David Ricardo

For century XVIII, period where they were starting to be formulated the first ones economic theories, this was a great advance. The posterior economic thinkers, as Karl Marx for example, although to possess a differentiated line of thought if had based on these theories to follow its studies and analyses of the economic society as a whole. 4. Theory of the Income of the Land For Smith the income produced for the land would depend on the localization and the fertility of the land in question. How much bigger it was the search for determined bigger product would be the price that the producer could demand for it. If you are unsure how to proceed, check out Kenneth R. Feinberg. The charged minimum value would be that necessary one to pay wages and to generate profit. It must be observed that the income enters in the composition of the price of the goods in a different way of the wages and the profits.

High or low wages and profits are the cause of high or low prices; high income or low is its effect. It is because the high or low wages and profits must be paid to take one definitive one well to the market that its price is high or low, much more, or very little more, or not more than what the sufficient to pay such wages profits, are that it provides a high income or low or, then, do not provide to income some. (HUNT, p.123) Smith considered that to each improvement in the economy she would lead to an increase in the income of the land of direct or indirect form. Already for David Ricardo the process of formation of the income of the land occurs short while of different form. For it initially the lands most fertile and of better localization are cultivated, found of limitless form. Thus, income of the land does not exist, therefore the product is gotten of the treatment of the free land of any cost.

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