1. Life and scientific activities
2. The significance of A. Smith’s economic works
3. Smith's interpretation of economic laws
Adam Smith is a Scottish economist and philosopher, one of the largest representatives of classical political economy. He created the theory of labor value and substantiated the need for the possible liberation of a market economy from government intervention.
In “A Study on the Nature and Causes of the Wealth of Nations” (1776), he summarized the century-long development of this direction of economic thought, examined the theory cost and the distribution of income and its accumulation, the economic history of Western Europe, views on economic policy, state finances. A. Smith approached economics as a system in which objective laws, amenable to knowledge. In life Adam Smith The book went through 5 English and several foreign editions and translations.
Life and scientific activities
Was born Adam Smith in 1723 in the small Scottish town of Kirkcaldy. His father, a minor customs official, died before his son was born. Adam's mother gave him a good upbringing and had a huge moral influence on him.
Adam, aged fourteen, comes to Glasgow to study mathematics and philosophy at university. The most vivid and unforgettable impressions were left on him by the brilliant lectures of Francis Hutchison, who was called “the father of speculative philosophy in Scotland in modern times.” Hutchison was the first of the professors at the University of Glasgow to give his lectures not in Latin, but in ordinary spoken language, and without any notes. His commitment to the principles of “reasonable” religious and political freedom and unorthodox ideas about a just and good Supreme Deity, caring for human happiness, caused discontent among the old Scottish professors.
In 1740, due to circumstances, Scottish universities were able to send several students each year to study in Britain. Smith goes to Oxford. During this long journey on horseback, the young man never ceased to be amazed at the wealth and prosperity of this region, so different from the economical and reserved Scotland.
Oxford met Adam Smith inhospitably: the Scots, of whom there were very few, felt uncomfortable, subjected to constant ridicule, indifferent, and even unfair treatment by teachers. Smith considered the six years spent here to be the most unhappy and mediocre of his life, although he read a lot and constantly studied on his own. It is no coincidence that he left the university ahead of schedule, without receiving a diploma.
Smith returned to Scotland and, abandoning his intention to become a priest, decided to earn his living through literary activity. In Edinburgh he prepared and delivered two courses of public lectures on rhetoric, belles lettres and jurisprudence. However, the texts have not survived, and an impression of them can only be formed from the memories and notes of some listeners. One thing is certain: these speeches already brought Adam Smith his first fame and official recognition: in 1751 he received the title of professor of logic, and the following year - professor of moral philosophy at the University of Glasgow.
Probably, Adam Smith lived happily for the thirteen years that he taught at the university - political ambitions and the desire for greatness were alien to him by nature. He believed that happiness is available to everyone and does not depend on position in society, and true pleasure comes only from satisfaction work, peace of mind and physical health. Smith himself lived to old age, maintaining clarity of mind and extraordinary diligence.
Adam was an unusually popular lecturer. Adam's course, which consisted of natural history, theology, ethics, law and politics, attracted numerous students who came from even remote places. The very next day, new lectures were hotly discussed in clubs and literary societies in Glasgow. Smith's admirers not only repeated the expressions of their idol, but even tried to accurately imitate his manner of speaking, especially his exact pronunciation.
Meanwhile, Smith hardly resembled an eloquent speaker: his voice was harsh, his diction was not very clear, and at times he almost stuttered. There was a lot of talk about his absent-mindedness. Sometimes those around him noticed that Smith seemed to be talking to himself, and a slight smile appeared on his face. If at such moments someone called out to him, trying to engage him in a conversation, he immediately began to rant and did not stop until he had laid out everything he knew about the subject of discussion. But if anyone expressed doubts about his arguments, Smith instantly renounced what he had just said and, with the same fervor, convinced of the exact opposite.
A distinctive feature of the scientist’s character was gentleness and compliance, reaching a certain timidity; this was probably due to the female influence under which he grew up. Almost until his very last years, he was carefully looked after by his mother and cousin. Adam Smith had no other relatives: they said that after the disappointment suffered in his early youth, he forever abandoned thoughts of marriage.
His penchant for solitude and a quiet, secluded life caused complaints from his few friends, especially the closest of them, Hume. Smith became friends with the famous Scottish philosopher, historian and economist David Hume in 1752. In many ways they were similar: both were interested in ethics and political economy, and had an inquisitive mindset. Some of Hume's brilliant insights were further developed and embodied in the works of Smith.
In their friendly union, David Hume undoubtedly played a leading role. Adam Smith did not possess significant courage, which was revealed, among other things, in his refusal to take upon himself, after Hume’s death, the publication of some of the latter’s works that were anti-religious in nature. Nevertheless, Smith was a noble nature: full of desire for truth and the high qualities of the human soul, he fully shared the ideals of his time, on the eve of the Great French Revolution.
In 1759, Adam Smith published his first essay, which brought him wide fame, “The Theory of Moral Sentiments,” where he sought to prove that a person has a feeling of sympathy for others, which motivates him to follow moral principles. Immediately after release work Hume wrote to a friend with his characteristic irony: “Indeed, nothing can hint more strongly at error than the approval of the majority. I proceed to present the sad news that your book is very unhappy, because it has earned excessive admiration from the public.”
The Theory of Moral Sentiments is one of the most remarkable works on ethics of the 18th century. As a successor mainly to Shaftesbury, Hutchinson and Hume, Adam Smith developed a new ethical system that represented a major step forward compared to the systems of his predecessors.
A. Smith became so popular that soon after the publication of The Theory he received from the Duke of Bucclei to accompany his family on a trip to Europe. The arguments that forced the respected professor to leave his university chair and his usual social circle were weighty: the Duke promised him 300 pounds a year not only for the duration of the trip, but also after, which was especially attractive. Being constant for the rest of your life eliminated the need to earn a living.
The journey lasted almost three years. UK they left in 1764, visited Paris, Toulouse, other cities of southern France, and Genoa. The months spent in Paris were remembered for a long time - here Adam Smith met almost all the outstanding philosophers and writers of the era. He met with D'Alembert, Helvetius, but became especially close to Turgot, a brilliant economist, the future controller general of finance. Poor knowledge of French did not prevent Smith from talking with him for a long time about political economy. Their views had a lot in common with the idea of free trade and limiting intervention states into the economy.
Returning to his homeland, Adam Smith retires to his old parents' house, devoting himself entirely to working on the main book of his life. About ten years passed almost completely alone. In letters to Hume, Smith mentions long walks along the seashore, where nothing disturbed his thoughts. In 1776, “An Inquiry into the Nature and Causes of the Wealth of Nations” was published - a work combining abstract theory with a detailed description of the features of development trade and production.
With this last work, Smith, according to popular belief at that time, created a new science - political economy. The opinion is exaggerated. But no matter how one evaluates the merits of Adam Smith in the history of political economy, one thing is beyond doubt: no one, either before or after him, played such a role in the history of this science. “The Wealth of Nations” is an extensive treatise of five books, containing an outline of theoretical economics (books 1-2), the history of economic teachings in connection with general economic history Europe after the fall of the Roman Empire (3-4th books) and financial science in connection with the science of management (5th book).
The main idea of the theoretical part of “The Wealth of Nations” can be considered the position that the main source and factor of wealth is human labor - in other words, man himself. The reader encounters this idea on the very first pages of Smith’s treatise, in the famous chapter “On the Division of Labor.” The division of labor, according to Smith, is the most important engine of economic progress. As a condition that sets a limit to the possible division of labor, Smith points to the vastness of the market, and this elevates the entire teaching from a simple empirical generalization, expressed by Greek philosophers, to the level of scientific law. In his doctrine of value, Smith also highlights human labor, recognizing labor as a universal measure of exchange value
His criticism of mercantilism was not abstract reasoning: he described the economic system in which he lived and showed its unsuitability for new conditions. Observations made earlier in Glasgow, then still a provincial city, which was gradually turning into a large commercial and industrial center, probably helped. According to the apt remark of one of his contemporaries, here after 1750 “not a single beggar was visible on the streets, every child was busy with work”
Adam Smith was not the first to debunk economic misconceptions politicians mercantilism, which involved artificial encouragement state individual industries, but he managed to bring his views into a system and apply it to reality. He defended freedom trade and state non-interference in the economy, because he believed that only they would provide the most favorable conditions for obtaining the greatest profit, and therefore would contribute to the prosperity of society. Smith believed that the functions of the state should be reduced only to the defense of the country from external enemies, the fight against criminals and the company of economic activities that are beyond the power of individuals.
The originality of Adam Smith did not lie in particulars, but as a whole, his system was the most complete and perfect expression of the ideas and aspirations of his era - the era of the fall of the medieval economic system and the rapid development of the capitalist economy. Smith's individualism, cosmopolitanism and rationalism are in complete harmony with the philosophical worldview of the 18th century. His ardent belief in freedom is reminiscent of the revolutionary era of the late 18th century. The same spirit permeates Smith's attitude towards the working and lower classes of society. In general, Adam Smith is completely alien to that conscious defense of the interests of the upper classes, the bourgeoisie or landowners, which characterized the social position of his disciples of later times. On the contrary, in all cases where the interests of workers and capitalists come into conflict, he energetically takes the side of the workers. Nevertheless, Smith's ideas benefited the bourgeoisie. This irony of history reflected the transitional nature of the era.
In 1778, Adam Smith was appointed as a member of the Scottish Customs Board. Edinburgh became his permanent place of residence. In 1787 he was elected rector of the University of Glasgow.
Now arriving in London, after the publication of The Wealth of Nations, Smith was met with resounding success and admiration from the public. But William Pitt the Younger became his especially enthusiastic admirer. He was not even eighteen when Adam Smith’s book was published, which largely influenced the formation of the views of the future prime minister, who tried to put into practice the main principles of Smith’s economic theory.
In 1787, Smith's last visit to London took place - he was supposed to attend a dinner where many famous people gathered politicians.
Smith came last. Immediately everyone rose to greet the distinguished guest. “Sit down, gentlemen,” he said, embarrassed by the attention. “No,” Pitt replied, “we will remain standing until you sit down, because we are all your students.” “What an extraordinary man Pitt is,” Adam Smith later exclaimed, “he understands my ideas better than I do myself!”
Recent years have been painted in dark, melancholic tones. With the death of his mother, Smith seemed to have lost the will to live, the best was left behind. Honor did not replace departed friends. On the eve of his death, Smith ordered all unfinished manuscripts to be burned, as if once again reminding him of his contempt for vanity and worldly vanity.
Adam Smith died in Edinburgh in 1790.
Shortly before his death, Smith apparently destroyed almost all of his manuscripts. What survived was published in the posthumous Essays on Philosophical Subjects, 1795.
The significance of A. Smith's economic works
In the process of studying the main issue of this essay, I looked at several, in my opinion, the most suitable sources. In these books I found many often completely contradictory opinions about the role and place of Smith's teachings in economic science.
K. Marx, for example, characterized A. Smith as follows: “On the one hand, he traces the internal connection of economic categories, or the hidden structure of the bourgeois economic system. On the other hand, he puts next to this the connection as it is given in a visible way in phenomena competition..." According to Marx, the duality of Smith’s methodology (which K. Marx was the first to point out) led to the fact that not only “progressive economists who sought to discover the objective laws of the movement of capitalism, but also apologist economists who tried to justify the bourgeois system by analyzing the external appearance of phenomena and processes".
The assessment of Smith's works given by S. Gide and S. Rist is noteworthy. It is as follows. Smith borrowed all the important ideas from his predecessors in order to "pour" them into a "more general system." By getting ahead of them, he rendered them useless, since Smith replaced their fragmentary views with true social and economic philosophy. Thus, these views receive a completely new value in his book. Rather than remaining isolated, they serve to illustrate a general concept. From it they, in turn, borrow more light. Like almost all great “writers,” A. Smith, without losing his originality, could borrow a lot from his predecessors...
And the most interesting opinion about Smith’s works, in my opinion, was published by M. Blaug: “There is no need to portray Adam Smith as the founder of political economy. Cantillon, Quesnay and Turgot can be awarded this honor with much greater justification. However, Cantillon’s Essays, Quesnay’s articles , Turgot's "Reflections" are, at best, lengthy brochures, dress rehearsals for science, but not yet science itself. "An Inquiry into the Nature and Causes of the Wealth of Nations" is the first full-fledged work in economic science, setting out the general basis of science - the theory of production and distribution. , then an analysis of the action of these abstract principles on historical material and, finally, a number of examples of their application in economic policy, and all this work is imbued with the high idea of "an obvious and simple system of natural freedom", towards which, as it seemed to Adam Smith, the world was heading." .
The central motif - the soul of "The Wealth of Nations" - is the action of the "invisible hand". The idea itself, in my opinion, is quite original for the 18th century. and could not go unnoticed by Smith's contemporaries. However, already in the 18th century. there was an idea of the natural equality of people: every person, regardless of birth and position, should be given an equal right to pursue his own benefit, and the whole society would benefit from this.
Adam Smith developed this idea and applied it to political economy. The scientist’s idea of human nature and the relationship between man and society formed the basis of the views of the classical school. The concept of "homo oeconomicus" ("economic man") arose somewhat later, but its inventors relied on Smith. The famous phrase about the "invisible hand" may be the most often quoted passage from The Wealth of Nations. Adam Smith was able to guess the most fruitful idea that under certain social conditions, which we today describe with the term “working,” private interests can indeed be harmoniously combined with the interests of society.
The formation of the classical economic school is associated with the name of the outstanding English scientist Adam Smith (1723-1790). It was A. Smith who developed and presented the economic picture of society as a system. His main work is “An Inquiry into the Nature and Causes of the Wealth of Nations” (1776). It presents the following theoretical principles.
1. Market economy. A. Smith put forward the abstraction “economic man”, which characterizes in its pure form the actions of people in the economy. “Economic man,” in his opinion, is guided only by profit, like an egoist. Exchange is born from the nature of an egoistic person, since he does not give gifts and if he gives something, he demands at least equivalent compensation. Thus, exchange and the market economy, according to A. Smith, are natural for humans. Another methodological category of the researcher was the “invisible hand”. The “invisible hand” is objective economic laws that operate independently of the will and consciousness of people. Connecting the concept of the “invisible hand” with the category of “economic man,” A. Smith noted that a person, “in pursuit of his own interests, often serves the interests of society more effectively than when he consciously strives to do so,” that the “invisible hand” the market produces better results for society than government regulation. This is explained by the fact that, acting under the conditions of the “invisible hand,” a person satisfies, first of all, his personal interest and therefore works well (for himself, but at the same time for society). Thus, A. Smith substantiated the concept of freedom from government intervention in the economy, which was called the concept of “economic liberalism.”
2. Wealth. According to A. Smith, the main factors in increasing wealth are the number of workers and their productivity. The source of wealth, the creator of all values, is labor, namely, “the annual labor of each nation,” directed for annual consumption.
3. Division of labor. First, the division of labor in a pin factory is given as an example, which helps to increase labor productivity by improving the worker’s skill in performing a separate operation and saving time when moving from one operation to another. The division of labor on the scale of the national economy brings the same result. At the same time, the origin of the division of labor at the micro- and macroeconomic levels is different. If in manufacturing the specialization of workers is set by the manager, then in the national economy it is created, according to A. Smith, by the “invisible hand”.
4. Money. This is a product that spontaneously emerged in the process of turning to the role of a universal equivalent to overcome the difficulties of direct product exchange. Among the functions of money, A. Smith singled out the function of a medium of exchange.
5. Cost and price. A. Smith points out that all goods have one common property - that they are a product of labor. The author comes to the conclusion that value is nothing more than the amount of necessary labor contained in a product. In addition, the value is determined not by the actual labor costs of a particular manufacturer, but by the costs that, on average across industries, are necessary to create such a product at a given level of development of productive forces.
Since among the goods a universal equivalent (money) has already emerged, a measurement of value in money appears, i.e. price. A. Smith notes that the price may deviate from the value: for a short time - under the influence of fluctuations in supply and demand, for a long time - under the influence of a monopoly.
A. Smith moves to a capitalist economy, when the worker creates a product, and the capitalist becomes its owner and seller. For a capitalist, the cost of a commodity is based on the costs of paying workers, purchasing means of production and renting land. But what is a cost for the capitalist is at the same time an income for the workers, the capitalist himself and the landowner. This is the meaning of the formulation according to which “wages, profit and rent are the three original sources of value.” Consequently, A. Smith did not include the cost of consumed means of production in the cost of goods.
6. Salary. The lower limit of wages, according to A. Smith, is the cost of the minimum means of subsistence for the worker and his family, which is influenced by the material and cultural level of development of the country. Wages also depend on the demand and supply of labor in the labor market. A. Smith was one of the first supporters of high wages, because such wages improve the position of the lower strata of the people and materially interest the worker in increasing labor productivity.
7. Profit. A. Smith gave a twofold definition of the essence of profit. On the one hand, his profit is a reward for entrepreneurial activity. On the other hand, profit represents a certain amount of labor that the capitalist did not pay the worker. He justified this by the fact that profit is not consistent with the amount and complexity of work in managing the enterprise. In addition, it depends on the amount of capital used.
8. Capital. The author gives a unique interpretation of capital turnover and the division of capital into fixed and circulating capital. Fixed capital generates profit “without passing from one owner to another or without further circulation.” In fixed capital it includes buildings and structures, land improvements, machinery, and professional qualifications of workers. Working capital serves its owner by “constantly leaving him in one form and returning in another.” It is represented by money, raw materials and finished products. Thus, A. Smith understood turnover as the transfer of a thing from one owner to another.
9. Interpretation of productive and unproductive labor. According to A. Smith, only labor that produces goods and creates value can be considered productive. Unproductive labor, accordingly, does not produce goods and cannot create value. He classified the entire sphere of immaterial production as unproductive labor.
10. The role of the state in the economy. Without completely rejecting participation in economic life and control by the state, A. Smith assigns it the role of a “night watchman”, and not a regulator and regulator of economic processes. He identifies three functions that the state is called upon to perform: administration of justice, defense of the country, organization and maintenance of public institutions.
(English) Adam Smith); baptized and possibly born June 5 (June 16), 1723, Kirkcaldy - July 17, 1790, Edinburgh) - Scottish economist, ethical philosopher; one of the founders of modern economic theory.
Adam Smith was born in June 1723 (the exact date of his birth is unknown) and baptized on June 5 in the town of Kirkcaldy in the Scottish county of Fife, in the family of a customs official. His father, also named Adam Smith, died 2 months before his son was born. At the age of 4, he was kidnapped by gypsies, but was quickly rescued by his uncle and returned to his mother. It is assumed that Adam was an only child in the family, since no records of his brothers and sisters have been found anywhere.
At the age of 14 he entered the University of Glasgow, where he studied ethical foundations of philosophy for two years under the guidance of Francis Hutcheson. In 1740 he entered Balliol College, Oxford, and graduated in 1746. Smith was critical of the quality of teaching at Oxford.
In 1748, Smith began lecturing in Edinburgh under the patronage of Lord Kames. It was the preparation of lectures for students at this university that became the impetus for Adam Smith to formulate his ideas about the problems of economics. The basis of Adam Smith's scientific theory was the desire to look at man from three sides:
- from the standpoint of morality and morality;
- from civil and government positions;
- from an economic point of view.
Adam lectured on rhetoric, the art of letter writing, and later on the subject of "the acquisition of wealth", where he first expounded in detail the economic philosophy of the "evident and simple system of natural liberty", which was reflected in his most famous work, An Inquiry into the Nature and Causes of the Wealth of Nations "
Around 1750, Adam Smith met David Hume, who was almost a decade older than him. The similarity of their views, reflected in their writings on history, politics, philosophy, economics and religion, shows that together they formed an intellectual alliance that played an important role in the period of the so-called Scottish Enlightenment.
In 1751 Smith was appointed professor of logic at the University of Glasgow. Smith lectured on ethics, rhetoric, jurisprudence, and political economy. In 1759, Smith published an article incorporating material from his lectures. In this article, Smith discussed the standards of ethical behavior that keep society in a state of stability.
Smith gained fame after publishing the book An Inquiry into the Nature and Causes of the Wealth of Nations in 1776.
In 1776, the scientist moved to London, where he published “An Inquiry into the Nature and Causes of the Wealth of Nations.” This book describes in detail the consequences of economic freedom. The book includes discussions of concepts such as laissez faire(the principle of laissez-faire), the role of selfishness, the division of labor, the functions of the market and the international significance of a free economy. The Wealth of Nations discovered economics as a science, launching the doctrine of free enterprise.
In 1778, Smith was appointed head of the customs office in Edinburgh, Scotland, where he died after a long illness on July 17, 1790.
Scientific achievements
The development of industrial production in the 18th century led to an increase in the social division of labor, which required an increase in the role of trade and money circulation. The emerging practice came into conflict with the prevailing ideas and traditions in the economic sphere. There was a need to revise existing economic theories. Smith's materialism allowed him to formulate the idea of the objectivity of economic laws.
Smith laid out a logical system that explained the workings of the free market based on internal economic mechanisms rather than external political control. This approach is still the basis of economic education.
Smith formulated the concept of " economic man" And " natural order" Smith believed that man is the basis of all society, and studied human behavior with its motives and desire for personal gain. The natural order in Smith's view is market relations in which each person bases his behavior on personal and selfish interests, the sum of which forms the interests of society. In Smith's view, this order ensures wealth, well-being and development of both the individual and society as a whole.
The existence of natural order requires " system of natural freedom", the basis of which Smith saw in private property.
Smith's most famous aphorism is " invisible hand of the market" - a phrase he used to demonstrate the autonomy and self-sufficiency of a system based on selfishness, which acts as an effective lever in the distribution of resources. Its essence is that one’s own benefit is achievable only through satisfying someone else’s needs. Thus, the market “pushes” producers to realize the interests of other people, and together to increase the wealth of the entire society. At the same time, resources, under the influence of the “signal system” of profit, are moved through the system of supply and demand to those areas where their use is most effective.
Polemicizing with the theorists of mercantilism, who identified wealth with precious metals, and with the physiocrats, who saw the source of wealth exclusively in agriculture, Smith argued that wealth is created by all types of productive labor. Labor, he argued, also acts as a measure of the value of goods. At the same time, however, Adam Smith (unlike the 19th century economists - David Ricardo, Karl Marx, etc.) did not mean the amount of labor that was spent on the production of a product, but that which can be purchased for this product. Money is just one type of commodity and is not the main purpose of production.
Adam Smith associated the well-being of society with increased labor productivity. He considered the most effective means of increasing it to be the division of labor and specialization, citing the now classic example of the pin factory. However, the degree of division of labor, he emphasized, is directly related to the size of the market: the wider the market, the higher the level of specialization of the producers operating in it. This led to the conclusion that it was necessary to abolish such restrictions for the free development of the market as monopolies, workshop privileges, laws on residence, compulsory apprenticeship, etc.
According to Adam Smith's theory, the initial value of a product during distribution is divided into three parts: wages, profit and rent. With the growth of labor productivity, he noted, there is an increase in wages and rent, but the share of profit in the newly produced value decreases. The total social product is divided into two main parts: the first - capital - serves to maintain and expand production (this includes the wages of workers), the second goes for consumption by the unproductive classes of society (owners of land and capital, civil servants, military personnel, scientists, liberal professions). etc.). The well-being of society depends on the ratio of these two parts: the larger the share of capital, the faster social wealth grows, and, conversely, the more funds spent on unproductive consumption (primarily by the state), the poorer the nation.
At the same time, A. Smith did not seek to reduce the influence of the state on the economy to zero. The state, in his opinion, should play the role of an arbiter, and also carry out those socially necessary economic activities that private capital cannot do.. (A.V. Chudinov).
Scientific works
(June 1723 - 07/17/1790), Scottish economist and
philosopher, one of the founders of modern economics
theories.
short biography
Adam Smith
Scottish economist and
philosopher, one of the greatest representatives
classical political economy, born in
Kirkcaldy (Scotland) in June 1723
(the exact date of his birth is unknown) and
baptized June 5 in Kirkcaldy, Scotland
County of Fife, in the family of a customs official.
His father died 6 months before Adam was born.
At the age of 4 he was kidnapped by gypsies,
but was quickly rescued by his uncle and returned to his mother. It is assumed that
Adam was the only child in the family, as it is not found anywhere
records about his brothers and sisters.
In 1737 he entered the University of Glasgow. There, under the guidance
Francis Hutcheson, he studied the ethical foundations of philosophy. Hutcheson
had a strong influence on his worldview.
In 1740 he received a Master of Arts degree and a private scholarship for
continuing his studies at Oxford, where he attended Balliol College, Oxford
He studied at the university until 1746. However, he was not satisfied
level of teaching, since most professors didn’t even read
their lectures. Smith returns to Edinburgh, intending to take up
self-education and lecturing. In 1748, under the patronage
Lord Kames, he begins to lecture on rhetoric, art
letter writing, and later economic philosophy.
In 1748, Smith, under the patronage of Lord Kames, began reading
public lectures on literature and natural law in Edinburgh,
then in rhetoric, the art of writing letters, and later in
economic philosophy, as well as on the subject of “achieving wealth”,
where he first expounded in detail the economic philosophy of the "obvious
and a simple system of natural freedom,” and so on until 1750.
From 1751 Smith was a professor of logic at the University of Glasgow, and from 1752 he was a professor.
moral philosophy. In 1755 he published his first articles in the magazine
Edinburgh Review. In 1759 Smith released
light philosophical work on ethics “The Theory of Moral Sentiments”,
brought him international fame. In 1762 Smith received
academic degree of Doctor of Law.
Subsequently, his lectures were reflected in the most famous
Adam Smith's work: An Inquiry into the Nature and Cause of Wealth
peoples." During Smith's lifetime, the book went through 5 English editions and several
foreign publications and translations.
Around 1750, Adam Smith met David Hume,
who was almost a decade older than him. Their works on history,
politics, philosophy, economics and religion show their similarities
views. Their alliance played one of the most important roles during the period
the emergence of the Scottish Enlightenment.
In 1781, at just 28 years old, Smith was appointed professor
logic at the University of Glasgow, at the end of the year he moved to the department
moral philosophy, which he taught until 1764. He read
lectures on rhetoric, ethics, jurisprudence and political economy.
Adam Smith's scientific work "The Theory" was written in 1759.
moral feelings" containing materials from his lectures brought him
fame. The article discussed standards of ethical behavior,
which maintain society in a state of stability.
However, A. Smith's scientific interest shifted to economics, partly this
was the influence of his friend - the philosopher and economist David Hume, as well as
Smith's participation in the Glasgow Club of Political Economy.
In 1776, Adam Smith resigned his chair and, accepting an offer from
political figure - Duke of Buccleuch, accompany him abroad
the journey of the Duke's stepson. First of all, a suggestion for Smith
What was interesting was that the Duke offered him payment, significantly
exceeding his professorial fee. This journey lasted
more than two years. Adam Smith spent a year and a half in Toulouse, two months in
Geneva, where he met Voltaire. For nine months they lived in
Paris. At this time he became closely acquainted with French philosophers:
d'Alembert, Helvetius, Holbach, as well as with the physiocrats: F. Quesnay and
A. Turgot.
Publication in London in 1776 of the book “An Inquiry into the Nature and Causes of
wealth of nations" (which Smith began in Toulouse) brings to Adam
Smith is widely known. The book describes in detail the consequences
economic freedom. A system explaining the work of free
market is still the basis of economic education. One of
key provisions of Smith's theory - the need for liberation
economy from government regulation that prevents
natural development of the economy. According to Smith, people's desire
buy where it’s cheaper and sell where it’s more expensive, naturally, and therefore
all protectionist duties and incentives for exports
harmful, as are any obstacles to the free circulation of money. Most
Smith's famous aphorism - the invisible hand of the market - a phrase that he
used to explain selfishness as an effective lever in
distribution of resources.
In 1778 Smith received the post of Commissioner of Customs for Scotland and
settles in Edinburgh.
In November 1787, Adam Smith became honorary rector
University of Glasgow.
He died on July 17, 1790 in Edinburgh after a long illness.
There is a version that shortly before his death, Smith destroyed all his
manuscripts. What survived was published in the posthumous “Experiments on
Philosophical Subjects" in 1795, five years after his death.
Based on materials: Wikipedia, ru.wikipedia.org
The material was prepared based on information from open sources
Economic theory of Adam Smith
Very briefly, one can characterize the teachings of Adam Smith in two words: laisser faire, which translated from French means non-interference, non-resistance and even connivance. Smith's book An Inquiry into the Nature and Causes of the Wealth of Nations (1776) explains the policy of laissez-faire.
If the economic activity of each person leads to the good of society, the main thing, Smith believes, is that this activity should not be constrained by anything (economic freedom).
1. Do not restrict labor mobility in any way - abolish the guild structure with its mandatory apprenticeship and the law on settlements. The worker must freely choose where to use his only capital - labor power.
2. Complete freedom of trade - external and internal, abolition of state price regulation. Freedom to trade in land, so that land passes into the hands of those who are inclined to put it into circulation. This system concerning trade was called free trade and became the policy of the English bourgeoisie.
3. Encouraging competition, prohibiting monopolies. Smith went so far on this issue that he suggested that even priests compete for more complete freedom of religion.
4. The wealth of society depends on two factors - on the productivity of labor and on the ratio between the number of those who are engaged in useful work and the number of those who are not engaged. To a greater extent, it depends on performance. In the introduction and outline of the essay, you will read how Smith explains using the examples of savage and civilized peoples. Smith goes a step further than the physiocrats and says that labor in industry, and not just in agriculture, creates value and is therefore productive. The deeper the division of labor, the higher the productivity and the larger the national product. Denying the influence of the state on the economy, Smith nevertheless speaks of the negative consequences of the division of labor, when each worker is obliged to perform only one simple operation, which will lead to the degeneration of the bulk of the people if the government does not take care of this.
5. Money is recognized only as a “wheel of circulation,” and credit and, accordingly, interest on loans are needed only for the active use of capital.
6. The labor theory of value is developed and deepened by Adam Smith. Smith emphasizes that the cost of a good is the average social cost of labor, and not the specific cost of the producer. Smith characterizes the natural and market prices of goods. Natural is the value expressed in money, while market value is formed under the influence of supply and demand. There are at least three conflicting views on value. The first - as labor costs, the second - as the quantity of goods that can be purchased for a given product, and the third - i.e. only by expressing goods in each other and value as the sum of the capitalist’s expenses, including his profit and the worker’s salary, in some industries also land rent - it follows that each of the factors - labor, land and capital - participates in the creation of value and each has in it its part - rent, profit and wages, while value is created only by labor, and rent and profit are deductions from value.
7. The theory of wages is the cost of necessary means of subsistence, but realistic additions are already given. This is not just a physical minimum of funds, it depends on:
Place and time, historical and cultural level of development of the worker. (Pay in the North is higher, if only because we are forced to spend more on warm clothes and higher-calorie foods than, for example, in Africa).
The rise in wages is driven by the struggle of workers for higher wages.
When there is economic progress in a society, the demand for labor increases, and in a market situation, the demand for goods increases their price.
8. Capital is the accumulated stock of tools, raw materials, means of subsistence and money. This can only happen to thrifty people close to asceticism. The main task for a capitalist is to accumulate capital, put it into circulation by giving work to hardworking people. The main task of the state is not to interfere with the capitalist’s accumulation of capital, but to help him in this by reducing the number of people engaged in unproductive labor - officials, the army, priests. Smith's "Investigations into the Nature and Causes of the Wealth of Nations."