Adam Smith: The Enlightened Economist, Unraveling the Timeless Wisdom

By Fouad Sabry

Who is Adam Smith

An influential character during the Scottish Enlightenment, Adam Smith was a Scottish economist and philosopher who was a pioneer in the concept of political economy. He was also an important player throughout the time period. His two seminal publications, The Theory of Moral Sentiments (1759) and An Inquiry into the Nature and Causes of the Wealth of Nations (1776), garnered him the title of "The Father of Economics" or "The Father of Capitalism" by a number of individuals. The latter, which is frequently shortened to "The Wealth of Nations," is widely regarded as his major achievement. It is also the first modern work that approaches economics as both an all-encompassing system and an academic field. Instead than attempting to explain the distribution of wealth and power in terms of God's will, Smith makes an appeal to natural, political, social, economic, legal, environmental, and technological variables, as well as the interactions that occur between these aspects. A number of different economic ideas were presented in this text, one of which being Smith's concept of absolute advantage.

How you will benefit

(I) Insights about the following:

Chapter 1: Adam Smith

Chapter 2: Classical liberalism

Chapter 3: David Ricardo

Chapter 4: Economics

Chapter 5: Scottish Enlightenment

Chapter 6: Laissez-faire

Chapter 7: Arthur Cecil Pigou

Chapter 8: Classical economics

Chapter 9: Invisible hand

Chapter 10: The Theory of Moral Sentiments

Chapter 11: The Wealth of Nations

Chapter 12: Productive and unproductive labour

Chapter 13: James Otteson

Chapter 14: Semyon Desnitsky

Chapter 15: The Fable of the Bees

Chapter 16: History of economic thought

Chapter 17: EconTalk

Chapter 18: British philosophy

Chapter 19: Adam Smith School of Economics and Finance

Chapter 20: Perspectives on capitalism by school of thought

Chapter 21: Marxian economics

Who this book is for

Professionals, undergraduate and graduate students, enthusiasts, hobbyists, and those who want to go beyond basic knowledge or information about Adam Smith.

• Language: English
• Publisher: One Billion Knowledgeable
• Release date: Jan 10, 2024

Book preview

Chapter 1: Adam Smith

Adam Smith FRSA was baptized on 16 June [O.S. 5 June] 1723, which prompted him to work with David Hume during the Scottish Enlightenment. Smith got a position at Glasgow, where he taught moral philosophy, and composed and published The Theory of Moral Sentiments at this period. In his latter years, he worked as a teacher, which enabled him to travel around Europe and meet other intellectual giants of his day.

As a response to the general goal of preserving national markets and merchants, mercantilism—now commonly known as cronyism or crony capitalism—emerged.

Smith was born in Fife, Scotland's Kirkcaldy. Adam Smith's father, also named Adam Smith, was a Scottish Writer to the Signet (senior attorney), advocate and prosecutor (court advocate), and Kirkcaldy customs collector. which is a mystery.

Smith's biographer, Scottish writer John Rae, said that Smith was kidnapped by Romani when he was three years old and liberated when others came to his rescue.

At age 14, Smith enrolled at the University of Glasgow and studied moral philosophy under Francis Hutcheson. In Book V, Chapter II of The Wealth of Nations, he remarked, In the University of Oxford, the vast majority of public lecturers have long since abandoned even the pretense of teaching. Smith is also said to have complained to his associates that Oxford authorities once caught him reading A Treatise on Human Nature by David Hume and seized the book and punished him harshly for doing so.

Portrait of Smith's mother, Margaret Douglas

Smith started giving public lectures at Edinburgh University in 1748, In 1759, Smith published The Theory of Moral Sentiments, which included excerpts from his Glasgow lectures. This study explored the relationship between human morality and empathy between actor and observer, or between the person and other members of society. Smith characterized mutual sympathy as the foundation of moral emotions. He based his explanation not on a special moral sense as had been done by the Third Lord Shaftesbury and Hutcheson, nor on utility as had been done by Hume, but on mutual sympathy, a term best captured in modern parlance by the 20th-century concept of empathy, the ability to recognize the feelings that another being is experiencing.

A drawing of a man sitting down

François Quesnay, One of the pioneers of the physiocratic philosophy

Following the publication of The Theory of Moral Sentiments, Smith gained such widespread acclaim that several affluent students enrolled at Glasgow to study under Smith.

Smith's teaching duties required a European trip with Scott, During this period, he instructed Scott on a range of topics.

He was paid £300 per year (plus expenses) along with a £300 per year pension; almost triple his previous wage as a teacher.

Philosopher David Hume, painting

David Hume was a friend and contemporary of Smith's.

From Geneva, The group relocated to Paris.

Here, Benjamin Franklin was introduced to Smith by American publisher and ambassador, Who will lead the resistance in the American colonies against four British resolutions by Charles Townshend a few years later? (in history known as the Townshend Acts), It presented a challenge to American colonial autonomy and placed taxation on a variety of colonial necessities.

Smith discovered the Physiocracy school founded by François Quesnay and discussed with their intellectuals.

The Physiocrats opposed mercantilism, The dominant economic theory of the day was Keynesianism, reflected in their motto Let things be and let them go, le monde va de lui même! (Let do and let pass, The world continues on its own!).

By the time of Louis XIV, France's riches had been almost drained. The difference between productive and unproductive labor — the physiocratic classe steril — was a major concern in the evolution and comprehension of what would become classical economic theory.

Henry Scott's younger brother passed away in Paris in 1766, and Smith's tour as a teacher came to an end soon afterwards.

A plaque of Smith

A commemorative plaque for Smith is located in Smith's home town of Kirkcaldy.

Smith passed away on July 17, 1790, in the northern wing of Panmure House in Edinburgh after a terrible illness. His remains were interred inside the Canongate Kirkyard. It was finally shared between Cecilia Margaret (Mrs. Cunningham) and David Anne, his two surviving children (Mrs. Bannerman). Mrs. Cunningham sold some of the books when her husband, the Reverend W. B. Cunningham of Prestonpans, passed away in 1878. Her son, Professor Robert Oliver Cunningham of Queen's College, Belfast, donated a portion of the remaining to the Queen's College library. Following his death, the remaining volumes were sold. Mrs. Bannerman's library was bequeathed in its entirety to the New College (of the Free Church) in Edinburgh upon her death in 1879, and the collection was moved to the University of Edinburgh Main Library in 1972.

A drawing of a man standing up, with one hand holding a cane and the other pointing at a book

Portrait of Smith by John Kay, 1790

Beyond what may be gleaned from his published papers, not much is known about Smith's personal opinions. His death resulted in the destruction of his personal documents, per his desire.

Regarding Smith's religious beliefs, there has been much academic dispute. His father was a member of the moderate side of the Church of Scotland and had a keen interest in Christianity, The Theory of Moral Sentiments, published in 1759, was marketed by co-publishers Andrew Millar of London and Alexander Kincaid of Edinburgh.

Classical and neoclassical economics disagree on the primary argument of Smith's most significant book, An Inquiry into the Nature and Causes of the Wealth of Nations (1776). The invisible hand is emphasized by neoclassical economics (1776). This last comment on an unseen hand has been interpreted in a variety of ways.

A brown building

Later building on the site where Smith wrote The Wealth of Nations

As a result of the fact that each person strives as much as possible to utilize his capital in the support of domestic business and to lead that industry so that its output is of the highest value, each individual must work as hard as possible to maximize the yearly income of the society. In general, he neither aims nor understands the extent to which he promotes the public interest. By preferring the support of domestic to that of foreign industry, he intends only his own security; and by directing that industry in such a way that its products are of the highest value, he intends only his own profit; and in this, as in many other cases, he is led by an invisible hand to promote a goal that was not part of his original intention. It is not necessarily negative for the society if something was never a part of it. By following his own interest, he often advances the society's interest more effectively than when he seeks to do so. I have never seen a significant amount of good done by people claiming to trade for the public good. It is an uncommon affectation among businessmen, and relatively few words are required to persuade them to abandon it.

Those who consider this assertion to be Smith's fundamental message commonly cite his dictum:

Our supper is not dependent on the generosity of the butcher, brewer, or baker, but on their care for their own interests. We address ourselves not to their humanity, but to their self-love, and we never discuss our needs with them, just their