Monday, January 21, 2008

A Common Error About a 'Nation of Shopkeepers' Repeated in the FT

Maija Palmer posts on FT.Com (20 Jan) a piece using an alleged statement by Adam Smith that is a distortion of history:

Shoppers find goods well recommended:

“When the 18th century economist Adam Smith described Britain as a “nation of shopkeepers”, he had bricks-and-mortar premises in mind. Yet a new online service enabling users to set up their own internet shop in five minutes without having to stock any merchandise could make his claim a virtual reality.”

Adam Smith did not quite say this. What he did say in relation to the mercantile policies pursued by the British government, which imposed (backed by the might of the Royal Navy) a total monopoly on trade with (imports and exports) in the British Colonies in North America:

“To found a great empire for the sole purpose of raising up a people of customers may at first sight appear a project fit only for a nation of shopkeepers. It is, however, a project altogether unfit for a nation of shopkeepers; but extremely fit for a nation whose government is influenced by shopkeepers.” (WN IV.vii.c.63: p 613)

It was Napoleon who described, sarcastically, Britain was a ‘Nation of Shopkeepers’, not Adam Smith. The repetition of such small errors eventually becomes a set belief (like not visiting a pin factory!) and Adam Smith's legacy is chipped away.


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