Adam Smith homely observations, making them feel comfortable all along." Classical economists presented competing theories of those of Smith, termed the "labour theory of value". Later Marxian economics descending from classical economics also use Smith's labour theories, in part. The first volume of Karl Marx's major work, "Das Kapital", was published in German in 1867. In it, Marx focused on the labour theory of value and what he considered to be the exploitation of labour by capital. The labour theory of value held that the value of a thing was determined by the labour that went into its production. This contrasts with
Circular flow of income economics, economic reproduction refers to recurrent (or cyclical) processes by which the initial conditions necessary for economic activity to occur are constantly re-created. Economic reproduction involves the physical "production" and "distribution" of goods and services, the "trade" (the circulation via exchanges and transactions) of goods and services, and the "consumption" of goods and services (both productive or intermediate consumption and final consumption). Karl Marx developed the original insights of Quesnay to model the circulation of capital, money, and commodities in the second volume of "Das Kapital" to show how the reproduction process that must occur in any type of society