Adam Smith

Camila Bauer Aug.31.2011
9-4 History
Adam Smith
Adam Smith was a philosopher who created The Wealth of Nations. The Wealth of Nations is the base of today’s economics. Economicsis the study of how people produce, buy and sell goods and services. Smith believed that the scientific inquiry could figure out anything. He also believed that if there were more Individual Liberty,there would also be more Social Harmony.
He turned his ideas into a book called “An Inquiry into the Nature and Causes of the Wealth of Nations.” When this book was published, in 1776, people in theEuropean nations, used to believe that silver and gold would get them out of a bad economy. Because there wasn’t enough supply of these, “one country’s game was another’s loss.” Because this wasn’tturning out, nations tried to focus on exporting more goods than importing. This was mercantilism.
Smith also wrote that wealth wasn’t a zero-sum game were one wins and the other one looses. He saidthat wealth came from labor. The more workers worked, then the more wealth they got. Countries economies started to grow without taking others ones away. Smith recognized three different ways of laborto get more wealth in country’s economies. The first one was self-interest. When workers sold their stuff, they did it for their own good. The result though didn’t only affect them; it also helped thewhole society because of their work for the greater good. The next way of labor Smith suggested was division of labor. Workers divided their work so they would get the double of the goods theyproduced. This way, their wealth also doubled up. The other way of labor that he suggested was free trade. The government always got into international trade. If trade had been free, then everybody wouldget benefited. Smith though, didn’t want the government to be totally out of the loop. He wanted the government to be in charge that trade stays fair.
Adam Smith impacted today’s world. He is now...