The Real Adam Smith
By Emily Skarbek
I have just come across a nice two part documentary on Adam Smith available at Free to Choose TV. The videos give those unfamiliar with Smith’s thought a good introduction to his life and work in both the Theory of Moral Sentiments and the Wealth of Nations.
There were several points that I found particularly appealing in this treatment. First, Nicholas Phillipson, author of Adam Smith: An Enlightened Life, points out exchange behavior was at the very core of Smith’s reasoning about both morality and the division of labor. It is operative in Smith’s mechanism of how moral rules emerge and are shaped in society, the impartial spectator. And, of course, it is central in understanding the division of labor.
This division of labour, from which so many advantages are derived, is not originally the effect of any human wisdom, which foresees and intends that general opulence to which it gives occasion. It is the necessary, though very slow and gradual, consequence of a certain propensity in human nature which has in view no such extensive utility; the propensity to truck, barter, and exchange one thing for another. – <a href="http://www.econlib.org/library/Smith/smWN1.html#I.2.1"WN I.2.1
Similarly, the video emphasizes that economics was embedded in Smith’s thinking about moral philosophy, justice, and institutions. This is important, as it helps to correct the mistaken notion that Smith’s work on morality in TMS was wholly disconnected from his ideas concerning how free markets generate widespread prosperity in WN. The former concerns the operative principles governing the intimate order, the latter the principles governing the extended order of exchange. For an excellent piece on Smith’s ideas concerning the moralizing role of commerce, see this paper by Maria Pia Paganelli published in the History of Political Economy in 2010.
Second, the video makes it clear that a central concern for Smith was improving the conditions of the poor. This is a legacy of Smithian political economy that is all too often shadowed by the crude caricature of Smith’s invisible hand. Moreover, the discussion highlights Smith’s opposition to government grants of privilege and how he condemned the East India Company for its operation as a government sponsored monopoly.
Finally, what comes across so clearly is just how revolutionary the ideas of the Scottish Enlightenment were at the time and how foundation these ideas are to contemporary liberalism and economics. Eamonn Butler, of the Adam Smith Institute, talks about how Smith’s evolutionary view of language, institutions, morality, and the market preceded Darwin by roughly a hundred years. Overall, it is a good resource for introducing people to the life and mind of Adam Smith.