Scottish moral philosopher and economist, considered the father of modern political economy. A central figure of the Scottish Enlightenment and close friend of Hume. His work combines sentiment-based ethics with market theory.
Key Concepts
- Invisible hand: individuals’ self-interest, channeled through the market, generates collective benefit without central planning — a metaphor for the spontaneous order of the price system
- Division of labor: specialization of tasks multiplies productivity; the classic example of the pin factory
- Labor theory of value: the value of commodities ultimately derives from the labor embodied in their production
- Moral sympathy: the foundation of ethics — the capacity to put oneself in another’s position and evaluate actions from the perspective of an “impartial spectator”
- Impartial spectator: an imaginary figure representing balanced moral judgment, detached from self-interest
- Critique of mercantilism: a nation’s wealth is not the accumulation of precious metals, but its productive capacity and free exchange
- Free market and laissez-faire: defense of competition and criticism of monopolies, corporate privileges, and arbitrary state interventions
Influenced by
- Hume — moral sentimentalism and skepticism about state intervention
- Francis Hutcheson — ethics of moral sense (his professor at Glasgow)
- Locke and Montesquieu — liberal political theories
- Mandeville — paradox of private vices / public benefits
Influenced
- Ricardo and Mill — classical economics
- Marx — inherited (and critiqued) the labor theory of value
- Bentham — utilitarianism and calculation of collective well-being
- Modern economic liberalism and neoliberalism (Hayek, Friedman)
Works
The Theory of Moral Sentiments (1759); The Wealth of Nations (1776).
See also
Contractualism, Enlightenment and Kant