The Wealth of Nations, Volume 1 and 2

Author: Adam Smith (UK)
Publisher:
Publish Date: 2005-10-01
Features: Adam Smith's The Wealth of Nations, full title An Inquiry into the Nature and Causes of the Wealth of Nations, was first published in 1776, the same year as the U.S. Declaration of Independence. In the development of capitalist society, The Wealth of Nations played a significant role. Editor Max Lerner commented: "This is a book that strangely mixes economics, philosophy, history, political theory, and practical plans, written by a person with profound knowledge and sharp insight. This person has strong analytical abilities, capable of filtering all the material in his notebooks; and strong synthetic abilities, capable of reorganizing it in new and notable ways. Smith was highly sensitive to the various ideas in his academic field at the time. He was not an isolated scholar confined to his house, like Marx later, but seemed to be fully equipped with antennas, able to receive and absorb all the information he could access. He wrote at the end of feudal Europe and the beginning of the modern world, a world where feudalism still persisted with the stubbornness of vested interest groups. He wrote precisely to oppose such interest groups. As a result, his book was not just written for library shelves; it had a profound impact on economic thought and state policy, shaping the entire environment we live in today." The last question Smith sought to answer in The Wealth of Nations was how the internal struggle between emotions and the "impartial spectator" played out on the grand stage of history in the long-term evolution of society. The answer to this question is found in the fifth book, where he outlines four main stages of social development, which would proceed sequentially unless hindered by resource scarcity, war, or bad government policies. These four stages are: the initial "savagery" stage of hunters, the second stage of primitive agriculture, the third stage of feudal or manorial "cultivation," and the fourth stage of commercially interdependent societies. Each stage is accompanied by institutions suited to its needs. For example, in the hunter stage, "there is no property, and therefore no established executive or regular judicial administration." With the emergence of herds of cattle and sheep, more complex forms of social organization arose, including not only "terrible" armies but also indispensable legal and order strongholds. The core of Smith's thought is that this system is a tool for protecting privileges and cannot be justified by natural law. He said, "Civil government was established for the security of property, in reality to protect the rich against the poor, that is, to protect those who possess property against those who possess none." Finally, Smith described the evolution as moving from feudalism to a stage that required new institutions, which were determined by the market rather than guilds, and were free rather than government-controlled. This later became known as laissez-faire capitalism, which Smith called a system of complete freedom. The continuous changes in the material production base would inevitably bring about changes in the superstructure, which bore a clear resemblance to Marxist historical materialism. However, there is also a significant difference: the final driving force in Marxist theory is class struggle, whereas in Smith's philosophy, the main driving mechanism is "human nature," driven by the desire for self-improvement and guided by reason. The Wealth of Nations is far from being a typical academic treatise. Although Smith also advocated laissez-faire, his arguments were more about opposing government intervention and monopolies; although he praised the results of greed, he almost always despised the behavior and strategies of merchants. He also did not think the commercial system itself was entirely admirable. Smith wrote in the pre-industrial capitalist era and seemed to fail to fully recognize the impending industrial revolution, the signs of which could already be seen in the ironworks nine miles from Edinburgh. He did not mention large-scale industrial enterprises. If growth was the theme of The Wealth of Nations, it was not endless growth. Throughout the book, there was a sense of the long-term decline in profit rates; Smith also noted that when this system had accumulated sufficient wealth, economic decline would begin, eventually leading to a state of impoverished stagnation.