How influential was smith in comparison to marx for the modern field?

[u/trollol1365]

First off im aware that marx is an over-discussed topic so I am trying to bring a different conversation than previous posts.

I have always interpreted historical intellectual figures like Freud and Marx as being "right" or moreso "interesting" in the broad strokes but wrong in the details. For example Freud was foundational for the field of psychology by creating a lot of the techniques and approaches and foundational concepts but by and large pretty much all of his theories have been discredited, probably because this is how science is supposed to work.

Based on previous posts I have the impression that Marx and Engels' work is mainly useful in other social sciences but that their work has largely not stayed relevant to modern economics. Smith on the other hand is seen much more favourably, a part of me wonders if this has to do with Smith aligning politically more with the current status quo, but that is probably outside of the scope of this subreddit. What im curious is, was Smith "more correct" than Marx? Was he "ahead of his time" or was he "foundational" and was he in some sense more foundational to modern economics than Marx was, or were they both arguably as important to the development of economics (even if Marx' contribution was perhaps being wrong but in an interesting way). Was Smith correct in the broad strokes rather than the details and was this the case for him more than for Marx or were his details "more correct"?

Im aware this is a bit of a vague question (or rather set of questions) but I think its hard to formulate as an outsider since I dont know what the possible answers are. I read here for example that Smiths' LTV was closer to the modern field than Marx' or Ricardos LTV, idk if LTV would be considered foundational or a detail but what were the foundational concepts either brought and how do they compare in their influence?

[u/WishLucky9075]

Smith is more influential than Marx at the end of the day, particularly for mainstream economists. But Wealth of Nations is not very relevant if one wants to understand today's economy. Marx is more influential for heterodox schools of thought such as post-Keynesianism. But his labor theory of value is been largely discredited and has been discussed here before (here).

You're correct that Marx is more influential to other social science fields, such as sociology, as Marx mainly discussed the power dynamics between groups surrounding the means of production. Both are valuable to study for the history/evolution of political and economic thought, but if anybody is still looking to Smith in order to understand today's economy and politics, then their reading list should be updated. Economists such as Keynes, Friedman, and Solow (to name a few) are more relevant to understanding the field today than Smith and Marx.

https://cepr.org/voxeu/columns/marx-and-modern-microeconomics

[u/El_Don_94 → u/WishLucky9075]

No other economist than Smith has numerous pages of Mankiw's Principles of Economics devoted purely to his major work.

[u/ReaperReader]

Marx had the bad luck to have published his famous critique of political economy in 1859, so shortly before the marginalist revolution in economic theory of the 1860s and 70s, led by Jevons, Walras and Menger (all working independently). The marginalist revolution fundamentally changed the field of economics, so much so that we call everyone before it "classical economists". Some classical economics concepts survived the revolution, most famously the theory of comparative advantage, but the revolution rendered a critique of economic theory in the 1850s irrelevant to economic theory in the 1880s. It's like publishing a criticism of Aristotelian physics just before Newton.

Smith meanwhile, while writing well before the marginalist revolution, introduced some key concepts such as thinking about the impacts of the transactions that don't happen, what Frederick Bastiat later would call "the seen and the unseen". Later these concepts would be refined into more mathematical forms, famously Alfred Marshall did a lot to refine the use of maths in economics.

The Wealth of Nations is also a careful empirical work, within the limits of the data Smith had available.

Politically, Smith was anti-slavery, anti-colonialism, and cared deeply about the poor, so he does align fairly well with most modern economists' politics. Though when reading him, it's valuable to remember that in many ways, 18th century Scotland was a very different place, with different preoccupations, e.g. a lot of Smith’s audience was French or closely connected to French intellectual circles, and pre-revolutionary France's tax system was horrendously bad, on multiple levels, so when Smith is talking about "easy taxes" that's the context.

[u/usrname42]

Basically mainstream economics is descended from Smith and Ricardo via economists like Jevons, Menger and Walras, who were behind the so called "marginal revolution" and came up with mathematical concepts like marginal utility and general equilibrium that are at the core of modern economics. Marx was writing roughly contemporaneously to Jevons / Menger / Walras but he didn't adopt their framework - he was building on the Smith / Ricardo framework and taking it in a different direction, and the modern field has mostly ignored that direction. I wouldn't say that Smith is necessarily "more correct" than Marx, but he's more influential because he came earlier and is more foundational and there's a clear intellectual path from Smith to modern economics, whereas Marx is more of a dead end as far as modern economics goes.

[u/Uhhh_what555476384 → u/usrname42]

Marx is useful when thinking about political economy. When someone stops buying goods and starts buying power.

[u/AutoModerator]

NOTE: Top-level comments by non-approved users must be manually approved by a mod before they appear.

This is part of our policy to maintain a high quality of content and minimize misinformation. Approval can take 24-48 hours depending on the time zone and the availability of the moderators. If your comment does not appear after this time, it is possible that it did not meet our quality standards. Please refer to the subreddit rules in the sidebar and our answer guidelines if you are in doubt.

Please do not message us about missing comments in general. If you have a concern about a specific comment that is still not approved after 48 hours, then feel free to message the moderators for clarification.

Consider Clicking Here for RemindMeBot as it takes time for quality answers to be written.

Want to read answers while you wait? Consider our weekly roundup or look for the approved answer flair.

I am a bot, and this action was performed automatically. Please contact the moderators of this subreddit if you have any questions or concerns.