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Upper Kentmere Valley, photographed January, 2011, Peter Bettess
Head of Kentmere left to right Rainsborrow Crag, Ill Bell, Froswick, Thornthwaite Crag, High Street and Mardale Ill Bell
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Economic Heroes
Adam Smith

Adam Smith, An Inquiry into the Nature and Causes of the Wealth of Nations A cheap, or even free Kindle edition is available and the text is in the public domain. This book is brilliant and it puts economics onto a completely new, and much more stable footing, compared with what had gone before. It has been said that the remainder of economics is a series of footnotes to Smith, perhaps excessive, but I would go along with that judgement.

A quote about bargaining and trading, :

(pp. 7 - 8)
' Whoever offers to another a bargain of any kind, proposes to do this. Give me that which I want, and you shall have this which you want, is the meaning of every such offer; and it is in this manner that we obtain from one another the far greater part of those good offices which we stand in need of. It is not from the benevolence of the butcher the brewer, or the baker that we expect our dinner, but from their regard to their own interest. We address ourselves, not to their humanity, but to their self-love, and never talk to them of our own necessities, but of their advantages. Nobody but a beggar chooses to depend chiefly upon the benevolence of his fellow-citizens.'

Adam Smith is often seen as an apologist for unfettered capitalism. But he is actually very scathing about big business at times. For example:

(pp. 176 - 180) with my italics:
'Merchants and master manufacturers are, in this order, the two classes of people who commonly employ the largest capitals, and who by their wealth draw to themselves the greatest share of the public consideration. As during their whole lives they are engaged in plans and projects, they have frequently more acuteness of understanding than the greater part of country gentlemen. As their thoughts, however, are commonly exercised rather about the interest of their own particular branch of business. than about that of the society, their judgment, even when given with the greatest candour (which it has not been upon every occasion), is much more to be depended upon with regard to the former of those two objects, than with regard to the latter. Their superiority over the country gentleman is, not so much in their knowledge of the public interest, as in their having a better knowledge of their own interest than he has of his. It is by this superior knowledge of their own interest that they have frequently imposed upon his generosity, and persuaded him to give up both his own interest and that of the public, from a very simple but honest conviction, that their interest, and not his, was the interest of the public. The interest of the dealers, however, in any particular branch of trade or manufactures, is always in some respects different from, and even opposite to, that of the public. To widen the market, and to narrow the competition, is always the interest of the dealers. To widen the market may frequently be agreeable enough to the interest of the public; but to narrow the competition must always be against it, and can only serve to enable the dealers, by raising their profits above what they naturally would be, to levy, for their own benefit, an absurd tax upon the rest of their fellow-citizens. The proposal of any new law or regulation of commerce which comes from this order, ought always to be listened to with great precaution, and ought never to be adopted till after having been long and carefully examined, not only with the most scrupulous, but with the most suspicious attention. It comes from an order of men, whose interest is never exactly the same with that of the public, who have generally an interest to deceive and even to oppress the public, and who accordingly have, upon many occasions, both deceived and oppressed it.'

Also Adam Smith has a wonderful dry sense of humour. He writes as follows about bounties, (or as we would say, subsidies) for the white herring fishery

(p. 359). 'Secondly, The bounty to the white-herring fishery is a tonnage bounty, and is proportioned to the burden of the ship, not to her diligence or success in the fishery; and it has, I am afraid, been too common for the vessels to fit out for the sole purpose of catching, not the fish but the bounty. '

 

Some more Adam Smith quotations:
I have never known much good done by those who affected to trade for the public good.
With the greater part of rich people, the chief enjoyment of riches consists in the parade of riches.
Science is the great antidote to the poison of enthusiasm and superstition.
The real and effectual discipline which is exercised over a workman is that of his customers. It is the fear of losing their employment which restrains his frauds and corrects his negligence.
Little else is requisite to carry a state to the highest degree of opulence from the lowest barbarism but peace, easy taxes, and a tolerable administration of justice: all the rest being brought about by the natural course of things.
Defense is superior to opulence.

 

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