Principles of Business and Economics 1 - Adam Smith essay
7 views 0 purchase
Course
Principles Of Business And Economics
Institution
Universiteit Van Amsterdam (UvA)
Essay on "Application of the principle of exchange and self-interest in the context of my education at the University of Amsterdam" for the subject of Principles of Business and Economics 1, Business Administration at UvA. Was graded a "pass".
Application of the principle of exchange and self-interest in the context of my education at the
University of Amsterdam
In the first three chapters of his book The Wealth of Nations (1776), Adam Smith explains the
principle of the division of labour, its causes and benefits. He states that the labour division is a result
of natural to humans “propensity to truck, barter, and exchange one thing for another” (Smith, 1776).
According to Smith, labour division helps workers to stay focused on only one or a few particular
tasks, which leads to almost no time loss, higher efficiency, and innovation. Thus, the division of
labour lies in the foundation of economic growth and productivity. The division of labour depends on
the size of a market: large market creates favourable conditions for the division of labour and
manufacturing, whereas in a narrow market it is pointless - a person then has to be good at any manual
work, otherwise they will not be able to survive. As people specialize in producing one particular
product or service instead of many, they start having a surplus of it and lack of other products they
need. This encourages trade or exchange. The principle of exchange is an act of multiple parties who
barter their items of value. It assumes that parties will be acting out of self-interest and that as a result
of this exchange, both parties will be better off. The goal of this essay is to apply the mentioned
concepts of self-interest and exchange to the context of my education at the University of Amsterdam
and to evaluate the effectiveness of the incentives involved in this relationship.
The principle of exchange applies to my relationship with the University of Amsterdam,
where I exchange my time and money for knowledge, experience, and a degree. In this case, both the
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller alexxandra. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $4.49. You're not tied to anything after your purchase.
