Adam Smith's Biography is Controversial
“Vademecum (‘For those who go out of their way to step on a crunchy-looking leaf’) post a piece (here) 21 Jan on Adam Smith written by somebody (unnamed) who describes him/herself as: “a passionate lover of humanity and life, an enthusiastic artist, a bespectacled Romanticist, a person you’d see simultaneously discussing Tolstoy and Opeth over a cuppa tea, or laughing at the classic “banana peel” prank.”
Make of that what you will of that – he/she is obviously someone with a lively personality.
“Adam Smith’s Marketplace - Father of Economics” Adam Smith (1723-1790) – Adam Smith was born in Scotland. At the age of 3, he was kidnapped by gypsies but soon rescued. A sickly child, he was in the habit of talking to himself when alone and remained absentminded throughout his life, although he had an extraordinary memory. At the age of 28, he became professor of moral philosophy at the University of Glasgow. He was a popular lecturer, and his classes were very well attended. At the age of 40, after the publication of his first book, The Theory of Moral Sentiments, he accepted an appointment as traveling tutor to the young duke of Buccleuch. He accompanied the duke to France and became acquainted with the intellectual leaders of the country, including a number of Physiocrats. When he returned to England, Smith worked on his masterpiece, The Wealth of Nations, for a decade before its publication in 1776. Two years later, he was appointed commissioner of customs in Scotland. Not long before his death in 1790, he expressed the regret that he had “done so little” in his lifetime.
Adam Smith is considered the father of economics. Before him, economics was studied as a branch of politics called political economy or as an area of philosophy. Economics was born as a distinct discipline with the publication of Smith’s The Wealth of Nations in 1776. It was a remarkable book setting forth expositions of basic economic ideas which hold up very well today, along with a mind-boggling amount of factual data.
Among the most important and enduring contributions to economic thought was Smith’s explanation of the beneficial workings of the free marketplace. He explained market equilibrium as follows:
"The quantity of every commodity brought to market naturally suits itself to the effectual demand. It is the interest of all those who employ their land, labour, or stock [capital] in bringing any commodity to market, that the quantity never should exceed the effectual demand; and it is the interest of all other people that it never should fall short of that demand.”
A major thrust of The Wealth of Nations was that the market prices and quantities should be permitted to adjust to their equilibrium levels without any interference from the government. Smith was arguing in opposition to the system of mercantilism under which the government exercised a great deal of control over economic life. The government regulated production and trade with the objective of bringing gold and silver into the coffers of the state.
Smith contended that a nation’s real wealth would be maximized by allowing individuals to make economic decisions based on the forces of the marketplace, unhindered by government regulations. He maintained that in pursuing their own self-interest, people would be guided by an invisible hand to maximize their personal contribution to the economy. Smith’s views have been greatly influenced by the 3 years he spent in France associating with the French Physiocrats. The Physiocrats promoted a policy of laissez-faire, which called for the government to keep its hands off trade and allow prices to seek their natural levels.
Because of his laissez-faire doctrine, Adam Smith is greatly admired by economic conservatives today. But Smith was anything but a conservative in his day. He was, in fact, someone that we might today call a consumer advocate, protesting the special interests backed by governments that profited at the expense of the general public.”
Comment
Always a pleasure to see posts on Adam Smith that inform readers of aspects of his life and works. It’s an even greater pleasure for such posts to avoid known errors and controversial statements. So let me offer some comments along the lines of what would make a more accurate biography of his life and work.
“A sickly child, he was in the habit of talking to himself when alone and remained absentminded throughout his life, although he had an extraordinary memory.”
This is certainly reported about him which, however, I have always felt that this version (mainly from diverse anecdotes) is in steep contrast to his well-defined highly effective role throughout his adult life as an administrator: his central work on the University of Glasgow’s Senate and its “Principal’s Committee”; his central role as a Scottish Commissioner, where he signed the majority of its letters and reports issued by the Commissioners between 1788 and 1790; his effective ‘political’ work relating to his own advancement as an academic under the patronage of the Duke of Argyll and his working for the appointment of others to various posts across public life; and his ‘consultancy’ work for British governments, including for Prime Ministers and their cabinets. The people who described him as ‘absent minded’, etc., were mainly social voyeurs, who reacted negatively to his lack of deference to them, e.g. Alexander Carlyle.
“Before him, economics was studied as a branch of politics called political economy or as an area of philosophy. Economics was born as a distinct discipline with the publication of Smith’s The Wealth of Nations in 1776.”
Adam Smith was a Professor of Moral Philosophy who taught political economy as part of the traditional Scottish syllabus (Scotland had four universities at the time, England has two). His Wealth Of Nations repeated verbatim much of the materials he taught in his classes during 1751-63 (A. Smith, Lectures on Jurisprudence, 1762-4). He was not an economist. Political Economy remained under that name until the end of the 19th century; it was not ‘born’ with Wealth Of Nations. It was never a branch of ‘politics’; it was subsumed under ‘moral philosophy’.
“Among the most important and enduring contributions to economic thought was Smith’s explanation of the beneficial workings of the free marketplace. He explained market equilibrium…”.
I have a lot of problems with this representation of Adam Smith’s political economy. He most certainly was not a theorist of economic equilibrium. Quite the opposite, in fact. The very example given in its context is from a section discussing why the ‘market’ price never settles at the ‘natural’ price; why it gravitates around the natural price, mainly because events occur that disturb the prices demand and supply of the factors, Land, labour, and Capital, and their prices (rent, wages, and profit).
Further, in the division of labour, all the contributory elements that make the, often long, supply chains operational are subject to continual re-divisions of labour and increased specialization, such that unit prices constantly vary as they induce changes in the extent of all the markets and sub-markets that make up the economic system. This is why Adam Smith was not a progenitor of general equilibrium theory. Additionally, he was a theorist of increasing returns and not decreasing returns, the latter of which became, via David Ricardo, the cardinal principle of what became economics. Only recently has Adam Smith’s insight been fully appreciated (starting with the ‘re-discovery’ of Allyn Young’s seminal article of 1928).
‘unhindered by government regulations’.
Another popular notion belied by his views expressed in Wealth Of Nations. Book IV of his work is a stiff critique of government regulations and interference in pursuit of mercantile political economy. But – and it is a big ‘but’ – there is much in Wealth Of Nations showing that he was not opposed the government regulations on principle, especially when they ensured competition on markets, investment in infrastructure that facilitated competition, when they ensured fair treatment of consumers and prevented fraudulent commercial practices, when they were essential to educate children through local schooling, where they would alleviate suffering from ‘loathsome diseases’, and where they were essential for defence of the nation (Britain is an island). Above all, the favoured government funding of an independent justice system.
The actual list of area necessary for government were far more extensive that simply transposing his criticism (he called critique ‘a very violent attack’) from the errors of the government policy of his day into a criticism of the necessary roles of government in general.
“Smith’s views have been greatly influenced by the 3 years he spent in France associating with the French Physiocrats. The Physiocrats promoted a policy of laissez-faire, which called for the government to keep its hands off trade and allow prices to seek their natural levels.
Because of his laissez-faire doctrine, Adam Smith is greatly admired by economic conservatives today.”
Adam Smith did not advocate laissez faire. He did not have a ‘laissez-faire doctrine’. He never used the words, though was familiar with them. He met with the Physiocrats (not all of them favoured laissez faire) in 1765-66. In 1755 he outlined his views on markets in 1755, long before he met them, and his Lectures on Jurisprudence (1762-4) show him to be fairly well set in his analysis of how economies worked before he met with them. He strongly opposed their ideas on the sole productivity of agriculture and their confining of labour productivity to the ‘sterile’ category. That some ‘conservatives’ confuse themselves about laissez-faire is a pity because it weakens their case.
After all the above I am happy to say I am more likely to agree with the post’s author’s last sentence:
Adam Smith was ‘a consumer advocate, protesting the special interests backed by governments that profited at the expense of the general public.”
Make of that what you will of that – he/she is obviously someone with a lively personality.
“Adam Smith’s Marketplace - Father of Economics” Adam Smith (1723-1790) – Adam Smith was born in Scotland. At the age of 3, he was kidnapped by gypsies but soon rescued. A sickly child, he was in the habit of talking to himself when alone and remained absentminded throughout his life, although he had an extraordinary memory. At the age of 28, he became professor of moral philosophy at the University of Glasgow. He was a popular lecturer, and his classes were very well attended. At the age of 40, after the publication of his first book, The Theory of Moral Sentiments, he accepted an appointment as traveling tutor to the young duke of Buccleuch. He accompanied the duke to France and became acquainted with the intellectual leaders of the country, including a number of Physiocrats. When he returned to England, Smith worked on his masterpiece, The Wealth of Nations, for a decade before its publication in 1776. Two years later, he was appointed commissioner of customs in Scotland. Not long before his death in 1790, he expressed the regret that he had “done so little” in his lifetime.
Adam Smith is considered the father of economics. Before him, economics was studied as a branch of politics called political economy or as an area of philosophy. Economics was born as a distinct discipline with the publication of Smith’s The Wealth of Nations in 1776. It was a remarkable book setting forth expositions of basic economic ideas which hold up very well today, along with a mind-boggling amount of factual data.
Among the most important and enduring contributions to economic thought was Smith’s explanation of the beneficial workings of the free marketplace. He explained market equilibrium as follows:
"The quantity of every commodity brought to market naturally suits itself to the effectual demand. It is the interest of all those who employ their land, labour, or stock [capital] in bringing any commodity to market, that the quantity never should exceed the effectual demand; and it is the interest of all other people that it never should fall short of that demand.”
A major thrust of The Wealth of Nations was that the market prices and quantities should be permitted to adjust to their equilibrium levels without any interference from the government. Smith was arguing in opposition to the system of mercantilism under which the government exercised a great deal of control over economic life. The government regulated production and trade with the objective of bringing gold and silver into the coffers of the state.
Smith contended that a nation’s real wealth would be maximized by allowing individuals to make economic decisions based on the forces of the marketplace, unhindered by government regulations. He maintained that in pursuing their own self-interest, people would be guided by an invisible hand to maximize their personal contribution to the economy. Smith’s views have been greatly influenced by the 3 years he spent in France associating with the French Physiocrats. The Physiocrats promoted a policy of laissez-faire, which called for the government to keep its hands off trade and allow prices to seek their natural levels.
Because of his laissez-faire doctrine, Adam Smith is greatly admired by economic conservatives today. But Smith was anything but a conservative in his day. He was, in fact, someone that we might today call a consumer advocate, protesting the special interests backed by governments that profited at the expense of the general public.”
Comment
Always a pleasure to see posts on Adam Smith that inform readers of aspects of his life and works. It’s an even greater pleasure for such posts to avoid known errors and controversial statements. So let me offer some comments along the lines of what would make a more accurate biography of his life and work.
“A sickly child, he was in the habit of talking to himself when alone and remained absentminded throughout his life, although he had an extraordinary memory.”
This is certainly reported about him which, however, I have always felt that this version (mainly from diverse anecdotes) is in steep contrast to his well-defined highly effective role throughout his adult life as an administrator: his central work on the University of Glasgow’s Senate and its “Principal’s Committee”; his central role as a Scottish Commissioner, where he signed the majority of its letters and reports issued by the Commissioners between 1788 and 1790; his effective ‘political’ work relating to his own advancement as an academic under the patronage of the Duke of Argyll and his working for the appointment of others to various posts across public life; and his ‘consultancy’ work for British governments, including for Prime Ministers and their cabinets. The people who described him as ‘absent minded’, etc., were mainly social voyeurs, who reacted negatively to his lack of deference to them, e.g. Alexander Carlyle.
“Before him, economics was studied as a branch of politics called political economy or as an area of philosophy. Economics was born as a distinct discipline with the publication of Smith’s The Wealth of Nations in 1776.”
Adam Smith was a Professor of Moral Philosophy who taught political economy as part of the traditional Scottish syllabus (Scotland had four universities at the time, England has two). His Wealth Of Nations repeated verbatim much of the materials he taught in his classes during 1751-63 (A. Smith, Lectures on Jurisprudence, 1762-4). He was not an economist. Political Economy remained under that name until the end of the 19th century; it was not ‘born’ with Wealth Of Nations. It was never a branch of ‘politics’; it was subsumed under ‘moral philosophy’.
“Among the most important and enduring contributions to economic thought was Smith’s explanation of the beneficial workings of the free marketplace. He explained market equilibrium…”.
I have a lot of problems with this representation of Adam Smith’s political economy. He most certainly was not a theorist of economic equilibrium. Quite the opposite, in fact. The very example given in its context is from a section discussing why the ‘market’ price never settles at the ‘natural’ price; why it gravitates around the natural price, mainly because events occur that disturb the prices demand and supply of the factors, Land, labour, and Capital, and their prices (rent, wages, and profit).
Further, in the division of labour, all the contributory elements that make the, often long, supply chains operational are subject to continual re-divisions of labour and increased specialization, such that unit prices constantly vary as they induce changes in the extent of all the markets and sub-markets that make up the economic system. This is why Adam Smith was not a progenitor of general equilibrium theory. Additionally, he was a theorist of increasing returns and not decreasing returns, the latter of which became, via David Ricardo, the cardinal principle of what became economics. Only recently has Adam Smith’s insight been fully appreciated (starting with the ‘re-discovery’ of Allyn Young’s seminal article of 1928).
‘unhindered by government regulations’.
Another popular notion belied by his views expressed in Wealth Of Nations. Book IV of his work is a stiff critique of government regulations and interference in pursuit of mercantile political economy. But – and it is a big ‘but’ – there is much in Wealth Of Nations showing that he was not opposed the government regulations on principle, especially when they ensured competition on markets, investment in infrastructure that facilitated competition, when they ensured fair treatment of consumers and prevented fraudulent commercial practices, when they were essential to educate children through local schooling, where they would alleviate suffering from ‘loathsome diseases’, and where they were essential for defence of the nation (Britain is an island). Above all, the favoured government funding of an independent justice system.
The actual list of area necessary for government were far more extensive that simply transposing his criticism (he called critique ‘a very violent attack’) from the errors of the government policy of his day into a criticism of the necessary roles of government in general.
“Smith’s views have been greatly influenced by the 3 years he spent in France associating with the French Physiocrats. The Physiocrats promoted a policy of laissez-faire, which called for the government to keep its hands off trade and allow prices to seek their natural levels.
Because of his laissez-faire doctrine, Adam Smith is greatly admired by economic conservatives today.”
Adam Smith did not advocate laissez faire. He did not have a ‘laissez-faire doctrine’. He never used the words, though was familiar with them. He met with the Physiocrats (not all of them favoured laissez faire) in 1765-66. In 1755 he outlined his views on markets in 1755, long before he met them, and his Lectures on Jurisprudence (1762-4) show him to be fairly well set in his analysis of how economies worked before he met with them. He strongly opposed their ideas on the sole productivity of agriculture and their confining of labour productivity to the ‘sterile’ category. That some ‘conservatives’ confuse themselves about laissez-faire is a pity because it weakens their case.
After all the above I am happy to say I am more likely to agree with the post’s author’s last sentence:
Adam Smith was ‘a consumer advocate, protesting the special interests backed by governments that profited at the expense of the general public.”
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