Sunday, February 24, 2013

Adam Smith's Sources for Pin-Making

Jean-Louis Peaucelle ( University of Reunion Island, France) and Cameron Guthrie (
University of Toulouse, Toulouse Business School, France)
HOW ADAM SMITH FOUND INSPIRATION IN FRENCH TEXTS ON PIN MAKING IN THE EIGHTEENTH CENTURY”, History of Economic Ideas’, xix/2011/3. [History of Economic Ideas is an international peer-reviewed journal, University of Pisa. Italy].
Adam Smith found inspiration in French texts on pin making to illustrate his theory of the division of labour. He used secondary sources that, we argue influenced his understanding of the strong division of labour and opportunities for productivity improvements in the pin-making industry. The original and secondary texts are examined here to understand how Smith interpreted them to develop his theory. Additional archival sources describing French pin making in the eighteenth century are also studied and are shown to partially contradict Smith’s theory of the division of labour.
In the first part of our paper, we study all the eighteenth-century French pin making texts. These texts are closely linked and copy one an- other. Copying without quoting was common practice for the time.
In the second section, we debate how Adam Smith interpreted the French pin-making texts, the information he selected and the conclusions he drew about the pin making industry. We will see that the original texts do not support Smith’s analysis. The workers were specialized in eight or nine trades, and not eighteen as Smith understood. In a workshop there were many workers for heading but very few for cutting the pins, for example. Attempts to divide this latter operation further were unsuccessful. One of the original texts that Smith did not consult also provides an example of production without specialisation where productivity was a hundred times higher than Adam Smith believed.
In the third section, we examine what local sources reported on pin making at the time. These texts help understand how pin-making was organized. We will see that both specialized and non specialized labourers worked together in workshops. While the different workshops all used the same tools, the organization of work was not standardized. One of these texts was also used by Charles Babbage who argued that wage differentiation was another advantage to specialisation (Babbage 1832). 
… French economists at the time, such as François Quesnay (1694-1774), did not comment the Academy of Sciences technical descriptions or those published in the Encyclopédie. They discerned neither specialization in the workshops nor high productivity. The dominant economic intellectual movement in France at the time, physiocracy, was more interested in agriculture than industry and the crafts that were not
considered to be productive activities. Jean-Claude-Marie-Vincent de Gournay (1712-1759) and Anne-Robert-Jacques Turgot, Baron de Laune (1727-1781) recognized the importance of the industry but did not comment the descriptions of the pin making process as Smith did. To Adam Smith’s credit, he chose to study the pin industry and its mechanization that was more visible in eighteenth-century England than in France. …
… We have demonstrated here that Adam Smith’s description of pin making was over-simplified. We did not evaluate the impact of his economic theory. More work is needed to understand how Adam Smith established the relationship between the division of labor and productivity. The weak probative value of his pin-making example takes nothing away from the reach of his economic ideas.”
Jean-Louis Peaucelle has done a magnificent job with his detailed study of the French sources from the 17th and 18th centuries.  His latest essay (with Cameron Guthrie) follows his earlier publication, Peaucelle J.-L. 2006, ‘Adam Smith’s use of multiple references for his pin making example’, The European Journal of the History of Economic Thought, 13, 4, 489-512.
I read this essay in 2007 and found it excellent in quality.  I was unable to comment on it at the time, other than to refer readers to it in my 2nd edition of “Adam Smith: a moral philosopher and his political economy” p. 54, Palgrave, 2008”. (I also sent a private communication to Jean-Louis congratulating him on his well-researched findings).
Adam Smith’s example from pin-making clearly originated from French sources.  Jean-Loius Peaucelle establishes that fact beyond doubt.  The only acknowledgment that Smith gave for his pin-making sources in Wealth Of Nations (Book 1, Chapter 1) is rather vague: “To take an example, therefore, from a very trifling manufacture; but one in which the division of labour has been very often taken notice of, the trade of the pin-maker …”,
But with multiple sources in French, many of them obscure, he probably thought that hi vague acknowledgement was sufficient.   Jean-Lois Peaucelle considers that Smith got the arithmetic wrong and made his asserted relationship between the division of labour and labour productivity suspect.
For the moment, I shall park that conclusion to one side and take my time to digest the arithmetic.  However, regular readers may know that I have long asserted my own view that Adam Smith’s detailed reference to the division of labour as a process was of much more significance than the division of labour in pin-making (there is after all a limit to role splitting in a small workshop).  Smith’s rather neglected example of the manufacture of a labourer’s woolen coat gives a highly significant example of the social benefits of the division of labour in a complex supply chain:
The woollen coat, for example, which covers the day-labourer, as coarse and rough as it may appear, is the produce of the joint labour of a great multitude of workmen. The shepherd, the sorter of the wool, the wool-comber or carder, the dyer, the scribbler, the spinner, the weaver, the fuller, the dresser, with many others, must all join their different arts in order to complete even this homely production.
How many merchants and carriers, besides, must have been employed in transporting the materials from some of those workmen to others who often live in a very distant part of the country! How much commerce and navigation in particular, how many ship-builders, sailors, sail-makers, rope-makers, must have been employed in order to bring together the different drugs made use of by the dyer, which often come from the remotest corners of the world! What a variety of labour too is necessary in order to produce the tools of the meanest of those workmen! To say nothing of such complicated machines as the ship of the sailor, the mill of the fuller, or even the loom of the weaver, let us consider only what a variety of labour is requisite in order to form that very simple machine, the shears with which the shepherd clips the wool. The miner, the builder of the furnace for smelting the ore, the feller of the timber, the burner of the charcoal to be made use of in the smelting-house, the brick-maker, the brick-layer, the workmen who attend the furnace, the millwright, the forger, the smith, must all of them join their different arts in order to produce them. Were we to examine, in the same manner, all the different parts of his dress and household furniture, the coarse linen shirt which he wears next his skin, the shoes which cover his feet, the bed which he lies on, and all the different parts which compose it, the kitchen-grate at which he prepares his victuals, the coals which he makes use of for that purpose, dug from the bowels of the earth, and brought to him perhaps by a long sea and a long land carriage, all the other utensils of his kitchen, all the furniture of his table, the knives and forks, the earthen or pewter plates upon which he serves up and divides his victuals, the different hands employed in preparing his bread and his beer, the glass window which lets in the heat and the light, and keeps out the wind and the rain, with all the knowledge and art requisite for preparing that beautiful and happy invention, without which these northern parts of the world could scarce have afforded a very comfort- able habitation, together with the tools of all the different workmen employed in producing those different conveniencies; if we examine, I say, all these things, and consider what a variety of labour is employed about each of them, we shall be sensible that without the assistance and co- operation of many thousands, the very meanest person in a civilized country could not be provided, even according to, what we very falsely imagine, the easy and simple manner in which he is commonly accommodated.” (WN I.ii.11)
None of his detracts from Peaucelle’s research into Smith’s sources for pin-making.  
I strongly recommend readers to read Jean-Loius Peaucelle’s latest paper in the current History of Economic Ideas, 2013. vol. xix, no. 3.


Blogger shtove said...

I'm just about to read Wealth of Nations for the first time.

Any tips?

10:24 pm  
Blogger hettygreen said...

I have heard (here I think) that one should read the Theory of Moral Sentiments first - something I was unaware of until after I had read Smith's magnum opus. Anyway I am now about a quarter of the way through Moral Sentiments and so far have not had that 'aha' moment as to the views contained therein. Hopefully the 'plot' thickens or quickens soon...I concede though that I am more a student of history than philosophy and I suppose this is why I find Wealth (at least thus far) comparatively more readable.

4:08 pm  

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