The father of Economics: Adam Smith (1723-1790)

The contribution that The Wealth of Nations, published in 1776, made to the understanding of what came to be called capitalism was monumental. Smith showed how the freeing of trade can very often be extremely helpful in generating economic prosperity through specialization in production and division of labor and in making good use of economies of large scale (Sen 2009).

The book I have chosen as my book of the 18th century is An Inquiry into the Nature and Causes of the Wealth of Nations by Adam Smith. It was published in 1776 the same year as American Independence, with the author having worked on it for ten years. Smith divided Wealth into five parts which are as follows:

1. Of the Causes of Improvement in the productive Powers of Labour
2. Of the Nature, Accumulation, and Employment of Stock
3. Of the different Progress of Opulence in different Nations
4. Of Systems of political Economy
5. Of the Revenue of the Sovereign or Commonwealth

As can be seen Smith did not go for catchy titles and very much liked the word "of".

 Smith was born into a small fishing village of Kirkcaldy in Scotland. He went on to be educated at Glasgow University where he later obtained a professorship teaching moral philosophy. Little is known of the personal life of Smith who like Spinoza ordered his friends to destroy his private papers after his death. He was an integral member of the Scottish Enlightenment along many other great minds including David Hume, Robert Burns, James Watt and Sir Walter Scott.

The continuing relevance of the book can be found in the following passage taken from it:

When the people of any particular country have such confidence in the fortune, probity, and prudence of a particular banker, as to believe that he is always ready to pay upon demand such of his promissory notes as are likely to be at any time presented to him; those notes come to have the same currency as gold and silver money, from the confidence that such money can at any time be had for them (Smith 1776, p.292).

The Economical Man Himself

Many people quote Smith without having actually read him and economic fundamentalists have, especially since the Thatcher/Reagan era onwards, used his words for their own purpose. This is something that can happen to all great works. Many fundamentalists argue for free unregulated markets and laissez-faire; however in another quote from economist and Noble Laureate Amartya Sen:

Smith’s economic analysis went well beyond leaving everything to the invisible hand of the market mechanism. He was not only a defender of the role of the state in providing public services, such as education, and in poverty relief (along with demanding greater freedom for the indigents who received support than the Poor Laws of his day provided), he was also deeply concerned about the inequality and poverty that might survive in an otherwise successful market economy (Sen 2009).

The message to take from this is that Wealth is not only relevant to our times but it needs to be re-read, reinterpreted and revitalised.

This is a good concise video giving an overview of Smith by Cloudbiography.

 All 900 pages of the tome can be found here at Project Gutenberg. It should come as no surprise that Wealth of Nations is included in the 100 best Scottish books of all time. Melvyn Bragg in his book Twelve books that changed the world lists Wealth as one of his choices, and who are we to argue with Melvyn?

Reflection on research

A research facility that I am finding very useful that I neglected to mention in post 3 is the use of podcasts. I have found podcasts on the various books and authors on many networks including NPR, ABC, BBC, RTE and for this post on Econtalk. One particular podcast has been very useful and that is  In Our Time from BBC Radio 4 and I can already see that it has many podcasts concerning my next post. I have changed from using the catalogue at Swinburne to the catalogue at the State Library of Victoria, as I am finding its results more useful and it does not have as many broken links.

Reference list

Adam Smith, An Inquiry into the Nature and Causes of the Wealth of Nations, edited by R.H. Campbell and A.S. Skinner (Clarendon Press, 1976), I, II.ii.28, p. 292

Adam Smith [image], Wikimedia Commons, viewed 22 April 2012, <http://commons.wikimedia.org/wiki/File:AdamSmith.jpg>.

Abrahams, T 2005, Adam Smith - The Wealth of Nations (1776),  The List, viewed 22 April 2012, <http://www.list.co.uk/article/2826-adam-smith-the-wealth-of-nations-1776/>.

Amartya Sen 2009, Capitalism Beyond the Crisis, The New York Review of Books, viewed 22 April 2012, < http://www.nybooks.com/articles/archives/2009/mar/26/capitalism-beyond-the-crisis/>.

An Inquiry Into the Nature and Causes of The Wealth Of Nations, Project Gutenberg, viewed 22 April 2012, <http://www.gutenberg.org/files/3300/3300-h/3300-h.htm>.

BBC 2012, Radio 4 People - Melvyn Bragg, viewed 22 April 2012, <http://www.bbc.co.uk/radio4/people/presenters/melvyn-bragg/>.

Cloudbio 2011, Adam Smith, 12 December, viewed 22 April 2012, < http://www.youtube.com/watch?v=8rif2cq47c8>.

Miller, The Legendary Adam Smith Building Cat | Facebook, 2012, viewed 22 April 2012 <http://www.facebook.com/TheAdamSmithBuildingCat>.

Twelve Books That Changed the World - Wikipedia, the free encyclopedia, 2012, viewed 22 April 2012, <http://en.wikipedia.org/wiki/Twelve_Books_That_Changed_the_World>.

The father of the Enlightenment: Baruch Spinoza (1632-1677)

Of all the philosophers of the seventeenth-century, perhaps none have more relevance today than Spinoza (Nadler, S 2008). The Ethics by Baruch Spinoza is my choice of book for the 17th century. "The Ethics" is the author's principal philosophical work. It was finished in 1675 and first published after the author's death in 1677. The Enlightenment is said to have been sparked by this and his other works.

The Age of Enlightenment was a European cultural and intellectual movement whose aim was that society would move away from superstition and religious mantras and adopt reason  and science as its foundation. Seven philosophers were associated with the initial process of the enlightenment, Bacon, Descartes, Hobbes, Spinoza, Locke, Bayle and Leibniz (Israel, J p.9).

However Spinoza's contribution was arguably the most crucial in crystallising what is termed Radical Enlightenment, primarily because his thought goes further than that of the other six in undermining belief in revelation, divine providence and miracles, and hence ecclesiastical authority, and also because he was the first major advocate of freedom of thought and the press as distinct from freedom of conscience, and the first great democratic philosopher (Israel, J p.10)

  The Ethics is a book in five parts. They are

• God, nature and the meaning of substance
• Nature of the mind
• Knowledge
• Passion and action
• Virtue and happiness

"The Ethics" is not an easy read, it has a forbidding mathematical structure taken from Euclid with many definitions included and a very technical vocabulary. Full text of the work is here courtesy of Project Gutenberg.

Now bear with me here, below is a summary of The Ethics taken from The Internet Encyclopaedia of Philosophy (a peer reviewed academic resource)

 A monumental work that presents an ethical vision unfolding out of a monistic metaphysics in which God and Nature are identified. God is no longer the transcendent creator of the universe who rules it via providence, but Nature itself, understood as an infinite, necessary, and fully deterministic system of which humans are a part. Humans find happiness only through a rational understanding of this system and their place within it (Dutton, B, D 2005).

As can be seen Spinoza had a very naturalistic view of God and of the Universe.

 Spinoza rejects the traditional view of God and the world as separate from each other and the assumption of purpose, because the idea of somebody or something fulfilling a purpose implies the existence of a creator who is distinct from creation (Seidel, E 2001)

 One of the key arguments of Spinoza is that a human being should live by the guidance of reason alone and should not governed by fear or superstition. As Stephen Nadler again outlines in The Stanford Encyclopedia of Philosophy the crucial message of the work is:

  .........in showing that our happiness and well-being lie not in a life enslaved to the passions and to the transitory goods we ordinarily pursue; nor in the related unreflective attachment to the superstitions that pass as religion, but rather in the life of reason (Nadler, S 2008).

Spinoza was a Dutch Jewish philosopher. His ancestors were of Portugese descent. They were driven out of Portugal because of the Inquisition. In 1656 Spinoza was issued with a cherem, or excommunication, from his Jewish community in Amsterdam. It was life-long excommunication. The reason for this is not known but one can assume it was for his radical ideas and thinking. Like Montaigne before him his works were banned by the Catholic church and put on the Index Librorium Prohibitorum.

                                                                The Enlightened One Himself

The 17th century is considered to be Amsterdam's golden age. In this era you could have your portrait painted by Rembrandt or Vermeer, make a fortune and then lose a fortune in the tulip mania or join The Dutch East India company and travel the world.

This is a YouTube video of Spinoza's more famous quotes.

In the course of researching this blog I have come across a new term, a catablog and this is one concerning all things Spinoza.

As with "The Essays" above "The Ethics" is included in the book The 100 most influential books ever written by Martin Seymour-Smith

Notes on the research process

By and large I am enjoying the research process although I feel it is taking up too much time to the detriment of other subjects. One resource that I am finding particularly useful is to find one authoritive book on the subject and while it will not supply all required information it can deliver many good leads which can then be investigated. In Montaigne's case it was a book by Sarah Bakewell and in Spinoza's case it was a book by Jonathan Israel. Initially I am using Wikipedia and Britannica online and following on by using the Swinburne catalogue.

Reference list

Age of Enlightenment - Wikipedia, the free encyclopedia, 2012, viewed 11 April 2012, <http://en.wikipedia.org/wiki/Age_of_Enlightenment>.

iPerspective 2011,Baruch Spinoza - Top 10 Quotes, 23 October, viewed 11 April 2012, <http://www.youtube.com/watch?feature=player_embedded&v=bbTTR9UI5fI>.

Dutton, B,D 2012, 'Spinoza, Benedict De' , Internet Encyclopedia of Philosophy, viewed 11 April 2012, <http://www.iep.utm.edu/spinoza/>.

 Israel, J 2011, Democratic Enlightenment : Philosophy, Revolution, and Human Rights 1750-1790, e-book, viewed 11 April 2012, <http://swin.eblib.com.au.ezproxy.lib.swin.edu.au/patron/FullRecord.aspx?p=800816>.

Nadler, S 2012, Baruch Spinoza, viewed 11 April 2012, <http://plato.stanford.edu/entries/spinoza/>.

Necessarily Eternal, 2012, viewed 11 April 2012,
<http://perturbedintellect.typepad.com/necessarilyeternal/>.

Seidel, E 'SPINOZA.', European Judaism, vol. 34, no. 1

Spinoza  2012, [image] in Wikipedia Commons, viewed 11 April 2012,  <http://upload.wikimedia.org/wikipedia/commons/e/ea/Spinoza.jpg>.

The 100 Most Influential Books Ever Written (book) - Wikipedia, the free encyclopedia, Public domain?, viewed 12 April 2012,  <http://en.wikipedia.org/wiki/The_100_Most_Influential_Books_Ever_Written_(book)>.

The Project Gutenberg E-text of The Ethics, by Benedict de Spinoza, 2012, viewed 12 April 2012, <http://www.gutenberg.org/files/3800/3800-h/3800-h.htm>.