Adam Smith"tms Wealth of Nations examines the consequences of economic freedom. This book covers many different concepts such as the role of self-interest, the division of labour, the function of markets, and the implications of a laissez-faire economy. The essential message of the book was that man"tms self-interest would promote the economic well being of all. Smith explained his theory of self-interest in the Wealth of Nations by stating, "every man as long as he does not violate the laws of justice is left perfectly free to pursue his own interest his own way, and bring both his industry and his capital into competition with those of any other man or order of men" (Smith 93). Smith claimed that the keys to wealth are productive men, productive stock, and productive land. He also believed that the wealth of a nation consists in the well being of the mass of ordinary citizens. "Smith tried to convince people that the wealth of a nation would be promoted with vastly greater effectiveness by the obvious and simple system of natural liberty than by national planning of the mercantilist sort" (Smith 391).
"He stated that the role of government is to protect the land from f
Smith addresses the issue of education throughout his book and states "the difference of natural talents in different men is, in reality, much less than we are aware of, and the very different genius which appears to distinguish men of different professions, when grown up to maturity, is not upon many occasions so much the cause, as the effect of the division of labour. The difference between the most dissimilar characters, between a philosopher and a common street porter, for example, seems to arise not so much from nature, as from habit, custom, and education. When they come into the world, and for the first six or eight years of their existence, they were, perhaps, very much alike, and neither their parents nor play-fellows could perceive any remarkable difference. About that age, or soon after, they come to be employed in very different occupations" (Smith 431).
In the Wealth of Nations, Smith addresses who constitutes the wealth of nations and who does not contribute to the wealth of nations. Those who constitute to the wealth of nations include the capitalist, the merchant, the entrepreneur, or master manufacturer. Smith states, "He it is whose enterprise maintains colonies in Virginia and Maryland and whose individual energies epitomize the competitive drive which is the key to general character of modern commercial society" (Smith 20). Those who do not contribute to the wealth of nations include unproductive laborers, Smith says, "they number among them some both of the gravest and most important, some of the most frivolous professions: actors, musicians, politicians, poets, and even economists. Their work is service oriented and concerned with representation of material society at ideological level" (Smith 24). Women labour is not seen in Smithsonian economics, Smith is a narrowly male model of production and consumption. This concept of male-only labour is so different from today"tms reality where women labour is an important and determinant factor in the well being of the economy of both the developed as well as the developing countries.
In Wealth of Nations Smith tries to explain why people have such a weakness for the spirit of system and he says that, "the spirit of system is represented to them in all the most dazzling colors in which the eloquence of their leader could paint it. Those leaders themselves may have meant nothing but their own aggrandizement, become, many of them in time, the dupes of their own sophistry, and are as eager for this great reformation as the weakest of their followers"(Smith 320).
Smith dedicates an entire chapter in Wealth of Nations to explain how when a country is prospering, the real price of manufactured commodities tend to fall. He explains this by stating, "What the improvement and advancement of a country always does is to diminish gradually the real price of almost all manufactures. Through better machinery and greater skill, a much smaller quantity of labor goes into a particular product. Consequently, the real price of labor should rise considerably, yet the smaller quantity necessary will generally much more than compensate for the higher wage rate. But in all cases in which the real price of the material does not rise at all, that of the manufacture commodity sinks very considerably"(Smith 149). He tries to explain this by giving an example of a watch, which is now cheaper than they once were. This is because there has been a great improvement in machines that make the products and also in the manufacturer"tms methods. Distinctly, clothing is not much cheaper than it used be because of variations in the quality of wool being used. For example, fine cloth is less than a third of the price charged in 1487, while coarse cloth is also cheaper but by not as greatly a margin. The manufacture of coarse cloth used to be a very crude task, but now thanks to the invention of spinning, weaving, and the introduction of new machinery has reduced the cost of bringing cloth