper reaffirms the importance of profits and the ability of entrepreneurs and capitalists to pursue them.

Keywords: Adam Smith; Karl Marx; Profit; Exploitation; Labour Theory of Value; Classical Economics (search for similar items in EconPapers)
Pages: 27 pages
Date: 2014-10
New Economics Papers: this item is included in nep-acc, nep-his, nep-hme and nep-hpe
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Persistent link: https://EconPapers.repec.org/RePEc:aut:wpaper:201407

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