An Inquiry Into the Nature and Causes of the Wealth of Nations
by Adam Smith
An Inquiry into the Nature and Causes of the Wealth of Nations is the magnum opus of the Scottish economist Adam Smith. It is a clearly written ... Show synopsis An Inquiry into the Nature and Causes of the Wealth of Nations is the magnum opus of the Scottish economist Adam Smith. It is a clearly written account of economics at the dawn of the Industrial Revolution, as well as a rhetorical piece written for the generally educated individual of the 18th century - advocating a free market economy as more productive and more beneficial to society. The work is credited as a watershed in history and economics due to its comprehensive, largely accurate characterization of economic mechanisms that survive in modern economics; and also for its effective use of rhetorical technique, including structuring the work to contrast real world examples of free and fettered markets. A phrase often quoted and alluded to, it conveys the unintentional benefits stemming from individuals' pursuit of their own wants and needs. An example from the earlier chapters: The Butcher, the Baker, and the Brewer provide goods and services to each other out of self-interest; the unplanned result of this division of labor is a better standard of living for all three. There are two important features of Smith's concept of the "invisible hand." First, Smith was not advocating a social policy (that people should act in their own self interest), but rather was describing an observed economic reality (that people do act in their own interest). Second, Smith was not claiming that all self-interest has beneficial effects on the community. He did not argue that self-interest is always good; he merely argued against the view that self-interest is necessarily bad.