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Unformatted text preview: 1. In 1776, Adam Smith used the image of an invisible hand to describe capitalism. In 1920 Max Weber described capitalism with the image of an iron cage. What are the most important historical changes that account for this shifting perception? Are they economic, political, cultural, or some combination of these elements? (Assume that the most significant factors explaining this shift are not biographical differences between Smith and Weber.) Use one to three assigned primary source readings in addition to the Smith and the Weber to support your argument. It is extremely important, if one is to discuss the transformation of capitalism from a shining beacon of progress into shackles binding man to his work, to first examine the rise of capitalism to prominence and its causes between 1776 and 1904-1905. Only then can a discussion of the passage into what Weber called the iron cage of capitalism begin, and through a logical system of step by step, cause and effect events and political, economic, and social changes, we see that this changing perspective is logical though ultimately avoidable. In 1776, Smith had developed a new and enlightening view into the necessities of production and trade. Firstly, Smith looked at individual production over time, rather than aggregate amounts produced. By focusing on the individual, rather then on the nation, as economists had previously done, Smith was in effect tying the nations economy to its labor force. This is important because it meant that to generate greater production and so greater income for the countrys rulers, the people had to be treated better by the ruling class. It took quite some time for this idea to take hold, but when it did, production skyrocketed. Also, by adding a limitation to the time period within which production was measured, in this case annually, Smith linked further the people and the economy; He was able to track production, rather than simply accept the resulting change in national treasury monies. With production levels tracked from one year to the next, Smith was able to see the effects of political, cultural, and climate changes on annual amounts produced. This meant closer links between the people and the economy, as now everyone could see the effects of their rulers on their own abilities to produce. effects of their rulers on their own abilities to produce....
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