The Wealth of Nations Chapter 6 Book 1 - Components of the Price of Commodities

In this video, we break down the key components that determine the price of goods: wages, rent, and profit. From early societies, where labor directly influenced the value of goods, to more developed economies, where landowners, workers, and business owners all play a part in setting prices, we explore how these three factors shape the cost of everything from food to manufactured products. We also look at how wages are tied to skill and labor intensity, how profits are linked to capital investment, and how landowners charge rent for the use of natural resources. Understanding these dynamics is key to grasping how wealth is created and distributed in any economy. Whether it’s raw materials like fish or complex products like linen, the price of goods can be traced back to these fundamental principles. Tune in to learn how every commodity’s value reflects these components.

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00:00 - Introduction and Explanation components price of commodities
00:12 - Labor and Value in Early Society
00:38 - Skilled Labor and Wages
01:04 - Accumulation of Stock and Profit
01:37 - Capital and Profit
02:04 - Private Property and Rent
02:27 - Components of Price
03:19 - Summary of Price Components
03:47 - Confusion Between Profit and Rent
04:09 - Prices in Developed Economies
04:41 - Conclusion and Next Steps