Economics and Politics Essay

327 WordsDec 1, 20132 Pages
Economics and Politics Name: Institution: Course: Date: Economics and Politics Considering my point of view, I would support this assertion, since the commercial deficit arises due to the unsatisfied demand that is in the country as a result of its less production. The country demand ought to be more that what the country can offer, hence leading to taking products as well as services from other countries that have them as surplus. This notion is against conventional opinion that is shared among economists, since the crises that arise can not be deemed to be a series of occurrences that occur subsequently. Consequently, the authors go against the accepted customs among the economists since economical crisis are brought about by factors like individuals and businesses in the economy who make several mistakes, as well as irresponsibility of the government. In my opinion, I would say that subsequently, Schumpeter endorses Marx as a pioneer of growth and considers him as those who initiated growth though Marx is against capitalism. Marx was totally hostile to capitalism whilst agreeing that if well understood it was better foretelling its passing. Schumpeter, on the other hand, approved of capitalism though agreed for several reasons that it would bring dynamism to an end. Schumpeter embarked more on innovation as a defense to his stand on capitalism stating that it sparked entrepreneurship (Roncaglia, 2005 p.427). The theory of under consumption centers its attention upon the market for consumer goods where in the event of equilibrium being preserved in the market, the whole complex machine remains in equilibrium. On the other hand, overproduction occurs, as a result, of less consumer income to buy the goods continuously being produced so as to preserve equilibrium between consumption and production (Roncaglia, 2005 p.427).

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