Markets As A Form Of Production, Use And Consumption.The Meaning Of Article

Markets As A Form Of Production, Use And Consumption.The Meaning Of Property And Water Rights - Article Example This much is seen as acceptable to most theorists and economists, but the motive behind the marketing function is not. Adam Smith, considered to be the father of modern economics, stresses that division of labor which is characteristic of a reasonably large market has come about due to the propensity of man to barter excess goods in exchange for other commodities which he needed for his family needs. He adds that man is motivated by the element of profit in marketing and that the price fixed for a commodity should essentially have a margin over and above the input costs of labor and rent. According to him, "the whole price of any commodity must still finally resolve itself into some one or other or all of these three parts; as whatever part of remains after paying the rent of the land, and the price of the whole labor employed in raising, manufacturing, and bringing it to market, must necessarily be profit to someone" (Smith 22). Smith goes on to argue that this propensity for barter ing and profit will best be supported by a free market economy. Economists over the years have subscribed or gone against this view. But here again, only very few have really contradicted Smith's views on bartering and profit. Marx stated that such a situation will result in greed and eventual exploitation of workers. But two prominent writers namely Karl Polanyi and Robert Heilbroner vehemently argue that a study of history of markets around the world, even in the famous ancient kingdoms goes against the view of Smith with regard to marketing and bartering. The views of these two writers will be analyzed to review the distinguishing features of the new market economy in comparison with earlier market systems followed. The paper also tries to make a comparative study between Donald Worster's view on water as a commodity and Marx's own views. Polanyi had definitive views on marketing motivations and customs regarding the evolution of marketing and states that the views of other theorists on this area were erroneous in a number of areas. As an economist, Polanyi is known for his substantivist approach, a situation where the marketing function was closely aligned with culture, social practices and beliefs of a particular community. The author states that "to start with, we must discard some nineteenth century prejudices that underlay Adam Smith's hypothesis about primitive man's alleged predilection for gainful occupations" (Polanyi 45). He goes on to argue that the current market environment is of recent origin and that most of Europe followed the same standards and sophistication carried on from over the centuries with very little change. To substantiate this, he studies various civilizations and societies from a variety of periods and regions and provides specific examples. In essence marketing has a social function base d on survival and growth of the society rather than for individual gain. Polanyi agrees to the fact that a marketing function is essential in organized societies, but its aim is for overall benefit and growth. A person is expected to share his surplus commodities, whether it is an agricultural or animal product. This generosity will enhance his position in the society. Its benefits are not immediate, but will only come at a later stage, when others respond to this generosity by helping him out with his needs of the time. There are two ways in which this can happen. It can come from individual or common reciprocation. In other words, a particular individual who has benefited from an act of generosity will respond when in a position to reciprocate. The society will also have a common store of products which is