Adam Smith

Long before he became a prophet of commerce, Smith grappled with human psychology. In The Theory of Moral Sentiments he argued that people possess an innate capacity for fellow-feeling. We judge our actions through an “impartial spectator” imagined within the mind, cultivating virtues like prudence and justice. Crucially, moral approval in Smith’s view springs not from divine edict but from social interaction. This emphasis on sympathy formed the ethical bedrock for his later economic system.

When Smith turned to wealth creation, he did not abandon morality; he embedded it. Commercial society could flourish, he believed, precisely because market participants usually respected contracts and sought reputational esteem. Self-interest energized production, yet it was bounded by norms against fraud and violence. Removing arbitrary guild restrictions or mercantile monopolies did not license rapacity; it freed individuals to pursue honest improvement, thereby enlarging the “great society” of mutual benefit. Modern discussions of stakeholder capitalism and corporate social responsibility still echo Smith’s insistence that markets and morals are intertwined rather than mutually exclusive.

Few friendships in philosophy proved as fruitful as that between Smith and David Hume. Their correspondence covers trade policy, human nature, and the perils of superstition, all marinated in wit and affection. Hume’s empiricism pushed Smith toward evidence-based analysis: observe prices, wages, and institutional incentives before crafting theory. Conversely, Smith’s sensitivity to virtue tempered Hume’s starker skepticism. When critics attacked The Wealth of Nations for undermining patriotic protectionism, Smith invoked Hume’s essays to show that open commerce historically promoted peace.

Their relationship also reveals the collaborative character of the Scottish Enlightenment. Ideas circulated through dinner clubs such as Edinburgh’s Select Society, where lawyers, physicians, and clerics sparred amiably. These gatherings blurred disciplines, encouraging Smith to weave jurisprudence, psychology, and history into economic narrative. The modern interdisciplinary field of political economy owes much to the Hume-Smith dialogue, demonstrating how collegial debate can seed transformative thought.

Smith’s brief image of an “invisible hand,” guiding individuals who intend only personal advantage to advance society’s interest, became a cornerstone of classical economics. Less celebrated but equally important is the example that precedes it: the pin factory. By dividing labor into specialized tasks, workers multiplied output, revealing how productivity hinges on coordination and skill development. Today’s assembly lines, software pipelines, and international supply chains scale this principle globally.

Yet Smith warned of pitfalls. Repetitive tasks could dull the worker’s mind, necessitating public education. Unchecked monopolies might distort prices and stifle innovation, justifying limited government intervention. These caveats complicate simplistic free-market slogans sometimes attributed to him. Contemporary policy debates on antitrust action, trade agreements, and automation revisit Smith’s insights, whether acknowledging him or not. Economists still parse his chapters on rent and capital in search of guidance on inequality, demonstrating how a text penned in 1776 retains diagnostic power in the 21st-century knowledge economy.

Smith never married and often wandered Glasgow’s outskirts in solitary contemplation, so absorbed that he reportedly fell into a tanning pit while musing on ideas. His students recalled lectures sprinkled with digressions ranging from ancient Greek jurisprudence to the price of herring in a Highland port - evidence of an omnivorous curiosity. Despite championing open markets, he accepted a post as Commissioner of Customs later in life, partly to support his widowed mother, illustrating a pragmatic streak that balanced theory with administrative duty.

He was charitable, quietly funding the education of relatives and the upkeep of impoverished acquaintances. Smith’s personal library, eventually exceeding 3,000 volumes, included mathematics, astronomy, and travelogues, underscoring his belief that economic phenomena cannot be divorced from wider human knowledge. Even his habit of speaking with a stutter vanished when lecturing, suggesting the transformative power of intellectual passion. These details enrich our understanding of a thinker too often reduced to a single metaphorical hand; they remind us of a multidimensional scholar whose empathy mirrored the moral sentiments he described.