Poverty in the Eyes of Adam Smith, David Ricardo and Malthus

Poverty is a situation in which scarcity takes place, or it can be a state where individuals lack a certain amount of materials or money, depending on the phase they are living in. There are many different views, describing this circumstance. Especially, economists have tried to describe it in a definition, but there are different views of referring to the situation among the economists as well. Some describe it as a phenomena and a normal state that always should exist in the society. Others try to blame individuals for living in such a state. They think it is in human strength to decide and work to get out of the situation, while some other economists refer it as weakness of a state and blame the government for it. Poverty has been a part of most great economists’ books, modern and classical. Classical economists such as Adam Smith, David Ricardo and Malthus have had different opinions about poverty and its causes.

200 years ago, Adam Smith, the father of modern economists, wrote about poverty in his books. Smith defines poverty not just as a state where someone does not have accessibility of necessities of life, but defines it as disability of following customs of an existing society. In his popular book, Wealth of Nations, he draws a perfect example of this state, writing “A linen shirt, for example, is, strictly speaking, not a necessary of life. The Greeks and Romans lived, I suppose, very comfortably, though they had no linen. But in the present times, through the greater part of Europe, a creditable day-laborer would be ashamed to appear in public without a linen shirt, the want of which would be supposed to denote that disgraceful degree of poverty, which, it is presumed, nobody can well fall into without extreme bad conduct.” In recent days, Adam Smith’s “linen Shirt” might be a neat suit, a cellphone, proper shoes, and ability of interacting with technology. A person without these would be deprived in the society, and there will be many handicaps for him/her to get a proper job and live a standard life. That person still has food to survive and shelter to settle in, but he/she cannot follow costumes from which the society expects, which makes him/her feel inferior to others. In Adam’s world, poverty is the result of inequality. He thinks that poverty occurs in societies that include vast inequalities. Also in Wealth of Nations, he wrote, “Wherever there is great property there is great inequality. For one very rich man there must be at least five hundred poor, and the affluence of the few supposes the indigence of the many.” Smith has a distinguish answer to the question of, “What is the solution for poverty?” He sees the solution of this state within the poor person’s ability. He thinks that what is lacking in a poor person’s personality and distinguishes him from the riches is the aspiration, writing “The real tragedy of the poor is the poverty of their aspirations.”

Poverty was different in David Ricardo’s eyes. He thought that poverty existed because the lack of food and resources. Since natural resources are limited, Ricardo expected poverty rates to increase. While resources get more limited, costs increase in the same rate. Therefore, more people lose ability of purchasing certain goods. According to worldpoverty.org, Ricardo has concluded that rich will end up using resources over and over, and poverty rates increase. For Ricardo, the solution of poverty was population control since the rate of food supply was not increasing with population growth directly. He accepted the idea of Thomas Malthus about population growth. Ricardo thought that if we stop the fast population growth of population, we can prevent poverty rates from increasing as well. His ideas differ from Adam Smith’s on poverty; they both blame society for it, but in different ways. Adam Smith thinks it is the inequality between individuals of society that causes poverty while David Ricardo thinks it is their over reproducing issue that causes poverty.

Thomas Malthus, well known for his Theory of Population, has talked about poverty as well. Malthus refers to poverty as a phenomenon, something natural that should happen to regulate societies. His ideas about poverty and famine fall in his Theory of Population. In An Essay on the Principle of Population, he wrote that population increases in a geometric ratio of 1, 2, 4, 8, 16… while food supply increases by doubling 1, 2, 4, 6… Overtime, when this continues, there will be a major part people in the world who lack of food because the increase food supply does not meet to the growth of population. Stopping the rapid increase of population growth, nature regulates itself continuously by checks, said Malthus. As he wrote in An Essay on the Principle of Population, “population, when unchecked, increased in a geometrical ratio, and subsistence for man in an arithmetical ratio.” In his opinion, positive checks that are natural causes of depopulation which are starvation, disease, and wars occur, regularly, and population growth drops. Malthus has not only talked about the issue, but its solution as well. Thomas had concepts that were alternative for the checks. Dr. Frank W. Elwell, in his article, ‘Malthus’ Social Theory,’ wrote, “Preventive checks, Malthus recognized, come in many varieties.” In Malthus’ opinion, societies can prevent these checks if they abstain from sex and promote late marriages. Without sex, there will not be reproduction and population growth stops, similar to late marriage which lowers the chance of pregnancy for women. Malthus’ ideas about poverty are totally different from Adam Smith’s. Malthus sees poverty as a natural thing that helps in regulating the problem of over populating whereas Adam Smith refers to poverty as a problem that is caused by inequality among classes and lack of aspiration of poor.

In conclusion, each of these economists tried to answer the question of ‘Why does poverty exist?’ Not only classical economists and thinkers have tried to answer the question, but modern economists do as well. Poverty existed in the past and exists today as well. It is not only about the amount of food that is produced; it is about how it is distributed. Tons of food are thrown away and burnt in different areas of the world while children in Africa are starving to death.

Works Cited

Adam Smith. An Inquiry of Understanding of Wealth of Nations. N.p.: n.p., n.d. Print.

Elwell, Frank E. “Malthus’ Social Theory*.” (n.d.): n. pag. Web. 4 Dec. 2016.

Malthus, Thomas. An Essay on the Principle of Population. London: J.M. Dent, 1914.

“World Poverty.” Economic Poverty. N.p., n.d. Web. 04 Dec. 2016.

Source by Rebaz Sarbaaz Ahmed

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