Without Adam Smith the economic theories of today probably wouldn't exist.One ofthe first capitalist thinkers (and a proponent of laissez-faire methods, at that) his free market ideas laid the framework for production-oriented growth currently dominating Western economies.
The Wealth of Nations appeared at the cusp of the Industrial Revolution. To call it groundbreaking is an understatement—the words capitalism andeconomics weren't in use when it was published in 1776, and parts of Europe were still feudalistic. His ideas about self-regulating price systems, the origins of money, and the real value of a commodity determined the course of policy-making for the next two and a half centuries.
His thoughts on the tension between laborers and employers foreshadowed similar debates between unions and corporate magnates. When workers join together, he said, wages go up; when employers close ranks, wages go down. In Smith's England, anti-union laws were harsh and strict, and his sympathy for disenfranchised workers was severely criticized.
Few books are so significant they continue to inform discussion for centuries;The Wealth of Nations is one. Economics without Adam Smith wouldn't be economics, at least not as we know it. Charlie Darwin did it for science; Thomas Hobbes did it for political science; an eccentric Scottish bachelor who chronically moved in with his mother did it for economics.
Smith's impact wasn't just on mainstream thought. The Austrian School helmed by Ludwig von Mises, with its free market ideals and emphasis on libertarian self-regulation, was directly influenced by Smith's work. Even Karl Marx, whose attitude toward the ideas in The Wealth of Nations was antagonistic, was nevertheless deeply affected by Smith's book.
This is a long book, not to be frivolously undertaken (unless 1200 pages of exceedingly detailed economic philosophy is your idea of fun). One defect for modern readers is that Smith supports many of his ideas with material which is now so antiquated the term "dated" isn't strong enough. Still, the theories remain just as energizing and fascinating, and for anyone wanting to understand the philosophical foundations of capitalism, this is still the best place to start.
Review by C. Hollis Crossman
C. Hollis Crossman used to be a child. Now he's a husband and father who loves church, good food, and weird stuff. He might be a mythical creature, but he's definitely not a centaur. Read more of his reviews here
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