I argue that utilitarianism ethical theory is applicable in the classical ethics and political economy in determining wages. Utilitarianism theories determine the right thing from the wrong concept by focusing on the consequences of the outcome. The most preferred ethical choice is the one that produces the greatest outcome for the public. Therefore, the research paper will base the argument on the labor distribution in the industry.
How should the division of labor be determined?
Adam Smith, An Inquiry into the Nature and Causes of the World Wealth of Nations, discusses how labor division should be based on a productive economy. In the book chapter 1, he provides the principles of productive and unproductive labor in the manufacturing industry. His publication on The Wealth of Nation made him a prominent philosopher on the economic moralities. According to classical economists, they believe that Smith’s philosophies advocate for fair competition in the market under specific principles guided by government policies. In that context, utilitarianism ethics will be applicable because the principles are structured for the public’s benefit. The principles outline the ideal strategy to cope in the labor market.
However, the neoclassical economists criticize Adam Smith Philosophies because they believe he advocates for free market strategy in the political economy. Neoclassical believes in capitalism, whereby they control a particular state’s economy at the expense of the vulnerable in society. Capitalists were known for making economic policies that determined the direction of the economy. The policies favored the high social classes while the policies enslaved the majority of the people.
According to Adam Smith, “The annual labor of every nation is the fund that originally supplies it with all the necessaries and conveniences of life that it annually consumes.” Applying the utilitarian ethical theory, Adam emphasized the ideal way the government should focus on the country’s benefit. A productive state should produce more than what it consumes to promote sustainability. Smith argued that two concepts naturally determined the production to consumption ratio. First, productivity determined by the judgment, ability, and skills in the labor’s guiding principles. Second, the proportion of people of employed labor to that of the unemployed culminated in sustainable production’s natural principles.
However, Adam Smith stated that “No matter what your country’s soil, or territorial size, there are two questions that determine the state’s prosperity.” First, he questioned the efficient organization of the skilled labor force. The second question was, how many productive workers were engaged rather than unproductive labor? Therefore, the arguments of Adam Smith emphasized the benefit of the public interests rather than individual success. In doing so, the utilitarianism theory is effective applicable because it focuses on the outcome of the good concepts in the political economy.
In chapter one of the wealth of the Nation, emphasize on the division of labor. Adam gives a trivial example of a pin factory on how production is divided into several units. Each unit has a particular expert who executes a specific function. For instance, there is labor allocated for drawing wires, straightening, cutting, and making headpins. He revealed that the productive process of the company’s labor is divided into eighteen distinct operations. He believed that if the labor was not divided effectively, the production rate could have been affected. Skilled labor was significant for sustainable production. It ensured that each unit had maximum production due to teamwork.
Why does the division of labor improve productivity, according to utilitarianism?
Adam Smith provided three answers, which he believed contributed to improved productivity. He based his answers on the outcomes of the division of labor, which ethically increased productivity. First, he believed that “the improvement of the workman’s dexterity necessarily increases the quantity of the work he can perform.” Utilitarianism ethical theory shows that if the division of labor is managed efficiently, the industry’s production rate will increase. Therefore, improved production will be determined by the specialization of labor. Specialization improves individual skills, which makes them effective in the industry.
Second, he argued that the division of labor saves time in the production process. In the production process, before the product reaches the final stage, it passes several stages. If there is labor division, there will be proper time utilization rather than performing all tasks by yourself because of jack of all trades, master of none. Therefore, specialization improves the production rate through maximizing available time.
Third, specialization increases the invention that results in the efficient use of machinery in the production process. Adam Smith revealed that “men are much more likely to discover easier and readier methods….when their mind is directed to a single object…” it helps to acknowledge mechanisms of improving production through various technical means. Therefore, the three principles of Adam Smith on how the division of labor increases production is ideal in all types of industry. The production process’s improvement is determined by specialization, which is the primary for the utilitarian ethical theory. Generally, people improve their expertise when specialization integrated properly in the production channel. When productivity increases, the wellbeing of the people in society increases.
How wages of labor are determined according to utilitarianism
Wages should be proportional to the labor provided. According to utilitarianism, the ideal ethical choice produces the greatest good for the greatest number. However, for the capitalist economists, they exploit the ethical theory if the utilitarianism. This is because the output is not proportional to the wages provided. Smith describes capitalists as masters who compensate for labor. He argued that wages of labor are determined by the contract between the two parties who share a common interest. Smith said, “The workmen desire to get as much, the masters to give as little as possible.” Smith criticizes the unethical behavior of the capitalist that does not align with the workmen’s expectations. Since the capitalist determine the progress of the economy, they make policies that exploit labor. They accumulate wealth under the exploitation of the workmen.
Wages should be enough to enable labors to meet their family needs. Smith argues that wages should be four times than the minimum wage. Wages should be more than the minimum wages to facilitate the maintenance of the family. Ethically, wages should be produced but not maintained as per capitalist economists. Consequently, wages are not supposed to fall below the minimum threshold.
In conclusion, politics plays a vital role in the labor industry, which is dominated by capitalists. However, according to utilitarianism’s classical ethical theory, wages should be reproduced more often and should not be below the minimum threshold. Consequently, the output of the division of labor results in increased production. An increase in production increases the wellbeing of society.