Adam Smith and The Society as an Evolutionary Process
Adam Smith is often identified as the father of modern economics, distributed two major works that sparked an economic revolution. First, The Theory of Moral Sentiments discussed human ethics and how human communication relies on internal forces; sympathy, and conscience. Moreover, the book is a reality for people to understand that we do things out of self-interest but naturally end up helping others in the grand scheme. Second, The Wealth of Nations points out three main ideas; division of labor, productivity and the free market. Although there have been many changes between Adam Smith’s time and the present time, Smith’s perspective and concepts from both The Theory of Moral Sentiments and The Wealth of Nations remains relevant to today’s economy
His accounts of the division of labor and free trade, self-interest in exchange, the limits on government intervention, price, and the general structure of the market, all signify the moment when economics transitions to the “modern times” It is as the founder systematizer of capitalist economics that Smith is best known for. By explaining why a market economy is best able to meet the economic need of consumers, which he later on provided what is still the most cogent defense of modern capitalism. One purpose of his book “The Wealth of Nations” is to acquaint those who condemn the pursuit of self-interest on moral grounds with the altercation between the most sophisticated and nuanced exponents of social and moral uses of self-interest. For Smith morals, economics and government were closely interfered with. Far from being an individualistic Smith believed that it is the influence of society that brings and transforms people into the moral beings, he often thought that people misjudge their self-interest. His overarching goal was to improve human character as well as society itself. The “liberty” Smith advocated was not “freedom” from all control but freedom to control one’s own passion. The controlling freedom he used to refer, would be learned from such social institutions as the family, law, and the market itself. Therefore enhancing human characteristics will give us a “freer” individual.
In society, Smith intended to advertise his theory based on the principle of “Laissez Fairé” which requires that the state should not impose any restriction on freedom of an individual. The policy of Laissez-Faire allows the producers to produce as much as they like, earn as much income as they can, and save as much as they want. His theory build on laissez-faire, later on, gave rise to an opportunity for his concept of “invisible hand” to be known. Smith believed that it is safe to leave the economy to be propelled, regulated by an invisible hand. Invisible hand describes the unintended social benefits of an individual’s self-interested actions. Considering the two major works he released, Invisible Hand is a central theme in both of these works, and this theme bleeds into American society through Smith’s influence. Smith’s most prominent ideas–the “invisible hand” and division of labor–are now foundational economic theories.
Adam Smith, designing a decent society carried on his ideas he popularized living on in this modern economic system he built. To this day Smith’s writings touch upon almost every aspect of social life.
