of The Wealth of Nations is that capital is best employed for the production and distribution of wealth under conditions of no governmental interference, or laissez-faire, and free trade. In Smith's view, the production and exchange of goods can be stimulated, and a consequent rise in the general standard of living attained, only through the efficient operations of private industrial and commercial entrepreneurs acting with a minimum of regulation and control by governments. To explain this concept of government maintaining a laissez-faire attitude toward commercial endeavors, Smith proclaimed the principle of the "invisible hand": Every individual in pursuing his or her own good is led, as if by an invisible hand, to achieve the best good for all. Therefore any interference with free competition by government is almost certain to be injurious. The division of labor is another crucial component of capitalist society. According to Smith, division of labor benefits society in three ways: "first, to the increase of dexterity in every particular workman; secondly, to the saving of the time which is commonly lost in passing from one species of work to another; and lastly, to the invention of a great number of machines which facilitate and abridge labour, and enable one man to do the work of many." (Smith, Wealth of Nations, p.6)By overproducing one good, one may trade or barter for other goods. In order to trade or barter with another person, one must appeal to that persons self-interest. Hence, self-interest stimulates society. Smith states that this self-interest is the basis of civilization. Although Marx does not disagree with division of labor, he does criticize the self-interest that motivates society. He proposes a society with strict governmental or state control over industry and production. Marx considered capitalism as another phase in the progression of society towards a better economic structure, one without class struggl...
