Adam Smith
Adam Smith (1723–1790) was a Scottish moral philosopher, political economist, and central figure of the Scottish Enlightenment. Educated at Glasgow and Oxford, Smith first achieved fame with "The Theory of Moral Sentiments" (1759), which grounded ethics in sympathy and the standpoint of an "impartial spectator" rather than in divine command or rational intuition alone. As Professor of Moral Philosophy at Glasgow, he developed a comprehensive system encompassing ethics, jurisprudence, and political economy. His magnum opus, "An Inquiry into the Nature and Causes of the Wealth of Nations" (1776), is often regarded as the founding text of classical economics. There he analyzes the division of labor, markets, money, and the role of the state, famously formulating the idea that individuals, seeking their own advantage under appropriate legal and institutional constraints, can unintentionally promote the public good—an image later summarized as the "invisible hand." Yet Smith was not a simple apologist for laissez-faire: he advocated public education, infrastructure, and regulation of monopolies, and he stressed the centrality of justice to social order. Through a unified project linking moral psychology, law, and commerce, Smith helped shape modern understandings of capitalism, the state, and civil society.
At a Glance
- Born
- 1723-06-16 — Kirkcaldy, Fife, Scotland, Kingdom of Great Britain
- Died
- 1790-07-17(approx.) — Edinburgh, Scotland, Kingdom of Great BritainCause: Likely complications from a chronic intestinal illness
- Floruit
- 1748–1789Period of Smith’s main teaching and publishing activity.
- Active In
- Scotland, England, France
- Interests
- Moral philosophyPolitical economyEthicsJurisprudenceSocial philosophyPolitical philosophyHistory of economic institutionsRhetoric and belles lettres
Human society is best understood as an interlocking system of moral sentiments, legal institutions, and economic practices in which individuals, guided by sympathy, habits of impartial judgment, and self-interest constrained by justice and the rule of law, can generate social order and prosperity—so long as political and legal frameworks channel their motives toward the public good rather than privilege, monopoly, or domination.
The Theory of Moral Sentiments
Composed: c. 1749–1759 (6th ed. revised 1789–1790)
An Inquiry into the Nature and Causes of the Wealth of Nations
Composed: c. 1764–1776
Lectures on Jurisprudence
Composed: Delivered 1762–1764; reconstructed from student notes
Lectures on Rhetoric and Belles Lettres
Composed: Delivered late 1740s–1750s; text from 1762–1763 notes
Essays on Philosophical Subjects
Composed: Various essays composed c. 1740s–1780s; posthumously collected 1795
The History of Astronomy
Composed: Begun c. 1740s, revised intermittently; published posthumously 1795
How selfish soever man may be supposed, there are evidently some principles in his nature, which interest him in the fortune of others, and render their happiness necessary to him, though he derives nothing from it, except the pleasure of seeing it.— Adam Smith, The Theory of Moral Sentiments, Part I, Section I, Chapter I
Opening statement of his moral philosophy, asserting that human beings possess inherent sympathetic dispositions that ground morality.
By directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention.— Adam Smith, An Inquiry into the Nature and Causes of the Wealth of Nations, Book IV, Chapter II
Canonical formulation of the "invisible hand" image, used to illustrate how self-interested actions can unintentionally advance the public interest in a competitive market under suitable institutions.
No society can surely be flourishing and happy, of which the far greater part of the members are poor and miserable.— Adam Smith, An Inquiry into the Nature and Causes of the Wealth of Nations, Book I, Chapter VIII
Statement emphasizing that the health of a commercial nation depends on the well-being of the majority, not merely the wealth of elites.
Beneficence is always free, it cannot be extorted by force; the mere want of it exposes to no punishment; because the mere want of beneficence tends to do no real positive evil. It may disappoint of the good which might reasonably have been expected, and upon that account it may justly excite dislike and disapprobation; but it cannot provoke any resentment which mankind will approve of.— Adam Smith, The Theory of Moral Sentiments, Part II, Section II, Chapter I
Clarifies the distinction between enforceable duties of justice and non-enforceable virtues of beneficence within his theory of moral obligation and law.
Little else is requisite to carry a state to the highest degree of opulence from the lowest barbarism but peace, easy taxes, and a tolerable administration of justice.— Attributed to Adam Smith; cf. early nineteenth-century recollections in Dugald Stewart, "Account of the Life and Writings of Adam Smith"
A frequently cited summary of Smith’s view on the limited but crucial conditions government must secure for widespread economic improvement, though preserved in later reports rather than his own published works.
Formative Years and Education (1723–1751)
Raised by his widowed mother in Kirkcaldy, Smith displayed early intellectual promise. At Glasgow he absorbed Francis Hutcheson’s moral sense philosophy and Whig politics, and at Oxford he deepened his engagement with classical learning, British empiricism, and Newtonian science, while becoming critical of scholastic pedagogy.
Glasgow Professorship and Moral Philosophy (1751–1764)
As Professor of Logic and then Moral Philosophy at Glasgow, Smith delivered influential lectures on ethics, jurisprudence, political economy, and rhetoric. This period culminated in "The Theory of Moral Sentiments," where he articulated a sophisticated account of sympathy, the impartial spectator, and the virtues underpinning commercial society.
Continental Travels and Economic Theory (1764–1776)
Serving as tutor to the Duke of Buccleuch, Smith traveled in France and Switzerland, encountering the physiocrats and conversing with leading philosophes. These encounters, together with his long-standing interest in law and history, informed his rethinking of trade, taxation, and state functions, feeding directly into "The Wealth of Nations."
Mature Reflection, Public Service, and Revisions (1776–1790)
After publishing "The Wealth of Nations," Smith became Commissioner of Customs in Scotland, giving him practical experience with fiscal and commercial regulation. In his final years in Edinburgh he revised his works, particularly the sixth edition of "The Theory of Moral Sentiments," and destroyed many manuscripts, leaving only fragments of his intended system.
1. Introduction
Adam Smith (1723–1790) is widely regarded as a foundational figure of modern social science, best known for combining moral philosophy, jurisprudence, and political economy into a unified account of commercial society. Working within the Scottish Enlightenment, he sought to explain how large, impersonal societies could maintain moral norms, legal order, and material prosperity without relying solely on centralized command or traditional hierarchies.
His two major books—The Theory of Moral Sentiments (1759) and An Inquiry into the Nature and Causes of the Wealth of Nations (1776)—are often read separately, but many scholars emphasize their systematic connection. On this view, Smith’s analysis of sympathy, the impartial spectator, and the virtues provides the ethical-psychological foundations for his later account of markets, division of labor, and the system of natural liberty. Others interpret the works as reflecting tensions or shifts in his thinking about self-interest, virtue, and social order.
Smith’s thought is central to the development of classical political economy, but it also ranges beyond economics in the modern sense. He analyzes the historical evolution of law, property, and political institutions; the social conditions of commercial society; the nature of scientific explanation; and the role of rhetoric in shaping belief. His famous image of the “invisible hand” has become emblematic of ideas about spontaneous order, yet its meaning and scope remain contested.
The following sections treat, in turn, Smith’s life and historical milieu, the formation of his ideas, the content of his major works, and the main themes of his philosophical system, before considering subsequent interpretations, criticisms, and the long-term impact of his work.
2. Life and Historical Context
2.1 Biographical outline
Smith was born in 1723 in Kirkcaldy, a small but commercially active Fife port, to a widowed mother from a modest gentry family. Educated first at the University of Glasgow under Francis Hutcheson and later at Oxford, he returned to Scotland to give public lectures in Edinburgh before becoming Professor of Logic, then Moral Philosophy, at Glasgow (1751–1764). His Glasgow period saw the gestation of The Theory of Moral Sentiments. After resigning his chair to tutor the young Duke of Buccleuch, he spent two years on the Continent, then lived largely in Kirkcaldy while composing The Wealth of Nations. From 1778 until his death in 1790 he served as Commissioner of Customs in Edinburgh.
| Year | Life event | Contextual significance |
|---|---|---|
| 1723 | Born in Kirkcaldy | Growing North Sea trade, Union of 1707 reshaping Scottish economy |
| 1751–1764 | Glasgow professorship | High point of Scottish Enlightenment institutional life |
| 1759 | Theory of Moral Sentiments | Moral philosophy within a commercializing Britain |
| 1776 | Wealth of Nations | Published amid American Revolution and debates on empire |
| 1778–1790 | Customs Commissioner | Direct involvement in fiscal administration and trade regulation |
2.2 Scottish Enlightenment milieu
Smith’s career unfolded within the Scottish Enlightenment, a network of thinkers including David Hume, Francis Hutcheson, Adam Ferguson, and Dugald Stewart. Universities, clubs, and learned societies in Glasgow and Edinburgh fostered interdisciplinary inquiry into moral philosophy, history, political economy, and science. Proponents see Smith as typical of this milieu in his empiricism, interest in social progress, and use of “conjectural history” to explain institutional development.
2.3 British and European transformations
Smith wrote during a period of expanding commercial and imperial power for Britain, marked by Atlantic trade, colonial rivalries, and frequent war with France. The fiscal-military state, debates over mercantilist policy, and social changes associated with early industrialization formed the backdrop to his analysis of taxation, trade, and labor. His Continental travels connected him with French physiocrats and other philosophes, situating his work within broader European debates on natural liberty, reason, and the reform of institutions.
Historians differ on how tightly Smith’s arguments are tied to these specific 18th-century circumstances. Some emphasize their rootedness in British imperial and class structures; others highlight their more general ambitions as contributions to a science of man and society.
3. Early Years, Education, and Influences
3.1 Kirkcaldy and early formation
Smith grew up in Kirkcaldy, a modest port town whose trading activity exposed him to the everyday realities of commerce and small-scale manufacture. Biographers often suggest that this environment contributed to his later interest in markets and the lives of ordinary workers, though such causal links remain speculative. Raised primarily by his mother, Margaret Douglas, he developed a close lifelong attachment to her, which some interpreters see as relevant to his sensitivity to interpersonal affection and dependence in The Theory of Moral Sentiments.
3.2 Glasgow and Francis Hutcheson
At age fourteen Smith entered the University of Glasgow, studying under Francis Hutcheson, then a leading moral philosopher. Hutcheson’s moral sense theory, emphasis on benevolence, and Whiggish, anti-authoritarian politics greatly influenced Smith’s early outlook. Smith appears to adopt, yet also revise, Hutcheson’s idea that humans possess an innate capacity to approve of virtue, replacing a simple “moral sense” with a more complex mechanism of sympathy and the impartial spectator.
Glasgow also exposed Smith to Newtonian science, Presbyterian reformism, and a curriculum that linked philosophy to law and public affairs. Scholars frequently identify this period as decisive in shaping his methodological preference for systematic yet empirically informed explanation.
3.3 Oxford and intellectual independence
In 1740 Smith went to Balliol College, Oxford on a Snell Exhibition. He later portrayed Oxford’s teaching as stagnant and scholastic, contrasting it unfavorably with Glasgow. While some historians think his criticisms are somewhat exaggerated, there is broad agreement that his Oxford years encouraged autodidactic study of classical literature, modern philosophy (including Hume), and natural science.
The relative intellectual isolation may have reinforced Smith’s skepticism toward monopolized, unreformed institutions, a theme he later applied to universities, corporations, and guilds in The Wealth of Nations.
3.4 Early intellectual circle and Hume
After leaving Oxford, Smith’s public lectures in Edinburgh brought him into close contact with David Hume and other literati. Hume’s empiricism, naturalistic account of morals, and history-writing deeply affected Smith. Scholars disagree over how far Smith follows Hume on issues such as egoism, skepticism, or religion; some emphasize continuity, others highlight Smith’s stronger confidence in social order, virtue, and “propriety.”
These early influences—Hutcheson’s benevolence, Newtonian science, Humean naturalism, and the Scottish civic tradition—provided the main resources from which Smith developed his own system.
4. Glasgow Professorship and Public Lectures
4.1 Edinburgh lectures and early public role
Before his Glasgow appointment, Smith delivered public lectures in Edinburgh (from 1748) on rhetoric, belles lettres, and jurisprudence. These fee-paying lectures attracted lawyers, clergy, and literati, integrating him into the city’s intellectual networks. Surviving notes suggest he already explored themes later central to his mature works: the historical evolution of institutions, the psychology of persuasion, and the links between law, morals, and commerce.
4.2 Chair of Logic and Moral Philosophy at Glasgow
In 1751 Smith was appointed Professor of Logic at Glasgow; in 1752 he transferred to the more prestigious Chair of Moral Philosophy. His teaching there, typically over a four-year cycle, encompassed natural theology, ethics, jurisprudence, and political economy. Contemporary testimonies portray him as an engaged, systematic lecturer rather than a polished orator.
The Glasgow period is widely regarded as the crucible in which he forged the doctrines later presented in The Theory of Moral Sentiments and The Wealth of Nations. Student notes from this time are a major source for reconstructing his views on law and economics prior to publication.
4.3 Lectures on jurisprudence and political economy
Smith’s Lectures on Jurisprudence (reconstructed from student notes) reveal a four-stage “conjectural history” of society—hunters, shepherds, farmers, and commercial peoples—used to explain the emergence of property, government, and law. He analyzed police (in the older sense of economic policy and public order), revenue, and arms, elaborating on taxation, public works, and regulation.
These lectures show him working through many arguments later refined in The Wealth of Nations: critiques of mercantilism, support for freer trade, and analysis of division of labor. They also stress the centrality of justice and security of property as preconditions for economic development.
4.4 Rhetoric, belles lettres, and pedagogy
The surviving Lectures on Rhetoric and Belles Lettres indicate Smith’s concern with clarity, order, and the psychological effects of style on audiences. He discussed how metaphor, narrative, and systematic exposition help convey complex ideas—a perspective that informs his own writing strategies.
Historians differ on how unified these teaching activities were. Some see a coherent “science of man” spanning ethics, law, and economics; others detect unresolved tensions between the theological, civic, and commercial strands of his Glasgow thought.
5. Continental Travels and Engagement with the Physiocrats
5.1 Tutorship and itinerary
In 1764 Smith resigned his Glasgow chair to become tutor to Henry Scott, Duke of Buccleuch. This position enabled extensive travel in France and Switzerland (1764–1766). He resided for extended periods in Toulouse and Paris, with visits to Geneva and other centers. The tour provided leisure for reflection and exposure to Continental debates on political economy and reform.
5.2 Encounters with the physiocrats
While in France Smith met leading physiocrats—notably François Quesnay, Anne-Robert-Jacques Turgot, and Victor de Mirabeau—as well as other philosophes. The physiocrats argued that agriculture was the sole “productive” sector and advocated a single tax on land and extensive economic freedom. Smith admired their systematic ambition and their critique of mercantilist restrictions, often referring to them as “the economists.”
Interpretations diverge on the extent of their influence. Some scholars claim that Smith’s emphasis on the net product of land, his sympathy for free trade, and his notion of “natural order” bear physiocratic marks. Others stress his departures: he rejected the view that only agriculture produces surplus and reallocated productivity across manufacturing and commerce.
5.3 Wider French Enlightenment influences
Beyond physiocracy, Smith engaged with French Enlightenment social theory and salon culture. Conversations with figures like D’Alembert, Helvétius, and perhaps Condorcet enriched his awareness of debates on tolerance, education, and public opinion. This experience likely reinforced his comparative, cross-national approach to institutions visible in both his jurisprudential and economic analyses.
5.4 Transition to The Wealth of Nations
After returning to Britain in 1766, Smith spent most of a decade in Kirkcaldy composing The Wealth of Nations. Many commentators see the Continental experience as pivotal in sharpening his critique of British commercial policy and colonialism, as he contrasted English practices with French and other European systems. Others caution against overstating this role, noting that core ideas about division of labor, natural liberty, and the functions of the state already appeared in his Glasgow lectures.
6. Major Works: The Theory of Moral Sentiments
6.1 Publication and structure
Published in 1759, The Theory of Moral Sentiments (TMS) established Smith’s reputation as a moral philosopher. It underwent multiple editions, culminating in a substantially revised sixth edition in 1790. The work is organized into parts dealing with propriety, merit, duty, character of virtue, and, in the final edition, an extended discussion of moral psychology and the system of the universe.
6.2 Sympathy and moral judgment
At its core, TMS proposes sympathy—our imaginative capacity to share others’ feelings—as the basis of moral evaluation. Humans, Smith argues, naturally seek mutual sympathy of sentiments and judge actions by asking whether an impartial, well-informed spectator could “go along with” the agent’s feelings and motives.
“We suppose ourselves the spectators of our own behaviour, and endeavour to imagine what effect it would, in this light, produce upon us.”
— Adam Smith, The Theory of Moral Sentiments, Part III, ch. 1
6.3 The impartial spectator and conscience
The work develops the notion of an impartial spectator, an internalized, imagined observer whose standpoint we adopt to assess conduct—our own and others’. This figure underpins Smith’s account of conscience, praise and blame, and the distinction between real and merely perceived merit. Some interpreters understand the spectator as a psychological construct; others see it as embedding a more objective, perhaps theistic, moral order.
6.4 Justice, beneficence, and virtue
TMS distinguishes justice, which prohibits harm and may be coercively enforced, from beneficence, which concerns positive acts of kindness and cannot be rightfully compelled. Smith also discusses higher virtues, including prudence, benevolence, and self-command, and considers how commercial society shapes and sometimes distorts character.
6.5 Revisions and debates
The 1790 edition adds material on self-deception, religion, and the “love of system,” prompting debate about whether Smith’s views shifted over time. Some scholars emphasize continuity, reading the revisions as clarifications. Others argue they register a stronger concern with divine providence, philosophical skepticism, or the moral dangers of political enthusiasm.
The precise relationship between TMS and The Wealth of Nations—whether harmonious, complementary, or tension-ridden—is a central issue in Smith scholarship, treated more fully in later sections.
7. Major Works: The Wealth of Nations
7.1 Publication and scope
An Inquiry into the Nature and Causes of the Wealth of Nations (1776) is Smith’s most famous work and a foundational text of classical political economy. Comprising five books, it addresses the division of labor, price and value, capital accumulation, systems of political economy (especially mercantilism and physiocracy), and public finance.
7.2 Division of labor and productivity
Book I opens with the analysis of division of labor, illustrated by the famous pin factory example. Smith argues that specialization increases productivity by enhancing dexterity, saving time, and encouraging invention. This accounts for much of the “wealth of nations”—their capacity to command labor and commodities.
“The greatest improvements in the productive powers of labour… seem to have been the effects of the division of labour.”
— Adam Smith, The Wealth of Nations, Book I, ch. 1
7.3 Value, prices, and distribution
Smith distinguishes “natural price” (long-run cost of production, including wages, profit, and rent) from “market price”, which fluctuates with supply and demand. He explores how the social product is distributed among workers, capitalists, and landowners, and how institutional arrangements and bargaining power affect wages and profits. Later classical economists systematized and sometimes altered his views, leading to debates about the internal consistency of his value theory.
7.4 Trade, mercantilism, and natural liberty
Books IV and V critique mercantilist policies—protective tariffs, colonial monopolies, and restrictions on trade—as distortions that benefit particular interests at the expense of general prosperity. Smith defends a “system of natural liberty” in which individuals are generally free to pursue economic activities within a framework of justice and predictable law.
The celebrated “invisible hand” passage appears in this context as an illustration of unintended social coordination under appropriate institutions. Interpretations differ on how central this metaphor is to his overall theory and on how broad its application should be.
7.5 Public finance and state functions
Book V analyzes taxation, public debt, and public works, arguing for a limited but significant role for government in providing defense, justice, certain infrastructure, and aspects of education and regulation. Smith assesses different tax bases and administrative arrangements with attention to efficiency, equity, and incentives.
Scholars dispute whether The Wealth of Nations is best read as a blueprint for laissez-faire, a historically specific reform program for 18th‑century Britain, or a more general theory of market societies bound by legal and moral constraints.
8. Moral Psychology and the Impartial Spectator
8.1 Sympathy as a mechanism of understanding
Smith’s moral psychology centers on sympathy, by which individuals imaginatively project themselves into others’ situations and “fellow-feel” their emotions. Sympathy is not limited to benevolent concern; it includes sharing resentment, grief, joy, and even self-directed emotions when one reflects upon oneself as another would.
This mechanism explains how people in large, impersonal societies form shared norms without explicit agreement. By continually adjusting their sentiments to what they expect others can “enter into,” individuals converge on standards of propriety.
8.2 Construction of the impartial spectator
Through repeated social interaction, Smith argues, agents internalize others’ judgments and form an “impartial spectator” within their own breast. This figure provides a standpoint from which to evaluate motives and actions:
- It is impartial, abstracting from personal bias and private interest.
- It is well-informed, considering all relevant circumstances.
- It yields feelings of self-approbation or remorse depending on whether we can “go along” with our own conduct when viewed from this perspective.
Some scholars interpret the impartial spectator as a purely psychological product of socialization; others attribute to it a quasi-objective status, linking it to natural or even divine standards of right.
8.3 Self-command, passion, and character
Smith emphasizes self-command: the ability to regulate one’s passions in line with what the impartial spectator would endorse. Virtues such as prudence, temperance, and fortitude emerge from this discipline. The desire for praise-worthiness rather than mere praise leads individuals to align their conduct with internalized standards rather than external flattery.
Debate persists over whether Smith’s psychology is fundamentally egoistic—resting on the desire for approbation—or whether sympathy and concern for others’ happiness are genuinely other-regarding. Many interpreters see a complex blend, where self-love is moderated and redirected by imaginative identification with others.
8.4 Social order and moral disagreement
Smith’s model portrays moral norms as arising from many local interactions, yet he also allows for partiality, fashion, and corruption of judgment, particularly where power differentials distort spectators’ sentiments. This has led some commentators to emphasize the critical, reformist potential of the impartial spectator, while others stress its conservative tendency to endorse prevailing conventions.
9. Political Economy, Markets, and the Division of Labor
9.1 Markets as systems of coordination
In The Wealth of Nations and his jurisprudential lectures, Smith presents markets as mechanisms that coordinate dispersed knowledge and labor through prices and self-interested exchange. Individuals specialize in tasks and trade outputs, relying on a network of contracts and expectations rather than personal charity:
“It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner…”
— Adam Smith, The Wealth of Nations, Book I, ch. 2
This line has been interpreted variously as a narrow endorsement of self-interest or as a limited point about everyday transactional motives within a broader moral framework.
9.2 Division of labor and its ambivalence
Smith’s analysis of division of labor attributes enormous gains in productivity to specialization. He links the extent of specialization to the extent of the market, suggesting that larger markets enable more refined division of tasks and thus higher productivity.
At the same time, he notes potential drawbacks: repetitive, narrow tasks may render workers “as stupid and ignorant as it is possible for a human creature to become” if not offset by education and civic institutions. Some scholars stress this as evidence of Smith’s awareness of alienation-like phenomena; others regard it as a more limited educational concern.
9.3 Natural price, competition, and regulation
Smith’s political economy distinguishes natural from market prices and depicts competition as a tendency for market prices to gravitate toward natural prices, aligning supply and demand. However, he emphasizes that monopolies, corporate privileges, and trade restrictions can disrupt this process.
His critiques of guilds, exclusive trading companies, and state-granted monopolies have often been cited as foundational arguments for competition policy. Interpretations differ on how far Smith believed real-world markets approximate the competitive ideal, and what degree of legal and regulatory intervention he envisaged to prevent collusion and market power.
9.4 International trade and growth
Smith defends free trade relative to mercantilist systems, arguing that removing barriers allows each country to specialize according to its advantages, thereby increasing global wealth. He contrasts the “jealousy of trade” with the mutual benefits of open commerce.
Yet he also grants exceptions—for defense industries, gradual liberalization, or retaliatory tariffs—leading to debates over whether his trade theory is principled or predominantly pragmatic. His account of capital accumulation, profits, and wages underpins a broader theory of economic growth that later classical economists elaborated and contested.
10. Justice, Law, and the Role of the State
10.1 Justice as the foundation of social order
For Smith, justice—understood primarily as the prohibition of harm to person, property, and reputation—is the indispensable basis of social stability. Unlike beneficence, which is voluntary, justice may be enforced by coercive laws and sanctions. Without an effective system of justice, he maintains, neither commerce nor civil society can flourish.
10.2 Natural jurisprudence and stages of society
In his Lectures on Jurisprudence, Smith adopts a “conjectural history” tracing the evolution of law through stages: hunting, shepherding, agriculture, and commercial society. Different forms of property, family structures, and political authority emerge at each stage. This framework, shared with other Scottish Enlightenment thinkers, situates legal norms within broader patterns of economic and social development.
10.3 Functions of the state
In The Wealth of Nations, Smith attributes three main duties to government:
| Duty | Content (Smith’s characterization) |
|---|---|
| Defense | Protecting society from external aggression |
| Justice | Protecting individuals from injustice or oppression by others |
| Public works and institutions | Providing certain public goods (roads, bridges, education) not profitable for private enterprise |
He further analyzes taxation, favoring taxes that are proportionate, certain, convenient, and economical to collect. His critical discussions of public debt and colonial administration reflect concern with fiscal sustainability and fair burden-sharing.
10.4 Law, regulation, and “system of natural liberty”
Although often associated with laissez-faire, Smith supports a rule-based legal framework that includes regulation of banking, joint-stock companies, and public infrastructure. He also advocates compulsory elementary education and sometimes endorses temporary restraints on trade. Scholars disagree on how expansive his conception of legitimate state intervention is: some see a relatively narrow night-watchman state; others emphasize a richer program of institutional design and public goods provision.
10.5 Justice, punishment, and moral sentiments
Smith ties legal institutions to his moral psychology. Punishment is justified not solely by deterrence or retribution but by spectators’ sympathetic resentment toward injustice. However, he acknowledges the risk that class prejudice and partiality can distort legal judgment, prompting different readings of his stance toward existing legal systems—either as broadly endorsing them with reforms, or as quietly critical of entrenched privilege.
11. Ethics, Virtue, and Commercial Society
11.1 Virtue ethics in a commercial age
In The Theory of Moral Sentiments, Smith develops a virtue-ethical outlook centered on prudence, justice, beneficence, and self-command. Commercial society, characterized by market exchange and social mobility, offers new opportunities for prudential self-betterment but also fosters envy, vanity, and “corruption of moral sentiments” through excessive admiration of wealth and power.
11.2 The “prudent man” and the “man of system”
Smith’s often-cited figure of the “prudent man” combines self-interest with foresight, moderation, and regard for others’ expectations, contrasting with the “prodigal” or “projector” who speculates recklessly. Another key figure is the “man of system”, the political actor who seeks to rearrange society according to an abstract plan, disregarding the independent principles of other agents. These contrasts articulate different ethical stances within commercial society.
11.3 Commercial society’s moral effects
Smith’s assessment of commercial society is ambivalent. On one hand, he credits it with fostering industry, punctuality, honesty in transactions, and a degree of equality based on mutual dependence. On the other, he warns that intense competition for status may distort moral judgment, leading people to overvalue the rich and powerful and undervalue the poor and virtuous.
Interpreters disagree on whether Smith is fundamentally optimistic or critical about capitalist culture. Some read him as celebrating the civilizing effects of markets; others stress his concern about spiritual and civic degradation.
11.4 Charity, beneficence, and social responsibility
While denying that beneficence can be coerced, Smith insists it is essential to a flourishing society. He praises voluntary charity, friendship, and familial affection, and describes how sympathetic concern for the poor and distressed is reinforced by moral education and religious belief. Scholars debate whether his reliance on voluntary beneficence, combined with justice and market processes, amounts to an adequate vision of social welfare or leaves significant moral gaps.
11.5 Gender, family, and domestic virtues
Smith occasionally discusses domestic affections, including parental and filial love, as central to moral development. However, he offers little systematic treatment of gender roles. Recent feminist and historical readings explore how his framework might apply to women’s work and family life in commercial society, with some arguing that his account implicitly presupposes male economic citizenship, while others highlight resources for a more inclusive ethics.
12. Metaphysics, Science, and the History of Astronomy
12.1 Naturalism and the “science of man”
Smith is often classified as a naturalist rather than a metaphysician in the traditional sense. He tends to explain moral norms, legal institutions, and economic behavior through observable psychological and social mechanisms rather than appeal to innate ideas or strong theological premises. Nonetheless, he occasionally invokes a “Author of Nature” and speaks of a “benevolent” order, especially in later editions of TMS, leading to debate over the depth of his theism.
12.2 The History of Astronomy and scientific explanation
Smith’s posthumously published History of Astronomy traces how humans construct “systems” to explain irregular natural phenomena. He argues that scientific theories aim to satisfy the mind’s desire for order and “connecting principles”, turning wonder and surprise into tranquil understanding.
“Philosophy is the science of the connecting principles of nature.”
— Adam Smith, History of Astronomy, Section II
Smith examines ancient cosmologies and the shift from Ptolemaic to Newtonian astronomy, offering one of the earliest historical-philosophical accounts of scientific change.
12.3 The “love of system” and its ambiguities
The notion of a human “love of system” appears in both the History of Astronomy and TMS. In science, it motivates the search for unified theories; in morals and politics, it can inspire both prudent institutional reform and dangerous utopian schemes. This ambivalence underlies Smith’s suspicion of the “man of system,” who treats society like a chessboard.
12.4 Metaphysical debates
Scholars disagree on Smith’s underlying metaphysics:
| Interpretation | Main claim |
|---|---|
| Theistic-providential | Smith presupposes a providential order guiding moral sentiments and social harmony. |
| Secular naturalist | References to providence are rhetorical; his explanations rely on human psychology and social dynamics. |
| Moderate skeptic | Smith remains agnostic, emphasizing the limits of human knowledge and focusing on practical norms. |
The History of Astronomy and related essays are central evidence in these debates, as they illustrate his approach to causation, explanation, and the status of scientific “systems” without fully committing to a metaphysical doctrine beyond empirical regularities.
13. Epistemology and Rhetoric
13.1 Knowledge as systematized experience
Smith does not present a formal epistemology, but his writings imply a view of knowledge as the ordering of experience into coherent systems. Influenced by Newtonian science and Humean empiricism, he treats theories as hypothetical constructs that organize phenomena, reduce surprise, and allow reliable expectations.
This perspective appears in both History of Astronomy and his moral theory, where the mind seeks general rules of conduct derived from repeated sympathetic interactions and reflective judgment.
13.2 General rules and moral knowledge
In TMS, Smith describes how repeated experiences of approval and disapproval lead to “general rules” of morality. These rules are fallible and revisable, yet provide epistemic stability for everyday judgment. They are justified not by pure reason alone but by the convergence of sympathetic feelings as corrected by the impartial spectator.
Some commentators see this as an early form of reflective equilibrium between intuitions and principles; others emphasize its sociological dimension, stressing how conventions and power shape which rules become authoritative.
13.3 Rhetoric, persuasion, and belief
Smith’s Lectures on Rhetoric and Belles Lettres show his conviction that knowledge is inseparable from communication. He treats rhetoric not merely as ornament but as the art of making ideas clear, orderly, and persuasive to an audience. He analyzes tropes such as metaphor and narrative in terms of their cognitive effects—how they help listeners grasp unfamiliar concepts by relating them to familiar experiences.
Smith also distinguishes didactic, demonstrative, and narrative styles, evaluating authors (including Hume and Locke) on their success in guiding readers’ attention. Scholars have noted that The Wealth of Nations itself employs narrative case studies and vivid images (like the pin factory and the invisible hand) in line with these rhetorical principles.
13.4 Epistemic virtues and limits
Implicitly, Smith commends intellectual virtues such as modesty, careful observation, and resistance to enthusiasm. He warns that the “love of system” can lead to overconfidence in theories, particularly in politics. This has been read as an early articulation of a fallibilist stance: humans can achieve useful, probabilistic knowledge but should remain aware of its provisional, perspective-bound character.
14. Misconceptions, Critiques, and Debates
14.1 Alleged “economic man” and narrow self-interest
A common misconception portrays Smith as endorsing a purely self-interested “homo economicus.” Critics point to selective quotations about self-love and market exchange. Many scholars counter that TMS clearly attributes strong sympathetic and other-regarding motives to humans, suggesting that Smith used self-interest as a simplifying assumption in specific economic contexts rather than as a comprehensive anthropology. Debate continues over how to reconcile these strands and whether modern economics has selectively appropriated his ideas.
14.2 The “Adam Smith problem”
Nineteenth-century German scholars coined the “Adam Smith problem”: an alleged inconsistency between the sympathy-based ethics of TMS and the self-interest-driven economics of The Wealth of Nations. Contemporary scholarship largely regards this as overstated, emphasizing thematic continuities and the different explanatory purposes of each work. However, some interpreters still see genuine tensions between Smith’s normative commitments and his analysis of market behavior.
14.3 Critiques from political economy and Marxism
Later political economists and Marxist critics have challenged Smith’s labor theory elements, his treatment of profit and wages, and his assumptions about the harmony of interests. Marx credited Smith for insights into labor and value but argued that he naturalized historically specific capitalist relations and underestimated exploitation and class conflict. Others fault his reliance on competitive markets as unrealistic or insufficiently attentive to structural inequality.
14.4 Feminist and postcolonial critiques
Feminist scholars have noted Smith’s limited attention to unpaid domestic labor, gendered divisions of work, and the political status of women, asking how his framework might accommodate or obscure these aspects of commercial society. Postcolonial critics highlight his discussions of “savage” and “civilized” nations and empire, arguing that his stadial theory can reinforce Eurocentric hierarchies, even as he criticizes specific colonial practices.
14.5 Religious and communitarian objections
Religious critics historically objected to Smith’s naturalistic explanations of morality and his apparent marginalization of theological virtues. Communitarian thinkers have more recently questioned whether his emphasis on markets and justice undermines thick communal ties, civic engagement, or shared conceptions of the good. Defenders respond by pointing to his stress on sympathy, friendship, and local associations.
14.6 Ongoing interpretive disputes
Significant debates persist about:
| Issue | Main questions |
|---|---|
| Unity of his system | Are TMS and Wealth fully integrated, partially compatible, or in tension? |
| Extent of laissez-faire | How far did he support state intervention beyond justice and defense? |
| Theism vs. secularism | Are references to providence substantive or mainly rhetorical? |
| Normative status | Is Smith primarily a descriptive analyst of commercial society or a prescriptive theorist of liberal order? |
These debates shape contemporary appropriations of Smith in economics, philosophy, political theory, and intellectual history.
15. Legacy and Historical Significance
15.1 Founding figure of classical political economy
Smith’s Wealth of Nations is widely regarded as inaugurating classical political economy, influencing thinkers such as David Ricardo, Thomas Malthus, and John Stuart Mill. His concepts of division of labor, natural price, and capital accumulation became central to 19th‑century economic analysis, even as successors modified or critiqued his views.
15.2 Place in moral and political philosophy
In moral philosophy, Smith’s account of sympathy and the impartial spectator has informed later work in virtue ethics, moral psychology, and sentimentalist traditions. Contemporary theorists in ethics and political philosophy draw on him to explore issues of justice, moral development, and the relationship between markets and character. His differentiation between justice and beneficence remains a reference point in debates about enforceable rights versus voluntary virtues.
15.3 Influence on liberal and economic thought
Smith is frequently invoked as an intellectual ancestor of economic liberalism and (in some readings) neoliberalism. Advocates cite his criticisms of mercantilism and defense of natural liberty; critics argue that these invocations often oversimplify his nuanced views on state action, education, and regulation. His thought has been appropriated by a range of political currents, from free-market advocates to more interventionist liberals emphasizing his concern for the poor and for institutional design.
15.4 Reception and reinterpretation
Smith’s reputation has undergone several phases:
| Period | Dominant reception |
|---|---|
| Late 18th–early 19th c. | Celebrated as leading authority on trade and finance |
| Mid–late 19th c. | Integrated into classical economics; “Adam Smith problem” raised in Germany |
| 20th c. mid-century | Read mainly as proto-neoclassical economist; moral works less studied |
| Late 20th–21st c. | Renewed interest in TMS, jurisprudence, and rhetoric; multidimensional “Smith renaissance” |
Recent scholarship emphasizes the systemic unity of his work and situates him within a broader “science of man,” expanding his significance beyond economics.
15.5 Interdisciplinary and global impact
Smith’s ideas now inform fields as diverse as law and economics, behavioral economics, institutional economics, political theory, intellectual history, and business ethics. His analyses of trust, incentives, and the moral underpinnings of markets are used to understand contemporary issues such as globalization, inequality, and corporate responsibility.
Globally, Smith is variously commemorated as a champion of free trade, a critic of privilege and monopoly, a theorist of moral sentiments, and a historian of institutions. These multiple legacies reflect both the breadth of his original project and the openness of his work to divergent, and often contested, interpretations.
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@online{philopedia_adam_smith,
title = {Adam Smith},
author = {Philopedia},
year = {2025},
url = {https://philopedia.com/philosophers/adam-smith/},
urldate = {December 10, 2025}
}Note: This entry was last updated on 2025-12-08. For the most current version, always check the online entry.
Study Guide
intermediateThe biography integrates moral philosophy, legal theory, and political economy, assuming some familiarity with Enlightenment thought and basic economics. It is accessible to motivated beginners but is best suited to readers who have some background in philosophy or history and are ready to track arguments across multiple domains.
- Basic early modern European history (17th–18th centuries) — Smith’s life and work are embedded in the Scottish Enlightenment, British imperial expansion, and the early stages of industrialization; understanding this context clarifies his concerns about commerce, law, and political reform.
- Introductory ethics and political philosophy — Familiarity with concepts like virtue, justice, and the role of the state helps in grasping Smith’s moral sentimentalism, his distinction between justice and beneficence, and his views on government.
- Basic economic ideas (markets, prices, trade, labor) — Smith’s analysis of division of labor, prices, and trade presupposes some understanding of how markets function, making his arguments in The Wealth of Nations easier to follow.
- Foundations of the Enlightenment (reason, science, progress) — Knowing the general intellectual climate—emphasis on reason, natural science, and progress—helps explain Smith’s ‘science of man’ approach and his naturalistic style of explanation.
- David Hume — Hume was Smith’s close friend and a major influence on his empiricism, moral psychology, and naturalistic approach; understanding Hume clarifies both continuities and differences between their views.
- The Scottish Enlightenment — Situates Smith among contemporaries like Hutcheson and Ferguson and explains the institutional and intellectual setting of his work at Glasgow and Edinburgh.
- Physiocracy and the French Économistes — Smith’s engagement with Quesnay, Turgot, and other physiocrats is crucial for understanding his critique of mercantilism and his modified support for economic liberalization.
- 1
Get an overview of Smith’s life, major works, and overall project.
Resource: Sections 1 (Introduction) and 2 (Life and Historical Context)
⏱ 30–40 minutes
- 2
Understand Smith’s formation and the institutions that shaped his teaching and early ideas.
Resource: Sections 3 (Early Years, Education, and Influences) and 4 (Glasgow Professorship and Public Lectures)
⏱ 40–60 minutes
- 3
Study his two major books in turn, focusing on how moral philosophy and political economy connect.
Resource: Sections 5 (Continental Travels and Engagement with the Physiocrats), 6 (Major Works: The Theory of Moral Sentiments), and 7 (Major Works: The Wealth of Nations)
⏱ 60–90 minutes
- 4
Dig into core thematic pillars of his system: moral psychology, markets, justice, and virtue in commercial society.
Resource: Sections 8 (Moral Psychology and the Impartial Spectator), 9 (Political Economy, Markets, and the Division of Labor), 10 (Justice, Law, and the Role of the State), and 11 (Ethics, Virtue, and Commercial Society)
⏱ 90–120 minutes
- 5
Explore Smith’s views on science, explanation, knowledge, and rhetoric to appreciate his broader ‘science of man’.
Resource: Sections 12 (Metaphysics, Science, and the History of Astronomy) and 13 (Epistemology and Rhetoric)
⏱ 60 minutes
- 6
Consolidate understanding by examining controversies, critiques, and Smith’s long-term influence.
Resource: Sections 14 (Misconceptions, Critiques, and Debates) and 15 (Legacy and Historical Significance)
⏱ 45–60 minutes
Moral sentiments
For Smith, the complex set of emotions—such as sympathy, gratitude, resentment, approval, and disapproval—through which we judge our own and others’ conduct and form moral standards.
Why essential: The biography repeatedly emphasizes that Smith’s entire social theory rests on a moral-psychological foundation; understanding moral sentiments is crucial for seeing how his ethics underpins his political economy.
Sympathy
Smith’s key psychological mechanism by which we imaginatively enter into others’ situations and share their feelings, enabling moral judgment and social cohesion in large, impersonal societies.
Why essential: Sympathy explains how common norms can emerge without centralized authority; it is the starting point for the impartial spectator and for his account of virtue and justice.
Impartial spectator
An internalized, imagined observer whose unbiased standpoint we adopt when assessing our own and others’ actions, forming the basis of conscience, self-command, and the distinction between real merit and mere approval.
Why essential: This idea connects Smith’s psychology, ethics, jurisprudence, and even his concerns about political ‘men of system’; it is central to debates about whether his morality is subjective, social, or objective.
Invisible hand
Smith’s metaphor for the unintended social coordination by which individuals, pursuing their own interests within an appropriate legal and institutional framework, can promote aggregate welfare.
Why essential: The biography highlights how often this metaphor is misunderstood; grasping its limited, contextual use in The Wealth of Nations is key to avoiding simplistic ‘free market’ readings of Smith.
Division of labor
The process by which production is broken into specialized tasks, raising productivity by increasing dexterity, saving time, and encouraging innovation, while also risking intellectual and moral narrowing for workers.
Why essential: Division of labor is the analytical starting point of The Wealth of Nations and underlies Smith’s account of economic growth, social interdependence, and some moral risks of commercial society.
Justice vs. beneficence
Smith’s distinction between duties of justice—negative duties not to harm others, which may be coercively enforced—and beneficence, which concerns positive generosity and kindness that cannot justly be compelled.
Why essential: This distinction structures his theory of law, punishment, state power, and social welfare; it also underpins his argument that markets require justice but cannot substitute for voluntary virtue.
Commercial society
A form of social order characterized by extensive market exchange, division of labor, and interdependence among strangers, sustained not primarily by kinship but by laws, moral norms, and institutions.
Why essential: Much of the biography explains how Smith sees commercial society’s benefits and dangers; understanding this concept helps tie together his ethics, jurisprudence, and economics as parts of one project.
System of natural liberty
Smith’s expression for an institutional arrangement in which individuals are largely free to choose occupations and trade, constrained by the laws of justice and general rules rather than by privilege, monopoly, or arbitrary interference.
Why essential: This is the normative benchmark for his critiques of mercantilism, guilds, colonial monopolies, and some forms of state planning, and is central to later liberal appropriations of his work.
Adam Smith believed humans are purely self-interested ‘economic men’.
The biography shows that Smith’s Theory of Moral Sentiments gives a rich account of sympathy, benevolence, and other-regarding motives; self-interest plays a role in markets, but it is not his comprehensive view of human nature.
Source of confusion: Selective quoting of lines about the butcher, brewer, and baker and the invisible hand, often detached from his broader moral psychology and from TMS.
The Theory of Moral Sentiments and The Wealth of Nations contradict each other (the ‘Adam Smith problem’).
Current scholarship, reflected in the article, generally sees strong continuities: TMS provides the moral and psychological foundations for Smith’s analysis of commercial society in Wealth of Nations, even if there are tensions and shifts.
Source of confusion: Reading each book in isolation, assuming that a focus on sympathy in one and on self-interest in the other implies a basic inconsistency, and overlooking his broader ‘system of man’ linking morals, law, and economy.
Smith was an advocate of absolute laissez-faire and opposed almost all state intervention.
The biography emphasizes that Smith supported public provision of defense, justice, infrastructure, and certain forms of education and regulation (e.g., banking, monopolies), and even allowed for gradualism and exceptions in trade policy.
Source of confusion: Equating his critique of mercantilism and corporate privilege with a blanket rejection of all government action in the economy.
The ‘invisible hand’ is the central, all-purpose principle of Smith’s philosophy.
The text shows that the invisible hand appears only a few times and in specific contexts; Smith’s system is better understood through sympathy, justice, division of labor, and institutional analysis than through a single metaphor.
Source of confusion: Modern economics and popular discourse have elevated the image as a shorthand for spontaneous order, often out of proportion to its limited role in Smith’s own writings.
Smith uncritically celebrated capitalism and ignored its negative effects on workers and culture.
While he stresses the productivity and civilizing aspects of commercial society, the biography notes his worries about worker stupefaction, status competition, corruption of moral sentiments, and the need for education and institutional safeguards.
Source of confusion: Reading The Wealth of Nations solely as a defense of markets without attending to his critical comments or to the balancing perspective in The Theory of Moral Sentiments.
How does Smith’s concept of sympathy differ from simple benevolence, and why is this distinction important for his explanation of moral judgment in large, impersonal societies?
Hints: Look at Section 6 on The Theory of Moral Sentiments and Section 8 on moral psychology; note that sympathy applies to many emotions (including resentment) and operates through imaginative perspective-taking rather than direct altruistic concern.
In what ways does the impartial spectator function as a bridge between individual psychology and social norms in Smith’s system?
Hints: Connect Section 8’s account of the spectator with discussions of justice and punishment in Section 10 and virtue in Section 11; consider how internalized spectators’ judgments generate general rules and inform legal institutions.
What are the main benefits and drawbacks of the division of labor according to Smith, and how do these shape his views on education and the role of the state?
Hints: Review Section 7.2 and Section 9.2 for his analysis of productivity and worker stupefaction; then relate this to Section 10.3 on public works and education, asking why a pro-market thinker might support compulsory schooling.
How does Smith’s critique of mercantilism and his support for the ‘system of natural liberty’ depend on his broader account of justice and institutional design?
Hints: Read Sections 7.4, 9.3, and 10.1–10.4 together; think about why secure property rights, impartial justice, and limits on privilege are preconditions for markets to coordinate interests in a broadly beneficial way.
To what extent do Smith’s accounts of the ‘man of system’ and the ‘prudent man’ provide a critique of certain Enlightenment political projects?
Hints: Focus on Section 11.2 and link it with Section 12.3 on the ‘love of system’; consider how his suspicion of abstract political schemes relates to his admiration for systematic science in the History of Astronomy.
How do the stages of society in Smith’s jurisprudence (hunter, shepherd, agricultural, commercial) influence his views on property, law, and colonialism?
Hints: Use Section 10.2 for the ‘conjectural history’ and Section 14.4 on postcolonial critiques; ask how a stadial theory can both illuminate institutional development and risk reinforcing Eurocentric hierarchies.
Is Smith best understood as a theistic-providential thinker, a secular naturalist, or a moderate skeptic? What evidence from his moral and scientific writings supports your view?
Hints: Compare Section 6.5 (revisions to TMS), Section 12.1–12.4 (History of Astronomy and metaphysics), and Section 14.6; pay attention to how often he relies on providence for explanation versus psychological and social mechanisms.