Vernon Smith on Adam Smith and the Human Enterprise

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Listen to the EconTalk podcast Vernon Smith on Adam Smith and the Human Enterprise and consider these questions.

1. What is the "Max U" approach to economics, and why does Vernon Smith find this approach insufficient for describing human behavior?

2. How does the trust game work? What did Smith and his colleagues expect to find when they first conducted this experiment in the lab, and why does he now say, "we were dead wrong?"

3. What is Adam Smith's "great social experiment," according to Vernon Smith? How does it illustrate Vernon Smith's claim that "there is no self unless there is a 'we'?"

4. Vernon Smith says that The Theory of Moral Sentiments is all about rules. What sorts of rules does he have in mind, and where do these rules come from?

5. Under what circumstances did Adam Smith believe punishment was warranted, and why, according to Vernon Smith?

6 What is utilitarianism? How did the ideas of utilitarians, like Jeremy Bentham, contribute to the "marginal revolution" in economics, according to Vernon Smith?

7. Vernon Smith says the marginal revolution in economics turned Adam Smith's Wealth of Nations on its head, essentially reversing what Adam Smith said about specialization and the division of labor. What does he mean by this?

8. What role is there for mathematical theory in economics, according to Smith? To what extent do you agree?