Select an economic school of thought of your choice as per the “Diversifying the Economics Toolkit” (you are
welcome to expand to other schools of thought, a list with additional schools of thought is posted in Moodle) and
describe how it could be used to better address one (or more) of the m...
Marxist economics is one of the schools of thought that are easily identified in the area of
economics. For many this school of thought can be understood through a comprehensive critique
of capitalism as this is the foundation on which this school of thought is built upon. It provides a
perspective where economics is understood from a socialist lens and conclusively through the
revered system of communism. It calls for a transition to these systems since the economic value
is constructed through work rather than the elements that are observed in a capitalist society.
Marxist economics can be implemented to understand the various macroeconomic goals that
have become essential for any economy.
Labor and Theory.
One of the major factors that define Marxist economics is the labor theory of value. This
theory can be considered the backbone of this school of thought. The theory highlights that the
only way of determining the value of a commodity is by exploring the amount of social labor
that is dedicated to the production of the product. Labor needs to be social and considered
necessary therefore the element of time is also measured using this perspective. Social labor and
time are the factors that the theory put forward as the criteria for constructing the value of a
given commodity. This is a stark contrast to the factors that have come to determine capitalism
and its view on value and the economy in general. Marxists point out that the capitalist system
does not account for the laborers hence the use of wages which ends up hurting the people who
produce these products. The capitalist system according to Marxists is a system that exploits the
laborers since they are given wages that do not match the labor they produce or the price of the
goods that they dedicate their time to produce. Laborers are exploited to generate profit
something that is not acceptable according to Marxist economics. It is also key to note that
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