Wealth of Nations by Adam Smith

Wealth of Nations Reviews

• 
  E. G.

  Acknowledgements
  Introduction
  Note on the Text
  Select Bibliography
  A Chronology of Adam Smith and His Times
  
  --An Inquiry into the Nature and Causes of the Wealth of Nations [Abridged]
  
  Explanatory Notes and Commentary
  Index
• 
  Petter Nordal

  What surprised me most about Smith's book was that his economic analysis of production, price and value is compatible with Marx's. I had read in so many places that Marx was the Left and Smith was the Right. Turns out, it really IS better to read the original.
• 
  Shane Goodyear

  * A complex book I somewhat hot it though
  * 3 modes of making money wage, profit, stock
  * Defence of nation, education and the facilitation of institutions for the benefit of manufacturing and trade. Is what the government should do
  * Does not like the mercantile system, a nation makes its wealth through the manufacturing system which blessing and benefits the whole society
  * Land has a large part to play in a nations revenue and stock
  * A person looks after his own interests but benefits the rest of society by doing that. Creating jobs etc manufacturing
  *
  * Mercantilism held that wealth was fixed and finite. The only way to prosper was to hoard gold and place tariffs on products from abroad. According to this theory, nations should sell their goods to other countries while buying nothing in return. Predictably, countries fell into rounds of retaliatory tariffs that choked off international trade.
  *
  * The central thesis of Smith's The Wealth of Nations is that our individual need to fulfill self-interest results in societal benefit.
  * He called the force behind this fulfillment the invisible hand.
  * Self-interest and the division of labor in an economy result in mutual interdependencies that promote stability and prosperity through the market mechanism.
  * Smith rejected government interference in market activities.
  * He believed that a government's three functions should be to protect national borders, enforce civil law, and engage in public works (e.g., education).
  *
  * if you specialize as a baker and produce only bread, you must rely on somebody else for your clothes, your meat, and your beer. Meanwhile, the people that specialize in clothes must rely on you for their bread, and so on. Prosperity emanates from the market that develops when people need goods and services that they can't create themselves.
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  * The invisible hand is not an actual, distinguishable entity. Instead, it is the sum of many phenomena that occur naturally when consumers and producers engage in commerce.
  
  
• 
  Matt

  I'm finally done with this, cover to cover, I won't say how long it took. Adam Smith was not the only person to write about "free market" but he seems to be the most famous. It really is a brilliant compilation, considering the time and context he wrote it. An even mixture of insight into what has become the fundamental model for "free market" and opinion on the state of affairs of his day. A lot of diversion from his theory into what he considers relevant examples. Also, Smith spends some time discussing the demerits of other systems and measures that counter his ideas of Free Market. While reading, I would try to gain insight into how Adam Smith might view today's system. Its an interesting thought exercise and I don't know enough about modern economics to expand.
  
  I wrote down a few notes while reading:
  
  Currency is necessary to facilitate exchange of goods, this is an obvious point now but nice to see it presented in the context he does. Not practical to deal in terms of swapping whole cows for the equivalent amount of goods. Also, he mentions that there needs to be a central administration (government) to issue currency.
  
  Labor is an accurate assessment of the value of something ie: the labor necessary to procure. Specialization of labor necessary in large settings, generalization necessary in small settings is usually greater than the expense of the materials. I think this is true in most settings, some exceptions where human life has less value and the commodity produced has extremely high value...
  
  Seems to imply that any govt intervention into the actions of stock, labor and commerce is bad, (comment about business meetings turning towards maximizing their profits at the expense of the general public (..conspiracy against the people…) must be taken in proper context. He also states that governments should not take measures against such meetings. (No discussion about worker unions/organizations, I don't think he would be for worker unions, though.)
  
  Implication that there are some professions that may be publicly funded, ie: public officials and teachers. Highly suspicious of the notion of publicly-funded education. Frequently describes "indignant" people in the context of "men of letters" studies funded by the public. Generally seems to think that pay-for-education would be superior due to the motivation of the instructors over publicly funded ones, but then later seems to imply that public educations would be better in due to the official recognition.
  
  He often attempts to quantify activities in locations where he apparently has no first hand knowledge or experiences. Example: quantifying how much time "savages" devote to making clothing for the family, thus freeing up others for food production. His point is correct; however, I feel his need to use such examples, odd, in today's context... An example of how the ideas are current even though much of the actual text is dated. Possibly an effect of the time where W. Europeans felt themselves intellectually superior to others.
  
  Discussion on the nature of what sorts of things remove capital from the economy of a nation. Luxuries, government spending (I'm using our term, not his), military/war. Basically, these expenses remove of circulating capital from the system and are not converted into fixed capital and stock, and thus are not used to produce more "rude" produce. Makes the explicit point that war is a waste of capital and labor resources. Soldiers could be working and adding to an economy instead of fighting wars and consuming circulating capital. He seems to think war is a waste of money.
  
  Tariffs and subsidies bad and harmful to a free economy in the long run. They are inhibitory of industry as they swing costs and labor out of their natural state and discourage innovation. The consumer doesn't benefit as they would pay in taxes (subsidies) what they might pay for more expensive foreign goods. Also goods that can be made cheaper abroad should be made abroad thus freeing up labor to other industrious pursuits at home. Interesting discussion about the value of colonies, he spends some effort in discussing the negative virtues of a mercantile economy but concedes that colonies are good and that both the colony and the home country benefit from the relationship more than they suffer (so long as liberties are preserved). His view on slavery is hard to get around. He clearly states that slavery is a bad practice, inhumane, etc… but feels the need to mention that slave labor has a positive influence on profits.
  
  Currency should be issued by a central authority and it is OK to commit revenue (taxes) to keep this system running. Generally says that there are public positions and infrastructure such as schools, roads and bridges, police/military protection that are necessary to facilitate commerce and should be paid for with public money (taxes). These positions are good so long as they only serve to promote the flow of commerce. Very suspicious of taxation. He writes that taxation should be at the convenience of the payer and really only when necessary. Cautions about corruption in publicly funded positions and warns of publicly funded officials wasting money.
  
  Debt is bad, countries that spend more on luxuries than rude produce cannot sustain this practice and will eventually fail. Interesting discussion about Great Britain's sustaining of colonies during this period. He has contempt for the American colonies because of the money Britain has spent (often contracted debt for) to sustain them, much of it military debts. Ultimately he seems to think that Britain should either expect the colonies to pay more of their own expenses or Britain should cut them loose. He then says that the colony benefits more than the parent nation from this arrangement.
  
• 
  Carter

  This is something, that was assigned reading in college, for a sociology class, with M. Postone. I recently, have been reviewing the book again. Old classics like these, are a window in time- a detailed and thorough analysis, which became the foundation for early economics specific to capitalism.
• 
  Neil

  +10 intelligence.
• 
  Joseph

  There is an overwhelming amount of information in this book, ranging from the 100 or so pages dedicated to the history of the prices of produce in Europe, to the large section dedicated to Smith's argument that precious metals are no measure for a nation's true wealth, but rather production of labor within the country.
  
  I learned a lot of things about supply and demand, division of labor, and the ways in which a free society help all classes to lead a better quality of life. There are also some interesting discourses about how monopolies effect economies in a negative way, which I could see parallels of in today's world (Saudi Arabian oil anyone?), and I can genuinely say that most of this book is a work of genius, and I can see why Thomas Jefferson liked it so much.
  
  There are however, near the end of the book, some points in which Adam Smith's amazingly practical, historically-proven observations go out the window. His views on how education should be paid for (I don't think he foresaw just how populous we are in the 21st century; and the idea that the government can be corrupt, but the rich can't be is absurd), and how roads should be maintained (I would argue our federally-maintained freeway system is much more impressive than any road system in Europe at the time) aren't as well thought out, and I can't say I'm fully convinced that the rich will always give to the poor, or to infrastructure, willingly. In fact, I was more and more convinced of a progressive tax system as a second-best alternative to Adam Smith's libertarian Utopia as I read.
  
  I learned a lot, and besides that last 5th of the book, I think it's an incredible work (though dense at times, and not for the faint of heart), and you can see Adam Smith's deep influence in today's prevailing economic theories. Although you could get this same information through modern sources, reading what is practically the source material for modern capitalist thought is well worth it.
• 
  Durakan

  An excellent book, that appealed not only to my adopted interest in economics, but also my natural interest in history and philosophy.
  
  What I really like about the Wealth of Nations is the way Smith explains everything with absolute clarity, covering the fundamentals that are generally left out of the modern classroom (e.g. why we use coinage, and exactly what it represents). While much of the book uses contemporary evidence to support itself, the principles can generally be applied to the present day, although I still harbour a perverse desire to bring Adam Smith back from the dead and hear his thoughts on our modern economies that subsist predominantly on what he terms 'unproductive' labour. I bet he didn't see that one coming!
  
  The one problem is that I have now been turned into a vigorous proponent of free market economics, so I probably need to read some criticism to rebalance my views. Smith likes to accuse mercantilists of sophistry, but (at least according to the editor of my edition) he occasionally seems to stray into that territory himself, and omits altogether any criticism of the policies that he supports most strongly... but hey, he's probably right.
  
  In short, I loved it, and it has significantly increased my understanding of the way things work!
• 
  Ly Nguyen

  Wealth of Nations by Adam Smith left impression for the comprehensive nature, as well as the writing style of the author. It was sort of detailed and covered major events in the European economy and its history over the course of time. This work is indeed a classic publication, and the notable point about it was the fundamental matters related to the economy of Europe in general and Great Britain in particular. I think it is a helpful and worthwhile publication for anyone concerned about the economy, and its history.
• 
  Cameron Mitchell

  It's much more compelling to read Adam Smith than the economists who bastardize his theories.
• 
  John Poulain

  Essential Basic Foundations for economics.