An Inquiry into the Nature and Causes of the Wealth of Nations
Adam Smith
An Inquiry into the Nature and Causes of the Wealth of Nations
ClassicsNonfictionEconomics & Business
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"An Inquiry into the Nature and Causes of the Wealth of Nations" by Adam Smith is a treatise published in 1776. This foundational work of classical economics examines what builds nations' wealth at the dawn of the Industrial Revolution. Smith introduces revolutionary concepts like division of labor, free markets, and the "invisible hand" of self-interest guiding economic activity. Challenging the mercantilist policies of his era, he argues that supply and demand should determine commerce rather than government regulation, establishing theoretical foundations that would shape economic thought for centuries.
Contains spoilers for the entire book
- Themes
- Atmosphere
About the book
Published in 1776, The Wealth of Nations is the Scottish moral philosopher Adam Smith’s inquiry into what makes a country prosperous. It opens with the division of labour, illustrated by a pin factory where specialised workers produce far more together than any could alone, and moves on to money, prices, wages, capital and the growth of trade. Smith argues that national wealth lies in productive labour and goods rather than in hoards of gold, and much of the book is an attack on the mercantile system of tariffs, monopolies and colonial restrictions. It is not a simple hymn to markets: he is wary of merchants who combine against the public, and sets out duties that belong to the state, from defence and justice to public works and education.
Characters
The pin-maker — The division of labour
The workman of Smith’s famous example, who could barely make one pin a day alone, while ten specialists together make thousands.
The butcher, the brewer and the baker — Self-interest
Who provide our dinner not from benevolence but from regard to their own interest, in the book’s best-known image of exchange.
The merchants and manufacturers — The interested party
Whose pursuit of monopolies and protection Smith regards with suspicion, warning that they seldom meet without conspiring against the public.
The mercantile system — The doctrine under attack
The policy of tariffs, bounties and colonial restrictions aimed at piling up gold, which the fourth book takes apart.
Mr. Quesnai — Founder of the agricultural system
The French physician and economist, spelled so here, whose school held land to be the only source of wealth; Smith respects and corrects it.
About the author
Adam Smith (1723–1790) was a Scottish moral philosopher and economist, born in Kirkcaldy, Fife. He studied at the University of Glasgow and at Balliol College, Oxford, and in 1752 became professor of moral philosophy at Glasgow. His first book, The Theory of Moral Sentiments (1759), explained moral judgement through sympathy and the imagined view of an impartial spectator. In the 1760s he travelled in France as tutor to the young Duke of Buccleuch, meeting the economists of the physiocrat school, and then spent years in Kirkcaldy writing An Inquiry into the Nature and Causes of the Wealth of Nations, published in 1776. A close friend of David Hume, he was appointed a commissioner of customs in Edinburgh, where he died in 1790. His work laid the foundations of modern economics.