Adam Smith’s Benevolence

Written by natewhit22 on January 28th, 2009

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As I read the Wealth of Nations I discovered something very interesting that I had not realized before. I had always assumed that Adam Smith was a firm believer in self interest and free market, and that those were the sole factors driving his theory about the most effective economic system with which a nation should operate. Throughout his writings though are found various clues as to his compassion toward the well being of others. For example he writes about values such as justice and poverty which at first seem contrary to this.

He writes, “Justice…is the main pillar that upholds the whole edifice. If it is removed, the great, the immense fabric of human society…must in a moment crumble into atoms (10).

He was very sensitive to the issue of poverty. He saw that it at times led nations to adopt inhumane customs and was “unfavorable to the rearing of children.” In certain parts of his native Scotland it was not uncommon for a woman to have 2 children alive out of 20. (97)

I believe that he wanted to help society grow and prosper as a whole and was not solely concerned with acquiring wealth. Even though inequality was bound to come forth through a free market system, he believed that such a system would be the most beneficial for the society as a whole.

Regarding the relationship between price and labor, He, like Locke, believed that labor was the factor that gave a person the right to property. It also determined the value of a certain commodity. The more labor that was giving toward the securing of a good, the more value that a particular good was given. The price of a good was simply determined by the scarcity or plenitude of that resource. The relationship between price and labor is guided by his “invisible hand.” Which he argues will always secure equilibrium in the market so that prices are not too high or too low, but reflect the value of a good or service.

 

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