Adam Smit son of a civil servant, born in Kirkcaldy, near Edinburgh. Adam Smit is the father of classical flow. In his famous book "The Wealth of Nation's (1776, coinciding with the founding of the United States) Smit explained what had always been the principal economic problem, namely how to increase the wealth / prosperity of a country and how wealth is distributed.
According to Smit, the only source of wealth of a country is the production. That is, the more production will be more rich / prosperous a country. Production is more and more can be created through labor specialization can increase production. A concept that transcends time.
"Source: World Economic Fifty-thinker"
The Basic Economic Problems can be divided into:
- Basic Economic Problems In Classical Flow - According to the theory of classical economics, public economics subject matter can be classified to three important issues, namely:
- Production problems
- Distribution problems
- onsumption problem
2. According to the Basic Economic Problems of Modern Flow.
Modern economists agree that the resources available, there are at least three main problems
facing any economy and should be solved by the people as economic subjects.
Modern economists agree that the resources available, there are at least three main problems
facing any economy and should be solved by the people as economic subjects.
- Goods and services what to produce and how much? (what and how much?)
- Which way as to produce? (How?)
- For Whom the Goods and Services Produced? (for whom?)