Book Festival: A New Look At The Ideas Of The Founder Of Modern Economics

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Nicholas Phillipson, Alan Little (chair)
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"The Wealth of Nations" has never been out of publication since it first appeared some two hundred and thirty years ago. Nicholas Phillipson’s new study of its author, "Adam Smith, An Intellectual Biography", seeks to place both Smith and his most well known work in appropriate context.

Phillipson points out that until early in the previous century, Smith’s work was not regarded as a defence of capitalism, far less as a tract for libertarianism.

Smith, says Phillipson, is concerned with more than simply a commentary on the European economy of his own day. His earlier, less well known and read work "The Theory of Moral Sentiments" indicates his grand plan of an over-arching social theory explaining how societies grow and develop.

He explains commerce as an extension of language, created to facilitate exchange between strangers, and thus part of the foundation of trust enabling the "good society" to progress. Smith’s humans are frail animals, subject to the savage natural world around them, compelled to co-operation for survival and thereby to association with and trust of their fellows.

From such basic beginnings, exchange and ultimately commerce owe their origins. Smith’s form of economic Darwinism is thus strikingly different from that normally ascribed to him by libertarian economists. If Phillipson seems more at ease with the arguments of ‘The Theory of Moral Sentiments’ than ‘The Wealth of Nations’ it has also to be borne in mind that both of these works were only parts of Smith’s output, of which only a small part survives.

The discovery of extensive notes from Smith’s University of Glasgow lectures on Rhetoric and Jurisprudence offer a glimpse of Smith not only as teacher but as thinking through other aspects of his theory which have not survived in other forms.

It’s perhaps worth mentioning that the phrase "the invisible hand", beloved of free-market economists, appears but three times in Smith’s work; as a close friend of the intellectually rigourous atheist David Hume, Smith’s own views were likely similar, but living with his mother in douce Kirkcaldy whilst writing The Wealth of Nations, he may well have felt a need to appear to conform to something close to conventional piety.

Phillipson has produced the first serious re-appraisal of the thought of Adam Smith this century; it is likely to engender discussion, and, one hopes, re-reading of Smith himself, for a long time to come.

Nicholas Phillipson appeared at the Edinburgh International Book Festival on 19 August.