Introduction
Generally, economics is the study of society’s manner of allocating the available resources to produce services and goods that its members needs or wants (William J. Boyes, 2012, p. 71). The resources are gathered according to their most valued purposes. Mechanics repair cars. People go to them for this highly skilled purpose than for burgers. A chef would provide the best burgers for their consumers instead of the best car repairs. Lucrative economies have always found ways to elevate the quality of the available resources. An example would be training and educating employees. This would allow the workers to produce the required products and services with a much higher quality and at a much higher efficiency. Creative companies have always established ways on how to combine and use various resources to maximize production.
Fundamentally, economics answers the following questions:
What products should society produce?
For whom should the products be produced?
How should the products be produced?
When should the products be produced?
Products that are produced depend on the demand that the producers get from the consumers. The target market’s acceptance of the products depends on the consumers’ willingness and ability to pay for them. The producers come up with the most profitable and cost-effective way of producing services or goods. The time of production again depends on the demand of the consumers.
The given questions have always been answered differently by varied societies. There were cases when traditions dictated the flow or economy. An example would be India’s caste system. Back then, India controlled the manner of producing goods and services. Indians had no choice but to be restricted to the occupations that their caste system dictated. Another example was the centralized authority of a past government. Here, command economy ruled. The bureaucrats were the ones who determine the answers to the fundamental questions in economy. They issued quotas for production and strict procedures in manufacturing. Such a country was China before the year 1978. A final example would be society’s volunteering members. This has been referred to capitalism. All the economic questions have been freely answered by individuals with free choices. They have always been free from the forces of the government and of their traditions.
In economics, businesses, households, societies, and individuals are evaluated on how they are able to allocate the limited resources. Here, the economists focus on how decisions on savings, investments, spending, and working are done. They also concentrate on the trends and forces that influence these decisions.
Scarcity also plays a major role in economy. It manages the choices that lead to the manner of using the limited resources. Scarcity is considered as an economic problem because it leads to an unlimited need for products in areas of limited means. The society does not have enough productive resources that can help pursue the stated needs. One resource cannot be utilized to produce all the goods in demand. This usually results to a trade-off that sacrifices a product so that the resources can be used to make the other product (BARNETT & MORSE, 1963, p. 119).
This paper aims to find economists that have their own answers to economy’s fundamental questions.
John Locke
Biography and Education
John Lock was an Oxford academic and medical researcher and a British philosopher. He was born in Wrington, Somerset, England, on August 29, 1632. Locke’s father was a military man and a country lawyer who served as captain of the English civil war. He was raised as a Puritan. His father’s English allegiance and connections paved the way for his excellent quality of education.
He first studied at Westminster School in 1647. There, in London, Locke earned the prestige of being called a King’s Scholar. It was a privilege given to only a few selected boys and this allowed him to enter the Christ Church, Oxford University in 1652. He studied medicine at Oxford University. This field was very significant in his life because through it, he became a renowned philosopher. He wrote about epistemology, education, and philosophy. His works helped in establishing Western philosophy.
During his early medical years, he met Lord Ashley, who was destined to become Earl of Shaftsbury. They became close and Shaftsbury convinced Lock to relocate to London and become his private physician. Locke’s responsibilities increased as Shaftsbury’s status grew. Eventually, Locke became Shaftsbury’s secretary of presentation.
After a colorful life and unforgettable writings, Locke died in Essex, on October 28, 1704.
Person of Influence
Lord Ashley of Shaftsbury was the one who influenced Locke in his work. With the responsibilities he gave his doctor friend, Locke’s awareness and thinking about politics grew. Shaftsbury’s influence on and persuasions in Locke’s political thinking and career cannot be denied. The Whig party that Shaftsbury founded gave Locke the outlook on government and rule that he did not forget. The influence enabled Locke to come up with the Two Treatises of Government. Here, he expressed his ideas on the revolution that concerned social contracts and human rights. These concepts eventually stirred the French and American revolutions.
Locke was stimulated by Shaftsbury and this turned him into a political philosopher and diverted his attention away from Medicine. Shaftsbury’s influence brought out the brilliance from Locke even more, enough to have changed the course of society.
On Economics
When it concerned economics, Locke also had a lot to share. He believed that no government (product regulator) should make decisions in regulating interest rates (product). He wrote Considerations of the Consequences of the Lowering of Interest that went against the Parliament. It moved to go against a bill and lower the interest rate from six to four percent. According to Locke, interest is considered a price and if there is a ceiling placed on interest, then it would be unproductive. To Locke, prices are determined by nature’s laws. Today, economists still use his argument when interest rates start to go higher. On money, Locke came up with a theory that its value is inversely proportional to the amount of money that actually circulates. Locke believed that depression is likely to happen if the gold supply would fall, compared to the gold supplies (by miners/ product makers) of the country’s partner in trade. Locke believed that if only a small supply of gold entered Britain (regulated by the consumers’ demands) compared to the gold that enters other countries, then the products and services in Britain would become cheaper. This would then cause more gold to enter England.
Karl Marx
Biography and Education
Karl Marx was born on May 5, 1818 in Trier, Prussia. His full name was Karl Heinrich Marx. His parents were Henrietta and Heinrich Marx who had eight other children. His father was an accomplished lawyer who admired Voltaire and Kant. Both his parents were Jewish but Karl’s father decided to become a Christian at 35, in 1816. Karl was baptized as Lutheran even if Catholicism was the main form of faith in their area. He often equated intellectual freedom to Protestantism.
Marx was only an average student and he started his education at home until the age of twelve. After that, he studied at the Jesuit high school (formerly Friedrich-Wilhelm Gymnasium) for five years in Trier. Karl started to attend classes in the University of Bonn in October 1835. There, he was not exactly an ideal student because of the chaos he participated in. His father insisted that he should attend the University of Berlin, which had a more serious atmosphere for learning.
Eventually, he became a known journalist. His works expelled him from France and Germany. When The Communist Manifesto was published in 1848, he was thrown into exile in London. There, he wrote Das Kapital. He died in London a few years after.
Person of Influence
When Marx was in Berlin, he enrolled in classes on philosophy and law. He was then introduced to G.W.F. Hegel—one of the University professors. At first, Marx was not charmed by Hegel’s teachings but when he became a Young Hegelian, he started criticizing religious and political establishments of his time. This involvement with other radical students turned Marx into a politically zealous person. He did not allow himself to settle down with his upper class wife. He went on and finished his doctorate degree from the University of Jena in 1841. However, he was not able to get a teaching position because of his outright radicalism.
On Economics
Karl Marx believed that workers and capitalists comprised the classes in capitalism. The machinery (capital) and the workers (labor) were brought together by capitalists (product regulators) so that products could be made and that profit could be obtained. The workers had to sell their labor to the capitalists because they did not have the money to make products of their own. A significant part of the profit was from the workers’ hard labor and this brought upon the idea of exploitation. Marx believed that with the proper opportunity, the workers would soon overthrow the capitalists and develop their own powers of production. He knew that eventually, communism would result from the workers’ movement.
Conclusion
John Locke and Karl Marx were two economists who both made their marks in the field of economics. They have truly answered the four fundamental economic questions in their own creative and, sometimes, radical ways. Through the influence of their mentors, they were able to bring out their beliefs and establish their own landmark in economics, revolutionarily. Through the years, they have continuously influenced other people and emblazoned important events. Surely, their legacies will continue to awaken more minds in decades to come, particularly in the field of economics.
References
BARNETT, H. J., & MORSE, C. (1963). Scarcity and Growth. Baltimore: John Hopkins Press.
William J. Boyes, M. M. (2012). Fundamentals of Economics. Mason, OM: South Western
Cengage Learning.
