How do the economic theories of Adam Smith and Karl Marx differ in their
views on human nature, labor, the role of the state, progress, and capitalism,
and how have these ideas influenced modern economic thought and policy?

Amer Kapur

doi:10.46609/IJSSER.2025.v10i07.012

Title: How do the economic theories of Adam Smith and Karl Marx differ in their views on human nature, labor, the role of the state, progress, and capitalism, and how have these ideas influenced modern economic thought and policy?
Authors: Amer Kapur
Journal: International Journal of Social Science and Economic Research (IJSSER) ISSN: 2455-8834 Volume: 10 Issue: 7 Publication Date: July 2025 DOI: 10.46609/IJSSER.2025.v10i07.012
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Amer Kapur Shri Ram School Moulsari
MLA 8 Kapur, Amer. "How do the economic theories of Adam Smith and Karl Marx differ in their views on human nature, labor, the role of the state, progress, and capitalism, and how have these ideas influenced modern economic thought and policy?" Int. j. of Social Science and Economic Research, vol. 10, no. 7, July 2025, pp. 2744-2769, doi.org/10.46609/IJSSER.2025.v10i07.012. Accessed July 2025. APA 6 Kapur, A. (2025, July). How do the economic theories of Adam Smith and Karl Marx differ in their views on human nature, labor, the role of the state, progress, and capitalism, and how have these ideas influenced modern economic thought and policy? Int. j. of Social Science and Economic Research, 10(7), 2744-2769. Retrieved from https://doi.org/10.46609/IJSSER.2025.v10i07.012 Chicago Kapur, Amer. "How do the economic theories of Adam Smith and Karl Marx differ in their views on human nature, labor, the role of the state, progress, and capitalism, and how have these ideas influenced modern economic thought and policy?" Int. j. of Social Science and Economic Research 10, no. 7 (July 2025), 2744-2769. Accessed July, 2025. https://doi.org/10.46609/IJSSER.2025.v10i07.012.
References [1] . Smith, Adam. An Inquiry into the Nature and Causes of the Wealth of Nations. 1776. Edited by Edwin Cannan, The Modern Library, 1937. [2] . Marx, Karl, and Friedrich Engels. The Communist Manifesto. 1848. Edited by Gareth Stedman Jones, Penguin Classics, 2002. [3] . Marx, Karl. Capital: A Critique of Political Economy, Vol. 1. 1867. Translated by Ben Fowkes, Penguin Classics, 1990. [4] . Heilbroner, Robert L. The Worldly Philosophers: The Lives, Times and Ideas of the Great Economic Thinkers. 7th ed., Simon & Schuster, 1999. [5] . Stiglitz, Joseph E. The Price of Inequality: How Today’s Divided Society Endangers Our Future. W. W. Norton & Company, 2012. [6] . Piketty, Thomas. Capital in the Twenty-First Century. Translated by Arthur Goldhammer, Belknap Press of Harvard University Press, 2014. [7] . Foley, Duncan K. Adam’s Fallacy: A Guide to Economic Theology. Belknap Press, 2006. [8] . Sowell, Thomas. On Classical Economics. Yale University Press, 2006. [9] . Buchanan, James M., and Gordon Tullock. The Calculus of Consent: Logical Foundations of Constitutional Democracy.University of Michigan Press, 1962. [10] . Marglin, Stephen A. “What Do Bosses Do? The Origins and Functions of Hierarchy in Capitalist Production.” Review of Radical Political Economics, vol. 6, no. 2, 1974, pp. 60–112. [11] . Blaug, Mark. “Was Marx Worth Reading?” Journal of Economic Perspectives, vol. 4, no. 4, 1990, pp. 109–116. [12] . Sandel, Michael J. “What Money Can’t Buy: The Moral Limits of Markets.” The Tanner Lectures on Human Values, Brigham Young University, 1998. [13] . United Nations Industrial Development Organization (UNIDO). Industrial Statistics Database, 2020. [14] . World Bank. World Development Indicators, 2023. [15] . International Labour Organization (ILO). Global Wage Report 2022–2023: The Impact of Inflation and COVID-19 on Wages and Purchasing Power. Geneva, 2023. [16] . OECD. Income Inequality and Poverty, 2023. [17] . Wolff, Richard D. “Understanding Marxism.” Democracy at Work, 2019, www.democracyatwork.info/understanding_marxism. [18] . Boudreaux, Donald J. “Adam Smith and Globalization.” Library of Economics and Liberty, www.econlib.org/library/Enc/AdamSmith.html.
ABSTRACT: This research paper examines the work of two of the most famous contributors of modern economics: Adam Smith and Karl Marx. Set in the wider backgrounds of Enlightenment and Industrial Revolution, the paper makes a thematic comparative study of the main concepts developed, such as human nature, labor and value, the role of the state, vision of progress and criticisms of capitalism. Based on the original sources: the Wealth of Nations and Das Kapital, but with a broad selection of secondary sources and statistics this paper will explain how the ideas propounded by Smith on the necessity of free markets, economy of specialization and the self-interest differ strongly with Marx’s vision on class conflict, surplus labor and exploitation that exists in capitalism. The paper also looks at their perennial legacies in modern economic systems with respect to the neoclassical economic school and liberal capitalism in reference to Smith, and socialist theory, heterodox economics and inequality commentary debates in regard to Marx. Due to the use of data-driven graphics and historical study, the study highlights that the debate concerning market regulation, inequality, and the changing role of a state in global economics still includes both Smith and Marx. Instead of portraying their thoughts as incompatible, the paper argues that a comprehensive understanding of modern economics requires an inclusive approach that draws on the insights of both intellectuals.

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