Loyola University Maryland

Adam Smith Society

Who Was Adam Smith?

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Adam Smith was an important Scottish political philosopher and economist whose famous work Wealth of Nations (1776) set the tone for work on politics and economics for many people even through today. This was, in fact, the first comprehensive effort to study the nature of capital, the development of industry and the effects of large-scale commerce in Europe.

Adam Smith's fundamental argument was that individuals should be allowed to pursue their own private economic interests as much as possible and so long as they do not violate basic principles of justice. In this way, Smith thought, they would do much more to further the public good and public interests than if the same people were to try to help the public deliberately and intentionally.

Smith called this the invisible hand of the market - although everyone is acting in their own self-interest, they are led to achieve the good of all as if by an invisible hand of economic forces. Therefore, outside interference will inevitably lead to disaster. This became known as laissez-faire economic policy.

In 1759 he published the book Theory of Moral Sentiments, where he discussed the standards of ethical conduct that hold society together. This book was a compilation of ideas and lectures from his time as a professor of moral philosophy at the University of Glasgow.

(Courtesy www.economyprofessor.com)

Portrait of Adam Smith