The Wealth of Nations

   

An Inquiry into the Nature and Causes of the Wealth of Nations is the opus magnum of Adam Smith, published in 1776. It is a clearly written account of economics at the dawn of the industrial revolution. The work is broken down into five books between two volumes.

The Wealth of Nations is often mischaracterized and politicized. Many people are confident in their opinions regarding the author, the work, and the subject matter -- yet have never read it.

Subject Matter

The Industrial Revolution

In Book One: Chapters I & III illustrate the growth in division of labor. Chapter X part ii, motivates an understanding of the sunset of feudalism.

Mercantilism

It has been described as a critique of mercantilism and a synthesis of the emerging economic thinking of his time. The book is usually considered to be the beginning of modern economics. It was written for the average educated individual of the 18th century rather than for other economists. Thus, for today's readers interested in an accessible introduction to economics, this book continues to be much more useful even than many recent books on the subject.

The Invisible Hand

The Invisible Hand is an often-referenced concept from the book. The idea behind the "invisible hand" is the claim that people will unintentionally improve their community through pursuit of their own wants and needs.

"...he intends only his own security; and 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." (Book four, chapter II)

Meritocracy

Meritocracy is a strong theme in the work.

History

The Wealth of Nations came out of the Enlightenment Era. It influenced not only authors and economists, but governments and organizations. For example, Alexander Hamilton was impressed and influenced by The Wealth of Nations (see American Revolution). It has been said that this work was a response to the French writing on the subjects of good governance, including commerce and regulation, which is partially true. However, the work is a leap forward in economics, similar to Principia for Physics and modern Mathematics and the Physical Sciences generally.

Many authors were influenced by the book and used it as a starting point in their own work; such authors were Jean-Baptiste Say, David Ricardo, and later Karl Marx.

Anachronisms

Some commentary on the work suffers from anachronism. This is the result of reading the work as though it were written today. The book is written in modern English, but there are some points to consider:

Publishing History

There were five editions of The Wealth of Nations published during Smith's lifetime; specifically, in the years 1776, 1778, 1784, 1786, and 1789. Numerous editions appear after Smith's death in 1790. Under the direction of Edwin Cannan, the first five editions were compared, and the differences were published along with the an edited fifth edition in 1904 (see An Inquiry into the Nature and Causes of the Wealth of Nations, London: Methuen and Co., Ltd., ed. Edwin Cannan, 1904. Fifth edition.) There were minor but numerous differences (including the addition of many footnotes) between the first and the second editions, both of which were published in two volumes. The differences between the second and third editions, however, are major: In 1784, Smith annexed these first two editions with the publication of Additions and Corrections to the First and Second Editions of Dr. Adam Smith’s Inquiry into the Nature and Causes of the Wealth of Nations, and he also had published the now three volume third edition of the Wealth of Nations which incorporated Additions and Corrections and for the first time an index. Among other things, the Additions and Corrections included entirely new sections. The fourth edition published in 1786 had only slight differences with the third edition, and Smith himself says in the Advertisment at the beginning of the book, "I have made no alterations of any kind." Finally, Cannan notes only trival differences between the fourth and fifth editions – a set of misprints being removed from the fourth, and a different set of misprints being introduced into the fifth.

External links

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The Wealth of Nations


de:Wohlstand der Nationen eo:La Riĉo de Nacioj it:La ricchezza delle nazioni (Adam Smith) uk:Багатство народів zh:原富


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