Selling an Idea or a Product
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Transcript Selling an Idea or a Product
capitalism Carol Mathias
Adam Smith - Father of
Capitalism
Lived
1723 1790 in
Scotland.
Economist and
philosopher
The Wealth of Nations
Written
in
1776 as a
protest
against
mercantilism.
By the Way…...
FACTOID:
The
full title of Adam Smith’s
book is
–
An Inquiry into the Nature and
Causes of the Wealth of
Nations.
Mercantilism.
System
set up
by Jean
Baptiste
Colbert during
Louis XIV time
in France.
Louis had a problem….
Being
King
was very
expensive.
Louis needed
money….real
bad!
Colbert had a solution!
C
+ I + G + X - M = GDP
Decided
–C
to try
+ I + G + X = GDP
C + I + G + X = GDP
Colbert
made King
Louis rich.
– opportunity
benefit!
C + I + G + X = GDP
But
what
are the
opportunity
costs?
Adam Smith
predicted….
Revolution!!
People
would get
ticked off.
The American
Revolution...
We
weren’t
allowed to
spend our
money the
way we
wanted.
The French Revolution
People
really got
ticked off!
Adam Smith
proposed...
Capitalism!
Let
the
people
decide the 3
economic
questions!
Smith proposed...
People
need
incentives to
work.
Profits are
the best
incentives.
People need
incentives….
PSYCHIC
INCOME.
Entrepreneurs
People
who
take risks
and create
goods and
services &
enjoy profit.
Bill Gates House
Warren Buffet - Omaha’s
billionaire.
Founded Buffy’s
Buffet.
Chairman of Solomon
Brothers Investments.
Chairman of
Borsheim’s Jewelry.
Most expensive stock is
Berkshire Hathaway.
Rose Blumkin – Nebraska
Furniture Mart
1893-1998
“Always sell cheap
and tell the truth.”
Famous entrepreneurs
Buffalo
Bill
Cody.
Created
Wild West
Show for
world.
Ray Kroc - Founder of
McDonald’s
Began
the fast food
revolution.
Adam
Smith
suggested
an
economy of
entreprene
urs.
The Invisible Hand
One
person’s
acting in
their selfinterest is
likely
others.
The Invisible Hand
Runs
all
through the
economy.
Problems
are solved
by it as well.
What Role for
Government in
Capitalism?
Govt. only ties up the
invisible hand.
Even
when well-intentioned,
government just “screws
things up.”
Government should just
keep out of the way of
business.
Laissez-faire.
French
for
“hands off”.
Govt.
should be
laissez faire
with
business.
Smith didn’t mean no
government.
Government
did have
special jobs
to make
economy
work.
Government’s Job
Provide
Infrastructure for
the system.
What Govt.
Provides.
Fire
&
Police
protection.
Transportat
ion system.
Public
education.
Communica
tions.
Smith’s Role for Govt.
Court
system to
define
property
rights.
Military
protection
for borders
and
products.
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