Adam Smith and Modernity (Routledge Studies in Eighteenth-Century Philosophy) 9781032293943, 9781032293950, 9781003301448, 1032293942

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Adam Smith and Modernity

This volume features 19 original chapters on Adam Smith’s conception of modernity. The contributions demonstrate the relevance of Smith as the great interpreter of modernity 250 years after the publication of The Wealth of Nations. The chapters in Part 1 focus on structural aspects of Smith’s work. They cover topics such as Smith as the theorist of a spontaneous order, the systematic dimension of Smith’s theoretical construction, and Smith’s role as a historian of economic thought. Part 2 addresses Smith’s conception of modern subjectivity between Lectures on Rhetoric and BellesLettres, Theory of Moral Sentiments, and Wealth of Nations. Here the contributors consider the figure of the Smithian “merchant” and the importance of ridicule and satire for understanding modern civility, and comment on the role of sympathy, imagination, and moral judgement in developing a sense of self, the condition of the modern man in society, and the virtue of self-command. Part 3 focuses on the crucial question of the relationship between ethics and economics discussing the link between efficiency, equity and justice, the nature of Smith’s theory of value, and the ethical connotation of Smith’s critique. Part 4 deals with topics inherent to the functional dynamics and development process of the Smithian “commercial society.” These topics include law and authority, the relationship between work and freedom, the parable of the “poor man’s son,” and the economic and political consequences of the new secular orthodoxy. Finally, the chapters in Part 5 explore themes related to history and the Smithian idea of progress. They focus on the link between trade and progress of civilization, Smith’s modern sociological vision of mass commercial societies, Smith’s judgement on “savage” and premodern societies, and the controversial question of the immanentistic or providentialist perspective from which Smith considers both the social dynamics and the historical process. Adam Smith and Modernity will appeal to scholars and advanced students on 18th-century philosophy, the history of economic thought, and the history of social and political philosophy.

Alberto Burgio is professor of the history of philosophy at the University of Bologna. He has written extensively on philosophical and political thinking from the 18th to the 20th centuries (Rousseau, Hegel, Marx, and Gramsci). He has published numerous papers in international journals and edited collections. Recent books include Gramsci. Il sistema in movimento (2014), Per Marx. Il sogno di una cosa (2018) and Crítica de la razón racista (2022).

Routledge Studies in Eighteenth-Century Philosophy

Kant and the Continental Tradition Sensibility, Nature, and Religion Edited by Sorin Baiasu and Alberto Vanzo Beyond Autonomy in Eighteenth-Century British and German Aesthetics Edited by Karl Axelsson, Camilla Flodin, and Mattias Pirholt Kant’s Critical Epistemology Why Epistemology Must Consider Judgment First Kenneth R. Westphal The Experiential Turn in Eighteenth-Century German Philosophy Edited by Karin de Boer and Tinca Prunea-Brettonet Human Dignity and the Kingdom of Ends Kantian Perspectives and Practical Applications Edited by Jan-Willem van der Rijt and Adam Cureton System and Freedom in Kant and Fichte Edited by Giovanni Pietro Basile and Ansgar Lyssy Perspectives on Kant’s Opus postumum Edited by Giovanni Pietro Basile and Ansgar Lyssy Adam Smith and Modernity 1723–2023 Edited by Alberto Burgio

For more information about this series, please visit: https://www. routledge.com/Routledge-Studies-in-Eighteenth-Century-Philosophy/ book-series/SE0391

Adam Smith and Modernity 1723–2023

Edited by Alberto Burgio

First published 2023 by Routledge 605 Third Avenue, New York, NY 10158 and by Routledge 4 Park Square, Milton Park, Abingdon, Oxon, OX14 4RN Routledge is an imprint of the Taylor & Francis Group, an informa business © 2023 selection and editorial matter, Alberto Burgio; individual chapters, the contributors The right of Alberto Burgio to be identified as the author of the editorial material, and of the authors for their individual chapters, has been asserted in accordance with sections 77 and 78 of the Copyright, Designs and Patents Act 1988. All rights reserved. No part of this book may be reprinted or reproduced or utilised in any form or by any electronic, mechanical, or other means, now known or hereafter invented, including photocopying and recording, or in any information storage or retrieval system, without permission in writing from the publishers. Trademark notice: Product or corporate names may be trademarks or registered trademarks, and are used only for identification and explanation without intent to infringe. ISBN: 978-1-032-29394-3 (hbk) ISBN: 978-1-032-29395-0 (pbk) ISBN: 978-1-003-30144-8 (ebk) DOI: 10.4324/9781003301448 Typeset in Sabon by codeMantra

Contents

Preface List of abbreviations Notes on contributors

xi xiii xv

The order of discourse

1

1 Adam Smith and spontaneous order

3

CR A IG SM I T H

2 Systems, love of system and modernity

18

J E A N - DA N I E L B OY E R

3 Adam Smith as a historian of economic thought

35

FR I TZ SÖLLN ER

The virtues of modern man

49

4 Adam Smith on self-command: utility, dignity, and sympathy

51

RYA N PAT R I C K H A N L E Y

5 The joke is not funny anymore: irony, laughter and ridicule in Adam Smith 68 SPY R I DON T EGOS

6 Smith and Hume on imagination and sympathy

89

S T E FA N O F I O R I

7 Adam Smith and the creative role of imagination K E I T H H A N K I N S A N D B R E N N A N M c DAV I D

109

viii Contents 8 Adam Smith on natural education and moral conscience

128

R ICCA R DO BON F IGLIOLI

Ethics and economics

145

9 Adam Smith and a theory of just efficiency

147

M A R Í A A L EJ A N D R A C A R R A S C O A N D M A R I A P I A PAG A N E L L I

10 The ego-alter-tertius paradigm: Adam Smith’s interaction model 161 ELEONOR E K A LISCH

11 Did Adam Smith hold a labour theory of value? Beaver and deer hunters in the early state

175

J E F F R E Y T. YO U N G

12 Endogenous ethics: Smith’s real contribution to the Enlightenment 193 A MOS W I TZ T U M

Theory and critique of commercial society

211

13 The poor man’s son: deception in Adam Smith’s case for free enterprise 213 JA M E S R. OT T E SON

14 Whose Adam Smith? The limits of law’s action

231

AG U S T Í N J O S É M E N É N D E Z

15 Work and freedom in Adam Smith: limits of historical experience

249

M A R I A LU ISA PE SA N T E

The problem of history

267

16 History without providence? Adam Smith — historian and critic of modernity

269

A L B E RT O B U RG I O

Contents  ix 17 Specialization and commercial modernity: Adam Smith as sociologist

289

LISA H ILL

18 Smith and the savages in the Wealth of Nations, or the anthropology of political economy

306

RO B E RT O M A RC H I O N AT T I

19 On the nature and causes of trade and the progress of civilization

325

L E O N I DA S M O N T E S

Index of passages quoted Index

343 349

Preface

This collection of essays does not set out to offer a particular interpretation of Adam Smith’s work. To do so would have meant forgoing the richness of an exchange of critical views reflecting a broad range of different or even contrasting interpretations. Each contribution, therefore, offers its own perspective independent of others. They are, however, linked by a common thread: an awareness of the importance of the relationship between modernity and the man who wrote The Theory of Moral Sentiments and An Inquiry into the Nature and Causes of the Wealth of Nations. Adam Smith was a modern thinker. He was also aware of what was new about modernity and of the urgent need to understand, appreciate, develop, and perhaps modify it. This is the main theme of a multidimensional thread that runs through Smith’s whole body of work with forcefulness and originality. What emerges from the essays in this collection is above all how specific the focus of Smith’s analysis is. They demonstrate that the consistent aim of his theoretical approach is to define the nature of the new era that emerged from the dying embers of feudalism. It is safe to say that not a single page in Theory, Wealth or Lectures spares any effort to elucidate the ethical, moral, psychological, anthropological, and cultural consequences of the transition to modernity and its (ambivalent) impact on social structures, the dynamics of the economy, political institutions and relations, and juridical systems. Smith was fully aware of how specific his subject was. This brings us to the second theme of this volume: the distinctive view that Smith had of his own times. He identified topics and problems that had remained unaddressed. He revealed new areas of interest and novel research perspectives. He developed original concepts and evaluation criteria. The essays in this volume investigate both of these aspects of the modernity of Adam Smith’s work in a range of different ways. They delve into the logic and epistemology of his narrative, and the fundamental themes of moral philosophy, ethics, and anthropology. They consider the big question of the relationship between economics and ethics, that is, between facts and norms. They examine the key aspects

xii Preface of modern commercial society, and Smith’s view of history, its structure and its putative purpose. Readers will evaluate this collection for themselves and need no guidance or prompting. However, one point should be noted. Three hundred years are little more than the blink of an eye against the course of human history. It, therefore, comes as no surprise that Smith, whether portrayed as the father of liberism or as a critic of its adverse consequences, is held up, even in the press, as a contemporary icon. However, if measured against human lifespans and against the frenetic pace of today’s society, three centuries seem an eternity and constitute a non-trivial test of the soundness of his theoretical legacy. A celebratory tome would be quite appropriate on the third centenary of his birth. However, this collection of essays is not some ritualistic marking of an anniversary but provides a fresh perspective on a vast and extremely complex body of work that never ceases to reveal new gems or pose new questions. The essays demonstrate that the author of The Theory of Moral Sentiments and The Wealth of Nations is not only a colossus of moral philosophy and political economy, but remains a constant companion to this day. Bologna, September 2022 Alberto Burgio

Abbreviations

AL AP Corr. ED EPS HA IA Letter Life LJ LJA LJB LRBL Review

The Principles Which Lead and Direct Philosophical Enquiries; Illustrated by the History of the Ancient Logics and Metaphysics [in EPS]: cited by paragraph: page The Principles Which Lead and Direct Philosophical Enquiries; Illustrated by the History of the Ancient Physics [in EPS]: cited by paragraph: page Correspondence of Adam Smith (ed. by Ernest C. Mossner and Ian S. Ross, 1987): cited by letter number: page Early Draft of Part of the Wealth of Nations [in LJ]: cited by paragraph: page Essays on Philosophical Subjects (ed. by William P.D. Wightman, John C. Bryce and Ian S. Ross, 1980) The Principles Which Lead and Direct Philosophical Enquiries; Illustrated by the History of Astronomy [in EPS]: cited by section.paragraph: page Of the Nature of that Imitation Which Takes Place in What Are Called the Imitative Arts [in EPS]: cited by paragraph: page A Letter to the Authors of the Edinburgh Review [in EPS]: cited by paragraph: page Dugald Stewart, Account of the Life and Writings of Adam Smith [in EPS]: cited by section.paragraph: page Lectures on Jurisprudence (ed. by Ronald L. Meek, David D. Raphael, and Peter G. Stein, 1978) Lectures on Jurisprudence. Report of 1762–3 [in LJ]: cited by section.paragraph: page Lectures on Jurisprudence. Report dated 1766 [in LJ]: cited by paragraph: page Lectures on Rhetoric and Belles-Lettres (ed. by John C. Bryce, 1983): cited by section.paragraph: page Review of Johnson’s Dictionary [in EPS]: cited by section: page

xiv Abbreviations TMS WN

The Theory of Moral Sentiments (ed. by Alec L. Macfie and David D. Raphael, 1982): cited by part.section. chapter.paragraph: page An Inquiry into the Nature and Causes of the Wealth of Nations (ed. by Roy H. Campbell and Andrew S. Skinner, 1981): cited by book.part.chapter.paragraph: page

Notes on contributors

Riccardo Bonfiglioli  received an interdisciplinary PhD in Philosophy, Epistemology, and Human Sciences in 2022 from the University of Cagliari and Paris 1 Panthéon-Sorbonne. His dissertation (What does it mean ‘to be human’? Human nature and the self in Adam Smith’s moral philosophy) explores Adam Smith’s theory of subjectivity and tries to show what it means “to be moral human beings” in Smith’s moral philosophy. Currently, his main fields of research are the modern theories of subjectivity, the philosophical sources of psychoanalytical and psychological thought, the Enlightenment’s moral ideas. He is an associate member of the Walras-Pareto Centre, University of Lausanne. Jean-Daniel Boyer is an assistant professor in the Faculty of Social Sciences in the University of Strasbourg. He is also a member of the lab for interdisciplinary cultural studies. He has done a PhD thesis on Adam Smith and has published a book in French on Adam Smith’s thought: Comprendre Adam Smith (2011). His research work deals with the birth of the political economy in France and in Great Britain in the 18th century. Alberto Burgio  is a Professor of the history of philosophy at the University of Bologna. He has written extensively on philosophical and political thinking from the 18th to the 20th centuries (Rousseau, Hegel, Marx, and Gramsci). He has published numerous papers in international journals and edited collections. Recent books include Gramsci. Il sistema in movimento (2014), Per Marx. Il sogno di una cosa (2018) and Crítica de la razón racista (2022). María Alejandra Carrasco is Full Professor of Moral Philosophy at the Pontifical Catholic University of Chile. She has published dozens of papers on the Scottish Enlightenment and particularly Adam Smith’s Theory of Moral Sentiments, both in English and Spanish. Some important ones are “Adam Smith’s Modern Reconstruction of Practical Reason” (2004); “Adam Smith: Liberalismo y razón práctica”

xvi  Notes on contributors (2006); “From Sympathy to Moral Sympathy” (2011); “Adam Smith: Self-command, Practical Reason and Deontological Insights” (2012); “Adam Smith: Virtues and Universal Principles” (2014); “La influencia de la teoría de las pasiones de Hume en el juicio moral de Adam Smith” (2020), and “Impartiality Through ‘Moral Optics’: Why Adam Smith Revised David Hume’s Moral Sentimentalism” (with Christel Fricke; 2021). Stefano Fiori is Professor of Economics at the University of Torino, Italy. His research fields focus on the history of economic thought and on the connection between philosophy, economics, and other social sciences, viewed in historical perspective. His scientific interests include pre-classical and classical economics, Austrian economics, institutional and new institutional economics, economic methodology, and theories of bounded rationality. His most recent book is Machines, Bodies and Invisible Hands: Metaphors of Order and Economic Theory in Adam Smith (2021). Keith Hankins is the R.C. Hoiles Endowed Scholar in Business Ethics and Free Enterprise and an Assistant Professor in the Smith Institute for Political Economy and Philosophy at Chapman University. His research focuses on issues at the intersection of philosophy, politics, and economics, with a special interest in how the works of David Hume and Adam Smith shed light on contemporary debates in this area. His previous work on these topics has been published in Ethics, Philosophy and Phenomenological Research, and the Journal of Politics, among other places. Ryan Patrick Hanley is Professor of Political Science at Boston College. Prior to joining the faculty at Boston College, he was the Mellon Distinguished Professor of Political Science at Marquette University, and held visiting appointments or fellowships at Yale, Harvard, and the University of Chicago. A specialist on the political philosophy of the Enlightenment period, he is the author of Adam Smith and the Character of Virtue (2009); Love’s Enlightenment: Rethinking Charity in Modernity (2017), and Our Great Purpose: Adam Smith on Living a Better Life (2019). His most recent projects include The Political Philosophy of Fénelon, and a companion translation volume, Fénelon: Moral and Political Writings, both published by Oxford University Press in 2020. Lisa Hill is a Professor of Politics at the University of Adelaide. Her areas of interest are: the social and political thought of Adam Smith and Adam Ferguson; classical Stoicism; the problem of election disinformation; questions about inclusion in electoral law and behaviour, the history of the western political tradition and political corruption. Her most recent books are: Stoicism and the Western Political Tradition,

Notes on contributors  xvii 2021 (with Eden Blazejak); Adam Smith’s Pragmatic Liberalism, The Science of Welfare, 2019 and Why and How to Regulate Political Disinformation, 2022 (with Max Douglass and Ravi Baltutis). Lisa is a Fellow of the Academy of the Social Sciences of Australia, a Program Director at the Stretton Institute for Public Policy and Research Chair of the Centre for Public Integrity. Eleonore Kalisch is a theatre, culture, and media researcher. She studied Theatre and Culture Studies, and Skavistics at Humboldt-University Berlin. She is dramatic adviser at the Landestheater Halle, the Maxim-Gorki-Theater Berlin and the Deutsches Theater Berlin. She completed her dissertation in 1990 and habilitation in 2000. Since 2000, she has held visiting professorships at Humboldt-University Berlin and at University Leipzig. Her fields of research comprise theatre and media history from Ancient Greece to the present and comparative studies in media dramaturgy. Selected publications include Sprachspiele als Machtspiele. Tadeusz Rozewicz redigiert die Moderne (1999); Konfigurationen der Renaissance. Zur Emanzipationsgeschichte der Ars theatrica (2002); Von der Ökonomie der Leidenschaften zur Leidenschaft der Ökonomie. Adam Smith und die Actor-Spectator-Kultur im 18. Jahrhundert (2006); Der drama­ turgische Blick. Potenziale und Modelle von Dramaturgie im Medienwandel (co-editor; 2014). Roberto Marchionatti is Professor Emeritus of Economics, University of Torino and fellow of the Accademia delle Scienze di Torino. He has been Visiting Scholar at the Universities of New York and Cambridge, UK, and he is life member of Clare Hall, Cambridge. He is the editor of Annals of Fondazione Luigi Einaudi. An Interdisciplinary Journal of Economics, History and Political Science. He has been a co-­ editor of History of Economic Ideas and currently is a member of its editorial board. His recent publications include Economics as Social Science. Economics Imperialism and the Challenge of Interdisciplinarity (with Mario Cedrini, Routledge, 2017), Economic Theory in the Twentieth Century. An Intellectual History, vol. I, 1890–1918 (2021) and Economic Theory in the Twentieth Century. An Intellectual History, vol. II, 1919–1945 (2022). Brennan McDavid  is an Assistant Professor in the philosophy department at Chapman University and also a member of Chapman’s Smith Institute for Political Economy and Philosophy. She works primarily in ancient philosophy with focus especially on ethics in Plato’s dialogues and epistemology across Aristotle’s corpus. In recent projects that intersect with Adam Smith’s ideas, she explores the function of markets in Plato’s political philosophy. Her work has appeared in the Journal of the History of Philosophy and Polis.

xviii  Notes on contributors Agustín José Menéndez is an Associate Professor of Political Philosophy at the Department of Philosophy and Society of the Universidad Complutense de Madrid. He is the author of Justifying Taxes, The Constitution’s Gift (co-written with John Erik Fossum) and Challenging European Citizenship (co-written with Espen D. H. Olsen). He was editor of the European Law Journal (2013–2108) and is now one of the managing editors of the European Law Open. Leonidas Montes is President of Centro de Estudios Públicos and Professor at Universidad Adolfo Ibáñez in Chile. He is the author of Adam Smith in Context (2004), co-edited with Eric Schliesser New Voices and Adam Smith (2006) and has published some papers and book chapters on Adam Smith. Leonidas was member of the Board of the International Adam Smith Society, member of the Executive Committee of the History of Economics Society (2006–2008) and chairman of the Board of Televisión Nacional de Chile (2010–2012). He was dean of the School of Government, Universidad Adolfo Ibáñez (2008–2014) and senior research fellow at the Center for the History of Political Economy at Duke University (2014–2015). James R. Otteson is John T. Ryan Jr. Professor of Business Ethics in the Mendoza College of Business at the University of Notre Dame. He also serves as the director of the Notre Dame Deloitte Center for Ethical Leadership, the Business Honors Program, and the Business Ethics and Society Program. He received his BA from Notre Dame and his PhD from the University of Chicago. His most recent books are Honorable Business (2019) and Seven Deadly Economic Sins (2021). Maria Pia Paganelli  is a Professor of Economics at Trinity University. She works on Adam Smith, David Hume, and 18th century monetary theories. She wrote The Routledge Guidebook to Adam Smith’s Wealth of Nations (Routledge 2020), and co-edited the Oxford Handbook on Adam Smith (2013) and Adam Smith and Rousseau (2018). She served as the Vice President of the History of Economics Society and as the book review editor for the Journal of the History of Economic Thought. She is the current President of the International Adam Smith Society, and the president-elect of the History of Economics Society. Maria Luisa Pesante has taught historical disciplines at the University of Turin, Faculty of Political Sciences. She has published more than 40 essays on socio-economic debates, mainly about the 17th and 18th centuries in England. Her book Come servi. Figure del lavoro sala­riato dal diritto naturale all’economia politica (2013) is a reconstruction of the reasons why authors (lawyers, philosophers, political economists) in those centuries found it very difficult to conceptualize wageworkers as distinct from slaves, and to envision better prospects

Notes on contributors  xix for them. She is currently working on the historiographical debate on free and unfree labour. Craig Smith is the Adam Smith Senior Lecturer in the Scottish Enlightenment in the School of Social and Political Sciences at The University of Glasgow. He works on the moral and political philosophy of the Scottish Enlightenment. His publications include Adam Ferguson and the Idea of Civil Society: Moral Science in the Scottish Enlightenment (2019) and Adam Smith (2020). He was co-editor (with Christopher J. Berry and Maria Pia Paganelli) of The Oxford Handbook of Adam Smith and editor (with Alexander Broadie) of the second edition of The Cambridge Companion to the Scottish Enlightenment. Fritz Söllner is head of the Department of Public Finance at the Technical University of Ilmenau, Germany. He worked as a junior lecturer at the University of Bayreuth, Germany and as a John F. Kennedy Research Fellow at Harvard University. His research interests include, besides the history of economic thought, environmental economics and the economics of migration. Among more recent publications are the textbook Die Geschichte des ökonomischen Denkens (5th ed., 2021, Springer-Gabler, Berlin, in German) and the papers “The Use (and Abuse) of Robinson Crusoe in Neoclassical Economics” (History of Political Economy, vol. 48 [2016], no. 1, pp. 35–64) and “Towards a Rational Migration Policy” (Analyse und Kritik, vol. 40 [2018], no. 2, pp. 267–91). Spyridon Tegos is an Assistant Professor of Early modern philosophy at the University of Crete, Greece. In his research, he concentrates on the history of moral and political philosophy (Scottish and French Enlightenment). He is currently preparing a book on the classical French sources in early modern theater and belles-lettres that inspired early Scottish liberalism (David Hume, Adam Smith) and, in its aftermath, French liberalism (Germaine de Staël, Alexis de Tocqueville) with respect to the social and political relevance of “middling rank” (middle class) manners. He holds a PhD from the University of Paris X-Nanterre with a thesis on the concept of social sentiments (friendship, sympathy, compassion) in early modern political philosophy. Recent publications include “Pre-Weberian Charismatic Leadership and Aesthetics of Deference in the Scottish Enlightenment,” in Tamas Demeter & Eric Schliesser (eds.), Sociological Heritage of the Scottish Enlightenment, Routledge (forthcoming). Amos Witztum  is a Professor of Economics and currently a Research Associate at the Centre for the Philosophy of the Natural and Social Sciences at the London School of Economics. His research interests surround the relationship between ethics, economics, and society, which he conducts through the study of both current issues and the

xx  Notes on contributors history of economic analysis. Recently, he published a two-volume critical examination of modern economics (The Betrayal of Liberal Economics), which offers an alternative conceptual framework to modern analysis and is currently working on the third volume that deals with the social and political consequences of his critique of economics. He had been the book review editor and editor in Economica and served on the board of various other journals as well as involved in the creation of three academic institutions. Jeffrey T. Young is Emeritus Professor of Economics at St. Lawrence University, Canton, New York, USA, where he taught from 1980 to 2018. Prior to that, he taught at Marshall University and the University of Colorado at Denver. He received his PhD in economics from the University of Colorado in 1975, where he wrote his doctoral dissertation under Kenneth Boulding. Since retiring from St. Lawrence University, he has held visiting and adjunct positions at Gordon College, a Christian liberal arts college in Massachusetts, USA. His research interests include the economics and moral philosophy of Adam Smith and David Hume on which he has published extensively. He also has a long-standing interest in classical and Marxian value theory. He edited the Elgar Companion to Adam Smith (2009).

Editor’s note The contributors to this volume are from different parts of the world, providing a global perspective on Adam Smith’s work. We have retained the original spelling conventions and linguistic usage of each individual author.

The order of discourse

1 Adam Smith and spontaneous order Craig Smith

1 Introduction The invisible hand is a phrase that has become inextricably linked to the name of Adam Smith. There are perhaps as many interpretations of the nature of the invisible hand as there are scholars of Smith, or indeed as many as the number of people who have heard of Smith and think that they know what the invisible hand is at second or third hand by way of their Econ101 lecturer and Paul Samuelson’s textbook (Kennedy, 2014). In this chapter, I return to my work of twenty years ago that tried to introduce some conceptual clarity into the discussion of this most elusive of Smithian terms. Then, as of now, I will place Smith’s thinking within a conceptual tradition of theories interested in unintended consequences or spontaneous order. After outlining my proposed conceptual schema, I will examine some of the more significant recent discussions of the invisible hand, chiefly those who read Smith’s work as dependent on theological notions of providence, seeing the invisible hand as a metaphor for a social theory with an important and active role for the hand of God. I will conclude with a brief engagement with readings of Smith’s investment in elucidating spontaneous order explanations as being driven by a desire to inform the decisions of legislators through “a science of the legislator”. Both of these, I will suggest, have important flaws. I will argue that Smith’s analysis has no active role for providence, instead relies on social scientific explanation, and that his acute awareness of the unintended consequences of social actions undermines interpretations that seek to read him as favouring a more interventionist role for the legislator based on social scientific pattern predictions of unintended consequences.

2 Metaphors There is little doubt that Adam Smith, and his colleagues in the Scottish Enlightenment, were interested in the role of unintended consequences and the spontaneous formation of order in their accounts of social change (Barry, 1982; Hamoway, 1987; Berry, 1997; Carey, 2017). The

DOI: 10.4324/9781003301448-2

4  Craig Smith debate is over how a thinker like Smith understands what we have come to call, following F. A. Hayek and Michael Polanyi, spontaneous order theories (Polanyi, 1951; Hayek, 1967, 1979, 1993; Jacobs, 1998, 2000; Petsoulas, 2001). In earlier work, I attempted to introduce some conceptual clarity to the discussion of this type of social and historical explanation by stipulating a vocabulary that allows us to see the links between various closely related, yet distinct, locutions (Smith, 2006). I argued that spontaneous orders are a subset of the more general explanations of unintended consequences that are concerned with the analysis of complex social orders. Within spontaneous order analysis, the social change that leads to the formation of order is often understood as an evolutionary process that can be retrospectively examined and explained in a neutral manner. Thus the results of unintended consequences and of evolution can be malign or benign according to some favoured evaluative principle. I then suggested that we use Adam Smith’s metaphor of the invisible hand as a helpful name for the cases where an author suggests that the spontaneous order that arises from unintended consequences or evolves over time, produces beneficial results. Crucially, I want to make the claim that there are two stages to this sort of analysis. The first stage describes the generation of the spontaneous order and the second provides an explanation of why that order produces beneficial results aligned with some chosen normative criterion. That is to say that the beneficial outcome can be explained, but is not explained by reference to the intentions of the actors involved. My aim here is to introduce greater clarity to the sorts of social theoretical explanation that Robert Nozick referred to as “invisible-hand explanations” (Nozick, 1974: 20–1). The sort of analysis captured by this conceptual vocabulary pervades Smith’s work. From his discussion of the development of science and language to his account of the fall of feudalism and the emergence of the division of labour, Smith provides accounts that chart long chains of unintended consequences rather than deliberate acts by designing individuals. Smith’s rejection of the possibility that a society could be designed, or could be inaugurated by a social contract demonstrates that the tradition to which he belongs was one that sought to theorise history to understand the development of the institutions that we have inherited from it (LJA, v.115: 316). Smith uses the phrase the invisible hand three times. The phrase first appears in his essay on the History of Astronomy, an early essay that Smith saved and was published posthumously. Macfie argued that this appearance, where Smith talks of how the believers in polytheistic religions attributed irregular events to the “invisible hand of Jupiter” (HA, III.2: 49) is different from the latter two appearances of the phrase in The Wealth of Nations and The Theory of Moral Sentiments. Macfie suggested that this was a result of differing conceptions of the deity: a

Adam Smith and spontaneous order  5 pagan god who intervenes to disrupt order as opposed to a Christian God whose providential plan guarantees order. I will return to the religious interpretation below, but for the moment, let us accept Macfie’s point that there is sufficient similarity between the invisible hand in TMS and WN for us to see them as referring to the same phenomenon (Macfie, 1971: 595–9; see also Macfie, 1967). In TMS, Smith argues that the rich are subject to the same bodily constraints as the poor and are compelled to use their wealth to purchase the product of others’ industry in the form of material goods. The intended result of the rich is to expend their wealth on goods that provide comfort and which allow them to display their wealth. The intention of the poor is to survive by selling their labour. When these come together, the beneficial result is economic growth and a provision of subsistence and material wealth that benefits the whole of society. They consume little more than the poor, and in spite of their natural selfishness and rapacity, though they mean only their own conveniency, though the sole end which they propose from the labours of all the thousands whom they employ, be the gratification of their own vain and insatiable desires, they divide with the poor the produce of all their improvements. They are led by an invisible hand to make nearly the same distribution of the necessaries of life, which would have been made, had the earth been divided into equal portions among all its inhabitants, and thus without intending it, without knowing it, advance the interest of the society, and afford means to the multiplication of the species. When Providence divided the earth among a few lordly masters, it neither forgot nor abandoned those who seemed to have been left out in the partition. These last too enjoy their share of all that it produces. (TMS, IV.i.10: 184–5) The invisible hand here is a metaphor for the mechanism by which a benign outcome, one that is in society’s interests in general, can be produced by the self-regarding actions of individuals. The distributive outcome of the interaction of the individuals concerned was not a part of the intentions behind their actions. Moreover, the explanation does not depend on any active role of the deity, and the explanatory thrust of the passage does not rely on a providential plan. While Smith does mention providence in the following sentence, the reference takes the form of a rhetorical platitude about the unequal division of property. What Smith does is provide a conceptualised explanation of how exchange leads to a meta-level order that can be assessed, by a favoured normative criterion, as beneficial. We should be very clear here that the explanation offered by Smith is intended to dispel any mysticism about the origin of the beneficial outcome. He explains to us how the process works, then uses

6  Craig Smith the metaphor of the invisible hand as a placeholder that frees him from repeating the exposition. In the WN, the invisible hand passage again examines a case where the intention of the actors (their own profit) unintentionally leads to the socially beneficial outcome of the wealth of the nation. Here, the point is that deliberate attempts to maximise national wealth through mercantile protectionism are unnecessary as most of the time, most people will choose to invest in what they know, close to home, where they have a better sense of the security and likely return from their investment. The intended result is their own gain, the unintended outcome is the efficient investment of individual capital to increase the wealth of the nation. By preferring the support of domestick to that of foreign industry, he intends only his own security; and by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention. Nor is it always the worse for the society that it was no part of it. By pursuing his own interest he frequently promotes that of the society more effectually than when he really intends to promote it. I have never known much good done by those who affected to trade for the publick good. (WN, IV.ii.9: 456) Here again, there is nothing mysterious about the application of the invisible hand as a metaphor. Smith has explained why the beneficial social outcome is produced and why its production does not depend on that outcome being a part of the intention of the actors involved. In both invisible hand passages, Smith uses the phrase to refer to some mechanism (the hand) that acts to produce benign results through the medium of unintended consequences. Whether the result is the distribution of subsistence or the support of domestic industry, the result is a socially beneficial order arising from the unintended consequences of the social actions. In both examples, such explanations are identified retrospectively because the theorist observing them is describing a pattern that emerges from the actions of individuals acting within a particular social context: actors who need not be aware of the order let alone its beneficial nature. In both of these cases, Smith uses the term invisible hand in reference to phenomena that he has already explained rather than as an appeal to God as actively responsible for the order or providence as a guarantor of positive outcomes. In both of these cases, he uses language that indicates that the processes produce benign results through the media of unintended consequences. To say this is not to say that such mechanisms always operate, that they never fail, that they are divinely sanctioned or

Adam Smith and spontaneous order  7 that they are associated with any particular set of ideological beliefs. Moreover, as Gavin Kennedy pointed out, neither of these metaphorical uses of the invisible hand refers to “the market” (Kennedy, 2009). That is to say, Smith’s uses of the metaphor do not involve a claim that the results of market exchanges are always socially beneficial. However, in the WN example, we see an additional argument emerge to underline Smith’s point. At the end of the passage, Smith suggests that in contrast to the operation of unintended consequences in this case, the deliberate action of individuals intended to bring about the same beneficial order is less likely to succeed (a point we shall return to below). We should be careful to note that this is not a sweeping claim that unintended order is always superior to intended order. Instead, it is the more modest claim that, given Smith’s explanation of the particular situation, the process of unintended consequences is more likely to produce the benign order than the affectation of a deliberate desire to attain the same results. To be clear: the recognition that certain unintended consequence processes produce beneficial results does not commit Smith to a position that views all unintended consequences as good and all deliberately pursued consequences as bad. For the invisible hand to act as a placeholder for benign unintended consequences, we need to contrast it, not just with orders that result from deliberate action, but also with unintended consequences that produce malign orders. We can see many examples of these in Smith’s work as well. In Book V of the Wealth of Nations, Smith famously describes the stultifying effects of the division of labour on the labouring poor (WN, V.i.f.50: 782). What we see, then, is a willingness to recognise the reality of a distinction between benign and malign unintended consequences. While the theoretical mechanism of explanation remains the same, the normative assessment of the outcomes differs. There is widespread agreement that Smith’s invisible hand is a metaphor, a term that he uses as a shorthand to avoid repeating the details of complex explanatory discussions, an allusion that allows the reader to grasp the idea that he is discussing and that he has taken several pages or paragraphs to explore (Heath, 2014). The disputed interpretations arise when we push beyond that into an attempt to say that Smith uses the metaphor deliberately and consistently or that the concept captured by the metaphor is significant in Smith’s thinking. The first of these is, I think, the easiest to demonstrate. As we have just seen, the two invisible hands of the TMS and WN bear sufficient similarity to each other and the phrase is repeated in the same locution – “led by an invisible hand” – in such a way as to suggest that whatever Smith was doing, he was using the same phrase to illustrate the same phenomenon. The second point, that the idea captured by the phrase invisible hand, is significant within Smith’s thinking is also, in my view, easily demonstrated. As Stefano Fiori argues, the invisible hand “captures a logic of

8  Craig Smith discourse that pervades much of Smith’s work” (2021: 5). The profusion of unintended consequence explanations, of discussions of social order arising unintentionally from practice, and of gradual long-term social change arising from the unanticipated outcomes of the actions of individuals, is obvious to even the casual reader of his work. Indeed, unless one is motivated by a desire to suggest that asserting the presence of such accounts is somehow to deny that there are other passages where Smith reflects on intended consequences and deliberate attempts to reform or design institutions (it patently is not), then it becomes difficult to understand what the fuss is about. A more significant objection is that the critical focus on the phrase has been overblown. Emma Rothschild’s suggestion that the invisible hand was a throwaway, mildly ironic, expression of humour that has unhelpfully come to the fore is based on the idea that the invisible hand is ‘un-Smithian’ as it implies a supernatural explanation. Rothschild does not read Smith as a thinker who depends on supernatural or theological argument in any important sense and instead sees him as much closer to the nascent social science that developed during the Enlightenment. And so the grounds for her rejection of the significance of the term invisible hand are, partly at least, that it sounds like providence and providence is not Smithian. Somewhat unhelpfully, I agree with this broad conclusion, but for entirely different reasons from those advanced by Rothschild (2001: 123–4; 1994). Moreover, my definitional approach also squares with what Rothschild identifies with the “modern” as opposed to Smithian invisible hand that she characterises as having three components: “the unintended consequences of actions”, “the orderliness of the ensuing events” and “the beneficence of the unintended order”. My disagreement with Rothschild lies in her belief that Smith’s use of the invisible hand metaphor did not display all three of these conditions (Rothschild, 2001: 138).1 The two specific examples discussed above demonstrate that Smith’s invisible hand passages can indeed be read in just this fashion. This leaves us with the idea that the invisible hand is obviously dependent on a theological conception of providence.

3  The hand of God The strongest version of a providentialist reading of Adam Smith appears in Lisa Hill’s essay on Smith’s “hidden theology” (Hill, 2001). 2 Hill was responding to what she saw as excessively secularist readings of Smith attacking writers like Spencer Pack (1995), who regard Smith’s use of theological language as merely rhetorical. Hill argued that in certain key ways, Smith’s thinking simply does not make sense unless we understand the central and active role of God. For Hill Smith’s efficient (social scientific) and final (theological) causes are much more closely linked than

Adam Smith and spontaneous order  9 we think. So closely in fact that his invisible hand arguments are almost incredible without the presence of a providential plan. Take the following claim: Smith’s insistence […] on the benevolence of the social order would only constitute a commission of the naturalistic fallacy were his system genuinely profane whereas under a Providential regime there is good cause for unbounded optimism and a belief that “whatever is, is right.” By what other means could Smith possibly have reconciled his claim that universal happiness and prosperity results from the free play of avarice and other voluptuous desires? The competitive market only delivers the greatest social good because of the “invisible hand” of Providence (Stikkers 1987: 236). In the absence of an organizing Providence, Smith’s optimism is unwarranted if not inexplicable. (Hill, 2001: 12–3)3 For Hill, the invisible hand becomes the unifying force of Smith’s work. Providence becomes the controlling force that ensures that human happiness is the outcome of social interaction. Absent divine intervention, the idea that happiness emerges from the pursuit of self-interest is literally incredible. Thus “Smith’s universe is logically dependent upon a divine invisible hand” (Hill, 2001: 22).4 The problem with this analysis is that it depends on taking some of Smith’s more optimistic descriptions of the link between the natural order and human happiness from TMS, seeing them as substantive claims rather than rhetorical polish, and then applying them tout court to his analysis of society and the market. Reading the invisible hand as God’s hand involves moving beyond the analysis in terms of efficient causes that Smith provides for us and attributing a direct role to providence because it just so happens that humans behave in this way in these circumstances. But there is no need to do this. Smith works from basic observations about facts of human behaviour and tells us how those outcomes emerge distinct from the intentions of the actors. There is no mystery to it; it is simply an explanation of what is there. Smith’s method does not require him to provide deeper accounts of why we are as we are and the world is as it is. Nor does it require him to assert that outcomes will always be beneficial. Smith is not Pangloss. For Smith, the explanation of the entire universe is, as Hill rightly notes, beyond humanity and to be left to God. But identifying the operation of unintended consequences and the generation of beneficial spontaneous orders in particular cases does not require a theodicy in order to be coherent. Ultimately, then, when we explore the two invisible hand passages in TMS and WN, we find that Knud Haakonssen was correct; what appear to be teleological and religious arguments in Smith are, on

10  Craig Smith closer inspection, based on efficient causal analysis of empirical observations drawn from history. 5 A more contextualist reading is offered by Peter Harrison who has pointed out that the term invisible hand had a commonplace and relative fixed meaning in sermons and religious writing in the period leading up to Smith’s use of it (Harrison, 2011). His argument is that Smith’s readers would have recognised the phrase as one with a substantive set of meanings linked to providential arguments and the argument from design. Such providential arguments, the idea that God’s plan was directly guiding specific actions in history, or that God’s general providence created a rule-governed natural world of creation that was suited to the good of his creatures, were commonplace views. This means that Smith’s readers would have understood it to refer to providence, and that because Smith uses it without explanation of another meaning, so Harrison argues, this invites the presumption that Smith acquiesced in the established providential understanding. While concluding, Harrison considers the view that the mentions of providence are not statements of belief in providence, but are instead examples of Smith pointing out the human propensity to offer explanations. This, it seems to me, is the most reasonably way to read these passages. Adam Smith’s personal views on religion are universally recognised to be opaque, so when we consider whether the invisible hand is the hand of God, we need to look at the substance of what Smith is saying (Oslington, 2011; Kennedy, 2013; Carrasco, 2016; Graham, 2016). The clearest recent work on Smith’s discussion of religion, by Ryan Patrick Hanley and Colin Heydt, demonstrates that Smith’s discussion of religion is marked by a naturalistic analysis of the moral psychology of religion (Hanley, 2015; Heydt, 2017). Smith’s analysis explains why humans are religious in terms of psychological function. Religion is “natural” in the sense that it performs an important psychological role in calming our minds and rendering the universe explicable to us. What Smith provides is a “psychological genealogy” (Heydt, 2017: 80) of belief in a designer and in providence. He remains scrupulously neutral on whether the beliefs so generated are true. It is at this point that we can return to Smith’s invisible hand of Jupiter because it is in this passage that Smith explains to us why it is and how it is that polytheistic religious beliefs are developed. Such beliefs calm our anxiety by making the apparently inexplicable fit into our established patterns of belief. So it is at precisely the point where the marvellous disconcerts us that we are prone to deploy religious reasoning. The first appearance of the invisible hand is part of Smith’s naturalistic explanation of why people develop the concept of providence. He is explaining to us why we need to think of outcomes as though they were produced by an invisible hand, but he is doing so in a genealogy that ultimately explains such a belief as a response to ignorance.

Adam Smith and spontaneous order  11 The point at stake is whether God is needed to make sense of the fact that our natural dispositions lead us to act in ways that are morally beneficial without that being part of our intentions. To say that it is as if we are led by an invisible hand is how it might well strike someone who sees the outcomes of unintended consequences as positive and cannot explain them. But Smith can explain how the positive outcomes arise, and in so doing, he does not depend on providence, general or special. A.L. Macfie’s distinction, between a pagan invisible hand of Jupiter that disrupts the course of nature and a Christian God whose invisible hand guides a providential order, points us towards another issue in our conceptual vocabulary: the idea of spontaneous disorder. This term has been explored by Michelle Schwarze and John T. Scott (Schwarze & Scott, 2015).6 They point out that there are many cases where human actions combine to disrupt existing orders and create chaos. Disruption of the social order of this sort needs to be considered under two headings in our schema. First, in situations where an established order is disrupted and replaced by a new, malign, order; and second, in situations where an established order is disrupted by unintended consequences and replaced by no discernible social order. The second point here is most easily addressed. There is no good reason why a subset of theories of unintended consequences that explain the generation of beneficial social orders in some cases also needs to provide an account of the absence of order or the absence of benign order in other cases. More than this, however, accepting that unintended consequences analysis can issue in conditions of disorder and malign order shows that the unintended consequences analysis is not in any straightforward sense dependent on ideas of beneficent providence. This is because it does not always produce order, let alone benign order. Schwarze and Scott use the example of resentment and justice and rightly show how Smith explains our capacity to cope with unrecognised injustice in this life by appealing to providence, to an idea that all will be made right in the future life, or that our suffering in this life forms a part of some larger plan that is beyond our ken. In so doing, they point out that Smith’s account of this tendency towards providential explanation is strictly naturalistic and explains how people come to form a belief about eternal justice that consoles their disappointments in this life. That nature has made us what we are and that the world is as it is are starting points for Smith. The generation of providential systems or ideas about heaven is explained by Smith as the development of how we try to understand the world, and this is distinct from, and plays no active role in, the explanation of the beneficial outcomes of the two invisible hand passages.7 It is precisely our inability to control those orders that emerge from our interaction with others that lead us to understand the world in providential terms (Davis, 1989). The point is that, as Smith noted in EPS, humans need to find ways to understand the world, and providence is a

12  Craig Smith conceptual framework that we can use to do that, just as the consolation of heaven is a way in which we can deal with tragedy in this life. Smith gives us a naturalised account of the development of these beliefs, just as he gives us detailed explanations of how each of the invisible hand and unintended consequences arguments can be retrospectively explained. There is no conceptual space for God in this as anything other than a rhetorical frame.

4  The science of a legislator One of the recent trends in Smith’s scholarship has been to challenge those who see him as a defender of laissez faire on the basis of his support for “the invisible hand”.8 The idea that this proves a problem for reading Smith as a spontaneous order thinker who uses the invisible hand in the particular fashion that I have outlined is understandable. That Smith saw the reality of malign unintended consequences such as the impact of the division of labour on workers and recommended deliberate action to address it in the form of encouraging education is indisputable. But it is equally true that Smith never says that a commercial society will always produce benign unintended consequences. Even when he describes the system of natural liberty, he accepts that it is only the best practicable given human nature and the circumstances of society. Moreover, even then, he does not expect it to be instituted in full owing to the many interests against it. My point here is simply to note that a belief in the benignity of some spontaneous orders does not commit one to a belief in the necessary benignity of all of the orders generated by the unintended consequences of social interaction in a particular form of society. This, more than anything is what divides Smith from a providential account. He has no need to try to make sense of apparently malign outcomes in terms of some Panglossian system that it will all be for the best in the long run. There is no demand that we submit ourselves blindly to “the market”. Theodicy, in this sense, does not matter to Adam Smith. In conclusion I want to explore two recent interpretations of Smith’s interest in spontaneous order, those by Eric Schliesser (2017) and Stefano Fiori (2021). Both writers accept the view outlined by Fiori that the invisible hand is a metaphor for the unintended generation of order in society. Where they differ is on the implications that invisible hand explanations have for the capacity of our social science to inform the decisions of legislators. For Schliesser: “a Smithian Invisible Hand process is a relatively short-term process in which an agent produces unintended, and, to him or her, unknown consequences;” these “consequences are, in principle, knowable to the right kind of observer (either theoretically informed or by accumulated common sense) at the time”. These are to be contrasted to what Schliesser calls Smithian Social Explanations, which “involve cases where the consequences are visible or knowable only after the fact.

Adam Smith and spontaneous order  13 Generally they take place over much longer amounts of time than any given invisible hand process” (Schliesser, 2017: 235). Schliesser’s claim is that there are short-term and long-term unintended consequence arguments in Smith, that the invisible hand passages are shorter term and as they are more temporally bound, are more susceptible to recognition by the actors involved in producing them. This serves one of Schliesser’s wider aims, to argue that even Smith’s recognition of the invisible hand does not detract from a reading of him as more sympathetic to the use of social science as a guide to the actions of legislators. Schliesser’s point is that the merchants in the WN invisible hand example can have it explained to them and then make the wealth of the nation part of their intention when they pursue their self-interest (Schliesser, 2017: 247). There are two distinct problems with this. The first is a point that we noted above when we discussed the WN invisible hand passage. Smith explicitly rejects the idea floated by Schliesser. Recall: By pursuing his own interest he frequently promotes that of the society more effectually than when he really intends to promote it. I have never known much good done by those who affected to trade for the publick good. (WN, IV.ii.9: 456) This sounds like a counsel to avoid the possibility that Schliesser outlines. More significant, however, is Fiori’s observation that the TMS invisible hand passage is much closer to the sort of long-term explanation that Schliesser should regard under his other heading of Smithian Social Explanation. If this is true, his schema for distinguishing the invisible hand from other forms of Smithian explanation breaks down. As Fiori notes, Schliesser admits that Smithian Social Explanations can include invisible hand explanations as sub-components and, in doing so, brings his two forms of Smithian Social Explanation closer together (Fiori, 2021: 198–9). In the schema suggested here, we have used the benignity of the order as the qualifier for our use of the metaphor of the invisible hand. This also allows us to recognise that such explanations can invoke longer- or shorter-term processes, allowing greater flexibility to the reach of our conceptual vocabulary.

5 Conclusion My aim in this chapter has been to suggest that the term invisible hand is helpful in understanding Adam Smith’s thinking, and is perhaps even more helpful in parsing the tradition of spontaneous order that has developed, inspired by his work. In this sense, I think that there is more mileage in the invisible hand than some have suggested (Samuels, 2011). There are two tendencies in Smith scholarship that have leant against this

14  Craig Smith claim. The first is that invisible hand explanations depend on theological arguments that either render them unconvincing to modern readers or render them ‘un-Smithian’ and so poor interpretative moves. I hope to have cast some doubt on this by the development of a clearer conceptual schema and close analysis of the texts in question. The second issue is a tendency to see Smith’s more laissez faire enthusiasts as stressing the spontaneous order elements of his thinking in order to attack state intervention while ignoring the many passages where he advocates deliberate reform by the legislator. While this is doubtless true to some extent, I hope to have shown that it is not necessarily true. A closer appreciation of Smith’s use of spontaneous order arguments shows us that they do not militate against all deliberate political action unless Smith provides us with an additional reason why we should prefer spontaneous order to deliberate legislation. It is also worth noting that this schema does not rule out the possibility that a designed order could issue in unintended consequences that would themselves constitute a spontaneous order, nor does it of itself assert the impossibility or sub-optimality of either unintended or designed social orders.

Notes 1 It is worth noting that one of Rothschild’s reasons for rejecting the use of the metaphor as un-Smithian, is that such explanations posit a theorist with privileged universal knowledge who is able to identify the hand, while the individuals guided by it remain ignorant of its effects (Rothschild, 2001: 124). I argue that the invisible hand is always a retrospective explanatory device whether wielded by the agents involved or by social scientists (Smith, 2006: 83). 2 Others who link Smith’s interest in spontaneous order to religion include: Martin, 1990; Kleer, 1995; Otteson, 2002: 234–5; Denis, 2005. 3 The essay by Kenneth W. Stikkers to which Hill refers is: “Max Scheler’s Contributions to Social Economics”, Review of Social Economy, vol. 45 (1987), no. 3, pp. 223–42. See also Hill, 2020: 59: “A beneficent pattern orchestrated by Providence and geared towards human happiness and material prosperity is formed by the uncoordinated, self-regarding acts of individuals”. 4 In a recent article, Jessica Whyte has suggested that even purported secular accounts of spontaneous order such as that of F.A. Hayek depend upon a quasi-religious faith that motivates submission to forces beyond our understanding and control (Whyte, 2019). 5 Smith, as Haakonssen argues, is a theorist of efficient causes and an explainer of the belief in the final cause (Haakonssen, 1981: 104). 6 James M. Buchanan (1977) was among the first to note the possibility of spontaneous disorder, discussing a situation where unintended consequences produce no order or where unintended consequences disrupt an existing order. Daniel Luban, in a discussion of spontaneous order in the work of F. A. Hayek, goes further than this and suggests that any set of actions will have unintended consequences that “will form patterns that might (from

Adam Smith and spontaneous order  15 the proper perspective) appear orderly” (Luban, 2020: 70). This is implausible. Some actions will not have unintended consequences; some will disrupt established orders, while some actions will create disorder, and some will create bad orders. The fact that a pattern or order arising from unintended consequences can be identified in a riot or a gulag, to use Luban’s example, does not discount the absence of order in other cases. Luban generally finds the Scottish Enlightenment version of spontaneous order analysis more attractive because of its ‘untidiness’ (Luban, 2020: 78) and openness to perverse and malign outcomes. This is precisely the point that I have been labouring to bring to the fore in this conceptual schema. 7 As Stefano Fiori would have it: “the role of the invisible hand is not reducible to Divine action” (Fiori, 2021: 89). 8 Schwarze and Scott (2015: 464) read “Smith as a theorist of spontaneous order who is nonetheless well aware of the limitations and costs of these processes”.

References Barry, N., 1982, “The Tradition of Spontaneous Order: A Bibliographical Essay”, Literature of Liberty, vol. 5, no. 2, pp. 7–58. Berry, C.J., 1997, Social Theory of the Scottish Enlightenment, Edinburgh University Press, Edinburgh. Buchanan, J.M., 1977, Freedom in Constitutional Contract: Perspectives of a Political Economist, Texas A&M University Press, College Station, TX. Carey, T.V., 2017, “Adam Smith’s Invisible Hand: A Brief History”, The Adam Smith Review, vol. 9, pp. 88–104. Carrasco, M.A., 2016, “The Role of God in Adam Smith’s Theory of Moral Sentiments: Necessity or Convenience?”, in R. Lazaro & J. Seoane (eds.), The Changing Faces of Religion in XVIIIth Century Scotland, Georg Olms, Hildesheim, pp. 206–25. Davis, J.B., 1989, “Smith’s Invisible Hand and Hegel’s Cunning of Reason”, International Journal of Social Economics, vol. 16, no. 6, pp. 50–66. Denis, A., 2005, “The Invisible Hand of God in Adam Smith”, Research in the History of Economic Thought and Methodology, vol. 23, no. 1, pp. 1–32. Fiori, S., 2021, Machines, Bodies and Invisible Hands: Metaphors of Order and Economic Theory in Adam Smith, Palgrave Macmillan, Cham, Switzerland. Graham, G., 2016, “Adam Smith and Religion”, in R.P. Hanley (ed.), Adam Smith: His Life, Thought, and Legacy, Princeton University Press, Princeton, pp. 305–20. Haakonssen, K., 1981, The Science of a Legislator. The Natural Jurisprudence of David Hume and Adam Smith, Cambridge University Press, Cambridge. Hamoway, R., 1987, The Scottish Enlightenment and the Idea of Spontaneous Order, Southern Illinois University Press, Carbondale, IL. Hanley, R.P., 2015, “Adam Smith on the ‘Natural Principles of Religion’’’, Journal of Scottish Philosophy, vol. 13, no. 1, pp. 37–53. Harrison, P., 2011, “Adam Smith and the History of the Invisible Hand”, Journal of the History of Ideas, vol. 72, no. 1, pp. 29–49. Hayek, F.A., 1967, “The Results of Human Action not Human Design”, in F.A. Hayek, Studies in Philosophy, Politics and Economics, Routledge & Kegan Paul, London, pp. 96–105.

16  Craig Smith ———, 1979, “Dr Bernard Mandeville”, in F.A. Hayek, New Studies in Philosophy, Politics, Economics and the History of Ideas, Routledge & Kegan Paul, London, pp. 249–66. ———, 1993, Law, Legislation and Liberty [1973–1979], Routledge, London, 3 vols. Heath, E., 2014, “Metaphor Made Manifest: Taking Seriously Smith’s ‘Invisible Hand’”, in D.F. Hardwick & L. Marsh (eds.), Propriety and Prosperity: New Studies on the Philosophy of Adam Smith, Palgrave Macmillan, London, pp. 169–97. Heydt, C., 2017, “The Problem of Natural Religion in Smith’s Moral Thought”, Journal of the History of Ideas, vol. 78, no. 1, pp. 73–94. Hill, L., 2001, “The Hidden Theology of Adam Smith”, European Journal of the History of Economic Thought, vol. 8, no. 1, pp. 1–29. ———, 2020, Adam Smith’s Pragmatic Liberalism: The Science of Welfare, Palgrave MacMillan, Cham, Switzerland. Jacobs, S., 1998, “Michael Polanyi and Spontaneous Order, 1941–1951”, Tradition and Discovery: The Polanyi Society Periodical, vol. 24, no. 2, pp. 14–28. ———, 2000, “Spontaneous Order: Michael Polanyi and Friedrich Hayek”, Critical Review of International Social and Political Philosophy, vol. 3, no. 4, pp. 49–67. Kennedy, G., 2009, “Adam Smith’s Invisible Hand: From Metaphor to Myth”, Econ Journal Watch, vol. 6, no. 2, pp. 239–63. ———, 2013, “Adam Smith on Religion”, in C.J. Berry, M.P. Paganelli & C. Smith (eds.), The Oxford Handbook of Adam Smith, Oxford University Press, Oxford, pp. 464–84. ———, 2014, “The ‘Invisible Hand’ Phenomenon in Economics”, in D.F. Hardwick & L. Marsh (eds.), Propriety and Prosperity: New Studies on the Philosophy of Adam Smith, Palgrave Macmillan, London, pp. 198–222. Kleer, R.A., 1995, “Final Causes in Adam Smith’s Theory of Moral Sentiments”, Journal of the History of Philosophy, vol. 33, no. 2, pp. 275–300. Luban, D., 2020, “What Is Spontaneous Order?”, American Political Science Review, vol. 114, no. 1, pp. 68–80. Macfie, A.L., 1967, The Individual in Society: Papers on Adam Smith, Allen & Unwin, London. ———, 1971, “The Invisible Hand of Jupiter”, Journal of the History of Ideas, vol. 32, no. 4, pp. 595–9. Martin, D.A., 1990, “Economics as Ideology: On Making ‘The Invisible Hand’ Invisible”, Review of Social Economics, vol. 48, no. 3, pp. 272–87. Nozick, R., 1974, Anarchy, State, and Utopia, Basil Blackwell, Oxford. Oslington, P., 2011, “Divine Action, Providence and Adam Smith’s Invisible Hand”, in P. Oslington (ed.), Adam Smith as Theologian, Routledge, London, pp. 61–76. Otteson, J.R., 2002, Adam Smith’s Marketplace of Life, Cambridge University Press, Cambridge. Pack, S., 1995, “Theological (and Hence Economic) Implications of Adam Smith’s ‘Principles which Lead and Direct Philosophical Enquiries’’’, History of Political Economy, vol. 27, no. 2, pp. 289–307. Petsoulas, C., 2001, Hayek’s Liberalism and its Origins: His Idea of Spontaneous Order and the Scottish Enlightenment, Routledge, London.

Adam Smith and spontaneous order  17 Polanyi, M., 1951, The Logic of Liberty: Reflections and Rejoinders, Routledge, London. Rothschild, E., 1994, “Adam Smith and the Invisible Hand”, American Economic Review, vol. 84, no. 2, pp. 319–22. ———, 2001, Economic Sentiments: Adam Smith, Condorcet, and the Enlightenment, Harvard University Press, Cambridge, MA. Samuels, W.J., 2011, Erasing the Invisible Hand: Essays on an Elusive and Misused Concept in Economics, Cambridge University Press, Cambridge. Schliesser, E., 2017, Adam Smith Systematic Philosopher and Public Thinker, Oxford University Press, Oxford. Schwarze, M.A. & J.T. Scott, 2015, “Spontaneous Disorder in Adam Smith’s Theory of Moral Sentiments: Resentment, Injustice, and the Appeal to Providence”, The Journal of Politics, vol. 77, no. 2, pp. 463–76. Smith, C., 2006, Adam Smith’s Political Philosophy: The Invisible Hand and Spontaneous Order, Routledge, London. Whyte, J., 2019, “The Invisible Hand of Friedrich Hayek: Submission and Spontaneous Order”, Political Theory, vol. 47, no. 2, pp. 156–84.

2 Systems, love of system and modernity Jean-Daniel Boyer

1 Introduction In the first chapter of Part IV of the Theory of Moral Sentiments (TMS), Adam Smith mentions a specifically human motivation that he deems partially irreducible to self-interest and to the selfish passions: the love of system (TMS, IV.1.11: 185). This singular motivation can be perceived in his work only very occasionally, evoked through certain images such as that of the man who took the trouble to rearrange the chairs he had found displaced and disordered, seeking in this activity neither utility nor convenience but only the satisfaction born of the “arrangement of things” (TMS, IV.1.4: 180). The disorder that Smith evokes – and more precisely the disarray apparently caused by a careless servant – was of such a nature as to arouse in this man both a deep dismay and a thoughtless feeling of anger such that only a prompt tidying up would allow him to calm down. But Smith adds that To attain this conveniency [this man] voluntarily puts himself to more trouble than all he could have suffered from the want of it; since nothing was more easy, than to have set himself down upon one of them, which is probably what he does when his labour is over. What he wanted therefore, it seems, was not so much this conveniency, as that arrangement of things which promotes it. Yet it is this conveniency which ultimately recommends that arrangement, and bestows upon it the whole of its propriety and beauty. (TMS, IV.1.4: 180) Through the evocation of the love of system, Smith sketches the features of a specific human determination, difficult to explain by the system of utility referred to in the title of the chapter – “Of the beauty which the appearance of Utility bestows upon all the productions of art, and of the extensive influence of this species of Beauty” (TMS, IV.1: 179) – in which this assertion appears.

DOI: 10.4324/9781003301448-3

Systems, love of system and modernity  19 To account for this determination, we propose to make a detour through Smith’s theory of knowledge to show that the love of system derives from specific features of human mind. This love seems to become more widespread with the onset of modernity, which it indeed contributes to defining. Then we show that the love of system can be considered as a love of order justified in a second instance by its effects and by utility. So, while utility does not appear as a primary motive, it is still a necessary motive to legitimize the system produced. On these grounds, we propose to establish a distinction between the love of system and what Smith calls the spirit of system. We conclude on the contemporary scope of Smith’s reflections.

2 The love of system and the Smithian theory of knowledge Although nowhere in his texts does Smith state this explicitly, the human determination to put things in order nevertheless appears in his work as a specific feature of the human mind. It does not, properly understood, derive from a calculation of utility or an aesthetic sentiment. Human thought bears witness to this tendency. 2.1 Surprise and wonder: the destabilization of the order of knowledge For Smith, knowledge appears as the unintentional result of a process of ordering of elements. It begins with a destabilization of the mental order following the advent of new phenomena, most often fortuitous. This disruption of a pre-existing structure that conferred intelligibility on the unfolding of phenomena (a structure that we could describe in a very broad sense as a system, understood as a mode of explanation of phenomena endowed with a certain internal coherence) is, indeed, the initial moment of human reasoning conceived as a dynamic process of reordering. Following Smith’s account, the mind can be disturbed by the unforeseen advent of two types of events that destabilize the order of thought: the surprising event and the wondrous event. Surprise is generated by the appearance of a known but unexpected element. This event breaks the habitual and routine course that the imagination takes between things and elements (HA, I.2–6: 34–6). While the imagination succeeds in locating the surprising element within preexisting classifications (since it recognizes the nature and the identity of the element), it cannot account for the logical sequence of its occurrence. It cannot link it to other events that are prior or posterior to it. Thus, the surprising phenomenon casts the mind back upon its limits,

20  Jean-Daniel Boyer either because it was unable to anticipate the occurrence of past events, or because it is unable to imagine the succession of future events. It breaks the order in which until then the imagination had been peacefully unfolding. The surprising event thus creates a disturbance to the extent that the imagination cannot manage to link it in a coherent and simple way to the structures of the order hitherto established or to inscribe it in the usual and known succession of phenomena. Unlike surprise, wonder ensues upon the advent of a new and hitherto unknown phenomenon (HA, II.3: 38–9). The wondrous phenomenon disturbs the path of the imagination on two levels: like the surprising phenomenon, the imagination fails to link it to the succession of other events, but, more than this, the imagination also fails to place it within previously established classifications (for more details, we refer to Biziou, 2003: 22–5). The advent of a “surprising” or “wondrous” phenomenon disturbs the mind by creating disorder. It shatters the usual and ordered patterns that had until now channelled the imagination, thought of as the properly human capacity to establish abstract relations between things or between phenomena. It causes tension that needs to be resolved. To deal with such a phenomenon, the mind is obliged to reintegrate it into its habitual schemes of relations, or else to forget it. In the first case, the imagination sends out tentacles of abstraction seeking relentlessly to link the surprising or wondrous event to known phenomena or relations. By this means, it tries to establish abstract links to fill the gap that separates them, proceeding most often by associations of ideas. But as long as these relations remain unsatisfactory or overly complex, the multiplication of such attempts tires the mind. This incessant and panicked deployment of the imagination, which no longer knows where or towards what to convey itself, causes the disarray of the mind, and finally generates mental exhaustion for the individual concerned unless, by happy chance, either a relation is finally established or oblivion comes to relieve it. In this process of linking disjoint phenomena, the imagination always seems to choose the simplest plausible link. 2.2  An irrepressible desire for order By managing to find an abstract link between phenomena, the imagination contributes to satisfying the human mind’s desire for order. It arranges the elements in a way that allows it to describe their succession. But, in this search for order, it also seeks to arrange elements in classifications, on the basis of characters judged to be sufficiently common between them. Thus, Smith writes, “Whatever, in short, occurs to us we are fond of referring to some species or class of things, with all of which it has a nearly exact resemblance” (HA, II.3: 38). This tendency to associate each element to classes is confirmed by the progress of the human

Systems, love of system and modernity  21 mind, which constantly contributes to the refinement and increasing precision of taxonomies that classify elements according to their similarity. Thus, the imagination’s search for order and systemic arrangement plays out in two dimensions: in classification, which is a static ordering, linking phenomena in classes with respect to their nature; and in relating elements, which is a dynamic ordering. This second modality, which is the search for the genealogical links between things, is also the search for the causes of a phenomenon. From these characteristics of the mind, we may deduce the basic character of Smith’s own studies, which may be assimilated, in general, either to research on the nature (deriving from the classifying dimension) or on the causes (deriving from the ordering dimension) of a phenomenon, as the title of his work on political economy shows. In a second moment, the mind tries to simplify or rationalize the connections made in order to facilitate the path of the imagination. It seeks the simplest link possible and functions according to a principle of economy. Finally, there is a third moment that consists of a search for completeness, aiming at finding links that associate the most diverse elements possible. Through these characteristics, we can find the principles that validate the links established between the phenomena in a way that satisfies the human mind. The human mind must indeed give its approval to the links made by the imagination, and it selects among them according to a double requirement of similarity (the principle of classification, or order of classification) and of relation (principle of order, or of setting in relation). Smith adds a requirement of simplicity, which is a third criterion for validating the linkages proposed by the imagination, and finally, they would be supplemented by an imperative of completeness. The human mind thus selects or approves only the imaginative links that it deems sufficiently ordered and simple. Then, it has, at its disposal, taxonomies and chains of imaginary causal occurrences that allow it to fill the gap between existing things and disjointed events, between the surprising or wondrous event and the existing schemes of thought. These classifications and chains of occurrence enable the human mind to identify phenomena, but also to explain them and predict their occurrence. Thus, philosophy is logically the science of the connecting principles of nature. […] by representing the invisible chains which bind together all these disjointed objects, [it] endeavours to introduce order into this chaos of jarring and discordant appearances, to allay this tumult of the imagination […]. (HA, II.12: 45–6) But philosophy and science are not the only human activities that seek to create order. Music and arts, politics and economics but also religions

22  Jean-Daniel Boyer propose systemic compositions that link phenomena and elements. Moreover, since the simplest systems are usually privileged, the properly scientific explanations are not always selected: they are selected only if the links they propose are simpler and can be applied to more phenomena (see, for example, Smith, 2018). It is through the characteristics of the human mind that we can find the origin of the love of system, which appears as a human determination to seek order and to arrange things systematically. This love is essentially expressed in pain and effort. While it leads man to develop abstract systems, it also leads him to produce concrete systems. Thus, the love of system contributes to an abstract but also to a concrete process of setting the world in order, which is also thought of as contributing to its embellishment. 2.3  Order, beauty and admiration By the coherence of the associations it proposes and by the arrangement of the elements it establishes, the act of setting phenomena in order also generates beauty. It articulates the parts so as to produce a more harmoniously composed whole. Then the established arrangement arouses in us a higher satisfaction that brings the aesthetic dimension into association with the cognitive, suggesting beauty and producing admiration. More precisely, it produces a kind of beauty that lies essentially in the aesthetic of composition and less so in the beauty of the elements: it considers the beauty of the whole and not of the parts. Yet this aesthetic feeling is secondary; it follows upon the construction of the system but does not really motivate it. The good system is therefore also a harmonious system. It proposes a coherent order characterized by the existence of appropriate measures in the arrangement and in the association of the elements. And just like in music – for which the term system is used in the 18th century, as evidenced by Jean-Jacques Rousseau’s article in the Encyclopédie of 1765 – harmony is generated by the right relationships (Rousseau, 1765). In the dynamic movement, aiming at integrating as many elements into the system as possible, the aim is always to establish suitable, appropriate and well-adjusted connections, or to succeed in preserving or restoring them. Given its aesthetic character, the contemplation of order gives rise to a satisfaction that explains why the order produced is very often loved for its own sake. According to Smith, every system, abstract as well as concrete, generates the sentiment of admiration. This is why systems are often loved for their own sake, and are frequently preserved even where they do not allow us to account for certain aporias. As long as the aporias are not too numerous, the system is maintained.

Systems, love of system and modernity  23 2.4  Systematization and modernity By establishing links between phenomena or things, the human mind creates an ordering that is deemed to be sufficiently coherent and acceptable, allowing any surprising or wondrous event to be related to other known elements, either by integrating it into previous coherent thought patterns – and thus bringing it back to the system that pre-existed the occurrence of the destabilizing event – or by shaping new links, i.e. generating a new systemic order. From these characteristics of the human mind, Smith also pronounces upon the future of all systems, from philosophy to languages or arts, from legislative systems to productive systems. With time, their connections would become simpler, more complete, but also more systematized. Thus while the process of systematization results from the character of the human mind, it also shapes the human mind’s future, and, by extension, the future of society, from the moment when “order and security [are established], and subsistence ceases to be precarious” (HA, III.3: 50). According to Smith, systematization would blossom into a framework marked by stable legislation but also by material wealth, properties that particularly characterize the commercial society that asserted itself after the overthrow of feudalism. Thus the spread of the love of system is a characteristic of modernity. It determines the constitution of the modern science, that of a modern episteme, but also the modern mentality. By symmetry, modernity would not be defined as a circumscribed temporal period but by the characteristics of the human mind and, by extension, by socio-cultural features. It would be the moment of the systematization made possible by a precise socio-historical framework. Ancient Greece, by this token, would already have been modern to some extent.

3  The love of system and the system of utility The love of system is thus a need for order. It echoes the Humean evocation of the “love of order and uniformity, which arranges the books in a library, and the chairs in a parlour” (Hume, 1896, III.ii.3: 504, note). It induces man, and more precisely the man of modernity, to arrange things by giving them an order. As we saw, the preliminary setting-in-order is done first of all for itself. It is done to arrange things, out of a desire for order, without necessarily thinking about the nature of the order that will be produced, nor about its possible effects. Thus, in its motivations, the love of system is irreducible to the search for utility, even if it might generate it. 3.1  The love of system: an aporia in the system of utility As Daniel Diatkine reminds us, it is through the evocation of the love of systems that Smith seeks to criticize the “principle, asserted by Hume,

24  Jean-Daniel Boyer according to which the search for utility is the guide to judgment, and hence to action” (Diatkine, 2000: 490; Diatkine, 2010: 387–8). For while Smith recognizes the diffusion of the motives of utility and self-interest within modern and commercial societies, especially following the development of a mercantile culture (see for example WN, IV.intro.2: 428), he also considers that these are not the only motives that determine human actions or modernity (see, for example, TMS, I.i.1.1: 9). Nevertheless, seeking to account for the role of the love of systems in motivating action, Diatkine first tries to consider it from the perspective of utility. Recalling the man rearranging the chairs he had found in a disordered manner, Diatkine points out that it must seem obvious to the reader That Smith merely makes two arguments serve one utility function (the chairs certainly provide somewhere to be seated, but they also serve to decorate a room). If someone takes the trouble to tidy them away, it is probable that the effort involved in household chores is more than compensated by the utility derived from the pleasure deriving from the enjoyment of order. Hence, and in a less trivial manner, this means that his calculation of a maximum is erroneous, although this is of little importance since the assumption of rationality reassures us that they will not be left out again. (Diatkine, 2010: 388) Yet if we pursue Diatkine’s analysis, it would appear that the system of utility to which he refers (and which is that of any “good” economist, but also that of contemporary Western culture) is precisely what is destabilized by the evocation of the action of rearranging the chairs. This evocation should thus raise doubts in the mind of someone who believes (and who was socialized to believe, due to having been raised within the ever-expanding empire of utilitarian reason) that the maximization of utility can explain any individual action. Indeed, for a supporter of utilitarian reason, the example of the disordered chairs and their tidying up is, in the Smithian sense of the term, surprising, even wondrous because it cannot be spontaneously explained by recourse to the axiomatics of interest and of utility. It is then necessary to give an account of this aporia in order to reassure oneself of the centrality of utility in this scenario, and, consequently, to reassure the supporters of the utilitarian system. Diatkine does this in two ways: first, by asserting that there is indeed a satisfaction generated that allows us to understand the trouble taken by the man who puts the chairs in order. It is, moreover, implicitly a superior utility that explains the rearrangement: an aesthetic utility, which is not perceived by the ordinary individual – such as the one who seems to have been Smith’s careless servant – who only granted an objective utility to a chair

Systems, love of system and modernity  25 and thought that it was useful only for sitting. The servant (unlike the Scottish philosopher) would not have had this higher aesthetic sense. He would have arranged the chairs randomly or according to an aesthetic arrangement that did not correspond to the criterion of beauty (thought of as a universal and superior criterion that is perceived by his master, which is apparently Smith). Thus, the rearrangement could, in the end, be explained in a utilitarian way: the aesthetic satisfaction provided by the (re)ordering and by the extra utility generated would outweigh the disutility and the pains caused by the reordering. In this case, the system of utility would be secure. The individual would have arranged the chairs in such a way as to generate an aesthetic utility greater than the disutility that the tidying up would have cost him. So, he would have maximized his personal utility. The lover of the system of utility may thus be reassured. He would have restored a surprising phenomenon, an aporia, to its place in a pre-existing system, that of utility. But it would seem that this does not fully satisfy Diatkine, just as it does not fully satisfy us. Echoing the point of view of the economist who is familiar with utility calculations, Diatkine then proposes a test of this solution, postulating that, if the individual realized that this level of satisfaction had been too low, and that it had not compensated for his pains, he would not put the chairs in order again in the future. If this were the case, the utility system would now be doubly saved. But we may doubt that this is so. 3.2  Love of system as love of order In its motivations, the love of system is indeed largely irreducible to the search for utility. As we saw previously, it appears as a spontaneous tendency to put things in order. It is therefore irreducible to a maximization calculus. It is a love of order that finds in itself its own motivations. Moreover, the satisfaction generated by the restoration of order only very rarely compensates for the dissatisfaction produced by the confrontation with the previous disorder. It is too short-lived and its intensity is too weak. In addition, the lover of system rarely engages in a utilitymaximization calculation to determine whether to put things back in order. If he did, the chances are he would postpone putting things in order or not bother at all. His best strategy in terms of utility maximization would be to forget the disorder altogether. Nor is there generally any great satisfaction in the very act of putting things in order, since it involves only pain, effort and tension, leading to a final satisfaction that is often much less than the pain expended, as evidenced by the arranger of chairs or anyone who undertakes any household action. The lover of system, therefore, knows that he is going to put himself through a lot of trouble for a satisfaction that is extremely weak

26  Jean-Daniel Boyer compared with the efforts made. And yet, he does it again. Sometimes, the lover of system is so driven by this desire to order things that he voluntarily creates the disorder from which order may be restored. So it is with the lover of puzzles, such as the Rubik’s cube or other (re-)construction activities. He is taken by an obsessive and frenetic love of order that does not seek the result in itself, since he destroys the order that existed before in order to rebuild it. The theory of utility and interest can therefore account only imperfectly for these motives for action. The love of system therefore has its own motive. It is not motivated by a maximization calculation. It is irrational, not in the sense that it is contrary to human reasoning but because it does not fall within the scope of utilitarian rationality. 3.3  Love of system and confusion of ends and means No doubt this is the reason why Diatkine, seemingly seized by a doubt as to the heuristic scope of the system of utility, in a third moment leaves aside a utilitarian explanation and turns us instead towards another modality of explanation. His imagination (and ours) is then diverted, voluntarily or involuntarily – to the point of forgetting the initial surprising event – towards another object of reflection, following the evocation, by Smith himself, of another example that we find in the TMS, just after that of the chair arranger. This example is that of the chronometer enthusiast who despises any watch “that falls behind above two minutes in a day,” so that he “sells it perhaps for a couple of guineas, and purchases another at fifty, which will not lose above a minute in a fortnight.” Yet, Smith tells us, The sole use of watches however, is to tell us what o’clock it is, and to hinder us from breaking any engagement […]. But the person so nice with regard to this machine, will not always be found either more scrupulously punctual than other men, or more anxiously concerned upon any other account, to know precisely what time of day it is. What interests him is not so much the attainment of this piece of knowledge, as the perfection of the machine which serves to attain it. (TMS, IV.1.5: 180) According to Diatkine, “[t]aken at face value, th[is] passage now shows us what we are dealing with: an opposition between means and ends and, more precisely, one that opposes the machine to the useful effects one might expect of it” (Diatkine, 2010: 389). As Diatkine suggests, “it is the love of system that Smith contrasts with the pursuit of utility” (391), and that is independent of the ends (391–2). Thus, the lover of system would be preoccupied more by the system itself than by its effects. He would love the order for itself and not for its ends. This order

Systems, love of system and modernity  27 pleases him. Nevertheless, and as we saw, it is not this pleasure that determines the ordering of things in the first place. Even if it may exist, it is an unthinking feeling born of the character of the human mind that determines man to put things in order. Moreover, on Smith’s account, a system, like a machine, should be seen as always combining two dimensions: ends and means. The distinction between ends and means may seem not to be so crucial, but, as we will see, it allows us to specify the contours of what Smith will call the spirit of system. 3.4  The love of system as the love of perfect arrangements Returning to the theme of systems, we must emphasize that for Smith, a watch is indeed a system as well. The idea that a system is similar to a machine is recalled by Smith several times. For example, he underlines that Systems in many respects resemble machines. A machine is a little system, created to perform, as well as to connect together, in reality, those different movements and effects which the artist has occasion for. A system is an imaginary machine invented to connect together in the fancy those different movements and effects which are already in reality performed. (HA, IV.19: 66) There is thus a similarity, and even an identity, between a system and a machine. Every system is a machine, every machine is a system. But it is not the means rather than the ends, or the ends rather than the means, that interests the lover of systems: what interests him is the system as means adjusted to ends, or, to be more precise, as an arrangement of elements generating an end that ultimately testifies to the perfection of the system. For the watch lover, it is not the end (the precise time), nor the means (the set of mechanisms) taken independently that interests its owner. It is the system, as an arrangement of means and ends, that fascinates him. It is not only the capacity of the watch to indicate the time precisely that the lover of systems seeks: what interests him is the perfection of the assemblage and of the workings of the system. The precision with which the watch tells the time is only an indication or a tangible proof of its perfection; and, on the contrary, the fact that it indicates the time in an imprecise way testifies to the imperfection of its composition and its assembly. This is why the lover of system does not like it. By its inaccuracy, the watch demonstrates to him at every moment that the mechanism does not work perfectly. The lover of system is then constantly brought back to the idea of the existence of a disorder in the system. This is what is unbearable for him. In this case, he is likely to abandon the watch. He would rather get rid of it, sell it or destroy it, even if he then has no way of telling the time.

28  Jean-Daniel Boyer In a similar way, a badly assembled watch, with badly ordered cogs, but which, on the other hand, gave him the most precise time, would not interest the lover of system either. It would arouse in him only surprise: how can imperfect mechanisms linked together produce a perfect result? As we can see, what interests the lover of system is the overall perfection of the mechanism. Smith reminds us indeed that “[t]he wheels of the watch are all admirably adjusted to the end for which it was made, the pointing of the hour. All their various motions conspire in the nicest manner to produce this effect” (TMS, II.ii.3.5: 87). It is thus the harmonious ordering of the elements, which can be perceived by means of the happy effects that it produces, that the lover of system seeks. It is neither the means in themselves nor the ends in themselves that interest him: it is the whole. It is the ordered general mechanics, it is the cogs and their perfect assemblies, of which, in the case of the watch, the precision of the time given is the final proof. Thus, the final end of the system and its overall utility are only secondary justifications relative to the perfection of the elements and their perfect ordering. They give a sense (a meaning and thus also a utility) to the system and so raise it above the vanity and the uselessness of its constitution and existence. They give the proof of the quality of the watch and of the superiority of the system. If the watch did not give the exact time, the individual would not be able to justify his fascination with it, and we would not understand why he should be so absorbed by the mechanical assemblage. Smith provides a logical completion to his reference to the love of systems by referring to the love of perfect systems. The lover of system has the greatest love for the most perfect possible systems. He is ready to sacrifice time, effort and money to strive for the perfection of what he considers to be true order. This is the case with the watch lover. He likes two things: he likes a mechanical system made up of various cogs with particular properties that generate an end that is irreducible to the properties and use values of each of them. And he likes an ordered arrangement of heterogeneous elements generating a specific end. But the utilitarian purpose – the final end of the system – is only the means that attests to the superiority of the system and its qualities. It is, at root, a criterion of proof.

4 Between love of system and spirit of system: some problematics of modernity There would thus exist a love of the good order, a love of the beautiful economy conceived in the sense of an arrangement of elements – that is, in the sense given by Rousseau in his article published in 1755 in the Encyclopédie entitled “Economie or Œconomie” (Rousseau, 1755). This would become a feature of modernity.

Systems, love of system and modernity  29 4.1  Love of systems as love of order: conception, repair and contemplation This love of system can be declined in three great categories. It can reside in the love of the conception and construction of theoretical or concrete systems by seeking the harmonious arrangement of elements. The lover of system is then a designer, a creator of systems. Thus, the philosopher, and every scientist, is a lover of system. But the engineer and the craftsman correspond also to this figure. Moreover, following the extension of the division of labour, modernity is characterized by the specialization of some people in the specific task of system building. The lover of system is also a repairer of systems that she or he considers defective. She or he then proposes to restore the good order and good mechanical functioning. In her or his undertaking, he seeks to perfect the system. The objective is to strive for perfection of the arrangements and to adjust the different elements of the system as well as possible. This also characterizes Smith’s own ambition to examine existing abstract systems and theories, whether in philosophy or economics, so as to identify their imperfections and improve them. In a similar way, the policymaker who seeks to transform the social and economic world corresponds to this figure. The lover of system is here a reformer. The last type of lover of system is the system contemplator. He is fascinated and pleased by the systemic order. The harmonious order that he contemplates suits him no doubt because his imagination, thanks to his knowledge of the systemic mechanisms as well as of its ends, can move peacefully through each of the relationships. He is then pleased to contemplate the perfect order of the system. But, according to Smith, the first two modalities are much more common than the last. Indeed, [m]an was made for action, and to promote by the exertion of his faculties such changes in the external circumstances both of himself and others, as may seem most favourable to the happiness of all. (TMS, II.iii.3.3: 106) 4.2  Love of system and spirit of system But while the love of system seems to refer to quality, Smith associates another human tendency, the spirit of system, with a more blameworthy inclination. It characterizes, in particular, the man of system who is apt to be very wise in his own conceit; and is often so enamoured with the supposed beauty of his own ideal plan of government, that he cannot suffer the smallest deviation from any part of it. He goes on to establish it completely and in all its parts, without any regard

30  Jean-Daniel Boyer either to the great interests, or to the strong prejudices which may oppose it. (TMS, VI.ii.2.17: 233–4) The love of system could thus degenerate into a spirit of system. According to Smith, [f]rom a certain spirit of system, however, from a certain love of art and contrivance, we sometimes seem to value the means more than the end, and to be eager to promote the happiness of our fellowcreatures, rather from a view to perfect and improve a certain beautiful and orderly system, than from any immediate sense or feeling of what they either suffer or enjoy. (TMS, IV.1.11: 185) The spirit of system thus consists in forgetting the ends for which the system was designed, in forgetting to consider and to evaluate the effects of the system. The spirit of system is therefore a degeneration of the love of system. It is an obsessive love of the system for its own ordering. The man of modernity, and in particular, the one specializing in the production of system, would be particularly exposed to this risk. This would be the case of the philosopher but also of the politician. To avoid this corruption, the system must be judged by its effects, by its purposes. It must be judged by criteria not only of internal efficiency but also by external efficiency. Means and ends must be considered together. Finally, different modalities of the love of system would appear according to the diverse ways in which one could come to consider the ends and the means. The differences too would also testify to the problematics of the modern man. The man with the spirit of system would consider the means more than the ends; the lover of the system of utility or the utilitarian would consider the ends more than the means. From Smith’s perspective, the good attitude seems to be in between: taking into consideration both the means and the ends. 4.3 Spirit and love of system in philosophy, politics and economics The distinction between love and spirit of system emerges in philosophy, as well as in politics and economics. In philosophy, the spirit of system corresponds to the unconditional love of a theory. It is similar to a dogma. To avoid it, the abstract system created must be confronted with concrete facts. The philosopher must abandon his system if it does not manage to give an account of the concrete facts that it is supposed to explain, if it cannot associate elements in a coherent way or predict the occurrence of phenomenon.

Systems, love of system and modernity  31 Here Smith seems to echo Condillac’s Traité des sistêmes published in 1749. For Condillac, “the true systems, those which alone deserve to bear the name,” are founded on experience and on principles “which are only well established on facts” (Condillac, 1749: 8). Smith’s position may also be understood by reference to Turgot’s Recherches sur les causes des progrès et de la décadence des sciences et des arts (1748) or his Éloge de Gournay (1759): Turgot considers that the building of systems is one of the vectors of the progress of the human mind and of societies (Turgot, 1913: 131–4), while, on the contrary, “it is softness, stubbornness, the spirit of routine and everything that leads to inaction” that opposes the progress of truth (133). But while Turgot lauds systematicity, he also criticizes thought that is overly systemic, and denounces the spirit and the man of system. He conveys the reservations of all those philosophers who have denounced the spirit of system as characterized by the desire to account for all phenomena in this world through a single abstract system of explanations based on unproven hypotheses. The spirit of system would also be characterized by the neglect of observation and would correspond to the non-scientific attitude that Condillac also denounced. In his blindness, and fascination with his own system of thought, the man of system seeks to reduce the complexity of reality to singular relations that he had himself imagined. He would reverse the order of scientific reasoning by starting from theory – in this case, unfounded – so as to proceed to the facts. He simplifies and twists the set of events in this world to make them compatible with his own pre-existing system of perception (Turgot, 1844: 286–7). But above all, he does not tolerate the slightest questioning. In this enterprise, he would also be essentially driven by self-love, by the fascination of his own imaginary productions. He is then ready to make his system progressively more complex in order to explain any event in this world on its basis, whereas it should become simpler. Fascinated by the internal arrangement, he forgets the external criterion of judgement that is essential. The man moved by the spirit of system would thus rather wish for a transformation of the world to make it conform to his system than consider the modification of his abstract system to make it coincide with the facts. His abstract system would then become normative. Thus, the spirit of system also refers to the normative tendency of certain theories that has its origin in the self-love of the philosophers. This tendency also finds its expression in politics. As we have seen, it is one of the characteristics of the man of system to want to shape the world according to his own views without considering the individual wills or the general effects of his project. Driven by the spirit of system, he does not truly consider the effects of his plan of government and by extension he forgets the general good. Here, the spirit of system would find its echo in the authoritarian or totalitarian projects that particularly marked the 20th century.

32  Jean-Daniel Boyer On the contrary, the man of public spirit takes into account the effects of the system from a general perspective (TMS, IV.1.11: 185–6). He is driven not by social passions nor by humanity but by the consideration of the whole, of its functioning and its future. He is concerned with the increase of the wealth and power of his nation; and sometimes with the happiness of its members. More broadly, he is attentive to the results produced by the system he sets up, and the national and general interest acts as the guide for his political action. But in developing his account, Smith seems to forget that the purpose of the system depends on objectives that have been previously defined and are simply postulated as legitimate. Yet these are not necessarily virtuous. For example, the pursuit of the general interest considered as the national interest can lead to the destruction of other nations. Thus, taking into account the purpose of the system would also imply a moral evaluation of its objectives, so as to be sure of their ethical value and their legitimacy. Finally, and more generally, the spirit of system can be seen at work, particularly in economic theory. Considered as abstract systems aimed at governing men, here it would combine the defects of systems both in philosophy and in politics. Economic theory can be grounded on false hypothesis. It can promote particular interests and not the general interest. This would be particularly true of the mercantile system but also, to a lesser extent, of the agricultural systems (WN, IV). In terms of political economy, the spirit of system can lead one to forget the consideration of the whole and so promote a system of legislation favourable to particular interests or to the interests of certain social classes. That is the reason why economic theory must be grounded on facts and consider the general interest. Economics must be driven by the public spirit, and must question the final end of the concrete system that it contributes to promote.

5  Concluding remarks By evoking the image of the man who took the trouble to rearrange the chairs he had found disordered, and by intimating he himself might be this man, Smith leaves us wondering whether he too may have been an obsessive lover of system. In any case, the development of his thought contains a profound reflection on the nature of systems, and also itself has a systemic aim. For these reasons, the supposed incoherence of Adam Smith’s system detectable in the Adam Smith Problem does not hold by construction if we refer to Smith’s ambition. But while the love of system certainly leads to the elaboration and readjustment of systems, it does not settle the matter of the quality of the systems so produced. A lover of system can indeed become a dogmatic man of system moved by the spirit of system. He can seek to justify and defend his system despite its imperfections. He may even be ready

Systems, love of system and modernity  33 to distort the results produced to show its superiority. So systematicity cannot guarantee the quality of the systems produced. According to the theory of knowledge Smith proposes in his History of Astronomy, and following his criticism of the spirit of system, different criteria of validity appear concerning the systems produced, depending on whether they are abstract or concrete. Concerning the abstract and theoretical system, a good system is one that (1) is grounded on facts and not on hypothesis, (2) is made of simple links connecting various elements, (3) is able to integrate and link many elements and to give an account of them, (4) arouses admiration because it is harmonious and suggests harmony, (5) is able to logically explain the occurrence of an event, and also (6) is able to predict the advent of a phenomenon. These present themselves as criteria of modern science that differentiate it from mere belief. A good concrete system is at the same time simple, complete and harmonious. It arouses admiration and is also able to produce a valued end in the most efficient and accurate way. The effects are not appreciated for themselves as such, but rather for providing additional evidence of the perfection of the system. But Smith rarely offers criteria for evaluating what would be a ‘good’ purpose for a concrete system or for what can be considered as the ‘good’ final end of the whole. Nevertheless, a close reading of his texts suggests certain quantifiable effects that would be particularly suitable to allow us to appreciate the superiority of a system. For example, Smith writes that [t]he idea of that divine Being, whose benevolence and wisdom have, from all eternity, contrived and conducted the immense machine of the universe, so as at all times to produce the greatest possible quantity of happiness, is certainly of all the objects of human contemplation by far the most sublime. (TMS, VI.ii.3.5: 236) And among these quantifiable effects, economic growth plays a key role in Smith’s work as a means to judge legislative systems, policies and economic reforms. It appears as the criterion of veridiction of the good government, and sometimes an indicator of happiness. This shows the essential place of The Wealth of Nations in Smith’s work, and hence this text could also be considered a political essay as well as an economic treatise. Questions of economics would, in fact, be the criteria against which to assess the political and legislative consequences arising from any proposed system. In Smith’s view, growth would be the modern criterion of validation for any mooted political, legislative or economic system, and would replace the imperative of power promoted by the mercantile system.

34  Jean-Daniel Boyer From a more general perspective, this consideration could also explain one of the impasses in which we find ourselves in seeking to envisage a new system capable of facing contemporary environmental challenges. The final end of growth of the production of material wealth has indeed revealed its limits as a means to evaluate the effects of our socioeconomic systems. It would thus be appropriate to take into account at least the destruction that economic growth engenders. More generally, it seems necessary to question the very purpose of the economic system and to find new indicators to evaluate it, if we are to have any hope of shifting its orientation.

References Biziou, M., 2003, Adam Smith et l’origine du libéralisme, Presses Universitaires de France, Paris. Condillac, É. Bonnot de, 1749, Traité des sistêmes, où l’on en démêle les inconvéniens et les avantages, par l’auteur de l’Essai sur l’origine des connaissances humaines, Neaulme, La Haye. Diatkine, D., 2000, “L’utilité et l’amour des Systèmes Dans la Théorie des Sentiments Moraux”, Revue Philosophique, vol. 190, no. 4, pp. 489–505. ———, 2010, “Vanity and the Love of System in Theory of Moral Sentiments”, The European Journal of the History of Economic Thought, vol. 17, no. 3, pp. 383–404. Hume, D., 1896, A Treatise of Human Nature [1739–1740], ed. L.A. SelbyBigge, Clarendon Press, Oxford. Rousseau, J.-J., 1755, “Economie ou Œconomie”, in D. Diderot & J. le Rond d’Alembert (dir.), Encyclopédie ou dictionnaire raisonné des sciences, des arts et des métiers, par une société de gens de lettres, Briasson, David, Le Breton, Durand, Paris, vol. V, pp. 337–49. ———, 1765, “Système, en Musique”, in D. Diderot & J. le Rond d’Alembert (dir.), Encyclopédie ou dictionnaire raisonné des sciences, des arts et des métiers, par une société de gens de lettres, Faulche, Neufchastel, vol. XV, pp. 779–81. Smith, C., 2018, “Adam Smith on Philosophy and Religion”, Ruch Filozoficzny, vol. 74, no. 3, pp. 23–39. Turgot, A.R.J., 1844, “Éloge de Gournay” [1759], in Œuvres de Turgot, ed. E. Daire & H. Dussart, Guillaumin, Paris, tome I, pp. 262–91. ———, 1913, “Recherches sur les causes des progrès et de la décadence des sciences et des arts ou Réflexions sur l’histoire des progrès de l’esprit humain” [1748], in Œuvres de Turgot et documents le concernant, ed. G. Schelle, Alcan, Paris, tome I, pp. 116–42.

3 Adam Smith as a historian of economic thought Fritz Söllner

1 Adam Smith and the origins of the history of economic thought From the beginnings of economics as a separate scientific discipline until well into the 20th century, the history of economic thought was considered as an important part of economics. Most economists not only paid close attention to the history of their discipline, but took an active part in recording and discussing this history. Already the pioneers were well aware of the work of their predecessors and the origins of their own ideas. Adam Smith was no exception. It is true that the honour of having written the first treatise about the history of economic thought belongs to the physiocrat Pierre Samuel du Pont de Nemours (1768). But Adam Smith was in second place with the publication in 1776 of his Wealth of Nations (WN), which includes, as its fourth book, a lengthy disquisition about “Systems of political Oeconomy” (WN, IV.intro: 428). It is this Book IV of WN with which we shall be mainly concerned in what follows – or, more precisely, Book IV minus the digressions about “Banks of Deposit” (WN, IV.iii.b: 479–88) and “Corn Trade and Corn Laws” (WN, IV.v.b: 524–43) and minus the chapter “Of Colonies” (WN, IV.vii: 556–641), all of which are out of place in this book. Of course, Adam Smith refers to the economic writings of other authors also elsewhere in WN (as well as in other parts of his œuvre), but these references certainly do not constitute a systematic analysis of the development of economic ideas and theories. The only part of his writings that can be interpreted as an explicit contribution to the history of economic thought is, in fact, Book IV of WN. Nonetheless, we shall have occasion to comment also on other parts of WN and on some of his other writings – when we try to answer questions about the influences of other authors, about the degree to which the ideas of Smith were – or were not – original, about the extent to which he did – or did not – acknowledge his intellectual debts and, last but not least, about the motivation behind his excursion into the history of economic thought.

DOI: 10.4324/9781003301448-4

36  Fritz Söllner

2  The methodology of Adam Smith It stands to reason that the history of ideas and methodology are closely related. After all, to write about the development of the ideas of any discipline, one has to decide which ideas shall count as being scientific – and which shall not. In other words, one has to make methodological assumptions. As Adam Smith never set forth his economic methodology explicitly, we have to infer it from the ways he makes his arguments in WN and from the remarks on methodology elsewhere in his œuvre. For our purpose, the most important ‘methodological’ remark in WN is the definition of the subject of economics or, as it then was called, political economy. The very title of WN provides a concise definition of the subject matter of political economy – to wit, “the nature and causes of the wealth of nations.” But Adam Smith gives another, narrower definition in the introduction to the historiographic Book IV: Political œconomy, considered as a branch of the science of a statesman or legislator […] proposes to enrich both the people and the sovereign. (WN, IV.intro.1: 428) It is clear that for Adam Smith, economics was an eminently political discipline – hence the name political economy. For him, positive and normative analysis were inextricably linked. The former only made sense and only could be justified insofar as its results could be made use of in the latter. He did not set great store by economic knowledge for economic knowledge’s sake. What is more, also the objective economics is supposed to further was so obvious to Smith that for him it did not even warrant a justification: the enrichment of the people and its government. His was a very pragmatic and materialistic conception of economics. Although seeming to be rather narrow from the modern point of view, this conception was generally accepted in the time of Adam Smith (and of his successors from the classical school). It explains why Smith in Book IV of WN only deals with two systems of political economy: “the system of commerce” and “that of agriculture” (WN, IV.intro: 428) – or, in modern terms: mercantilism and physiocracy. Earlier authors who discussed economic questions – from Aristotle to the Church Fathers and the scholastics – did not focus on “enrichment” and their ideas were thus out of what Smith considered the purview of economics. Smith hardly ever quotes these authors (and certainly not qua economists) and to include them in Book IV of WN would have seemed absurd to him. Though quite explicit about what political economy is supposed to be, Smith is much less explicit about how political economy is supposed to be done – that is, about the methodological demands political economy has to fulfil. There is, however, one thing that was obviously very important

Adam Smith as a historian of economic thought  37 for Smith: a systematic approach. This can be deduced even from the title of Book IV in which he refers to “systems” – and not, for example, to schools of thought. Elsewhere in WN he speaks of “[t]he beauty of a systematical arrangement of different observations connected by a few common principles” (WN, V.i.f.25: 768–9). But it is in other parts of his work that his philosophy of science becomes clearest. In the essay on the History of Astronomy, about which Schumpeter (1954: 182) was fulsome in his praise, he extols the classical mechanics of Newton because it is “a system whose parts are all more strictly connected together, than those of any other philosophical hypothesis” (HA, IV.76: 104). For this reason, he calls his ideal the “Newtonian method” that he describes as the method whereby we may lay down certain principles known or proved in the beginning, from whence we account for the severall Phenomena, connecting all together by the same Chain. (LRBL, ii.133: 145–6) He wants this method to be used in “every science, whether of Moralls or Naturall philosophy” (LRBL, ii.133: 146). No matter whether he really correctly understood classical mechanics and the methods of Newton, both The Theory of Moral Sentiments and WN “must be regarded as deliberate attempts by Smith to apply this Newtonian method first to ethics and then to economics,” because in both cases, his argument is based on one pivotal principle: sympathy for other men in the former and self-interested behaviour in the latter (Blaug, 1992: 52). His first biographer, Dugald Stewart, went so far as to refer to the prominence of systematic arrangement in the thought of Adam Smith as “his love of system” (Life, III.15: 306). Smith’s enthusiasm for the Newtonian system did not, however, go so far as to make him also subscribe to Newton’s mathematical way of reasoning. In fact, he was rather sceptical of the idea of reality having a mathematical structure and advocated a flexible – or, rather, eclectic – methodology (Roncaglia, 2005: 119–20). For him, it was perfectly legitimate, to follow the hypothetical–deductive method in Book I and II of WN and to adopt the historical–inductive method in the rest of it. The latter was, in his case, informed by the tenets of the Scottish Historical School, which included, inter alia, a belief in definite stages of history, an openness to the complexity of human behaviour and motivation, an emphasis on simplicity and elegance as criteria for what constitutes a “good” explanation, and the liberal use of analogies (historical and otherwise; see, e.g., Blaug, 1992: 52–3; Kerr, 1993: 12–4; Roncaglia, 2005: 119–20). The above-mentioned History of Astronomy is not only important because it shows how much Smith valued systems in general and the Newtonian system in particular, but also because it affords some insight

38  Fritz Söllner into his conception of the development of science. His discussion of the various astronomical theories reveals that he saw the history of science as a gradual but incessant movement towards better knowledge and some ultimate truth – by adding new insights to and pruning old errors from the body of science. He espoused – at least implicitly – the absolutist approach to the history of science. That means that old theories are to be interpreted and evaluated not in their own right but from the point of view of modern science, that is, insofar as they represent steps toward what is known today. This view implies a linear progression from past errors to the present truth. Just as he regarded the Newtonian system as appropriate for the social sciences, too, he also saw the development of the social sciences from the absolutist point of view. He never says so explicitly, but it is obvious from, in particular, his discussion of mercantilism and physiocracy in Book IV of WN. Suffice it to quote his famous verdict about physiocracy as “the nearest approximation to the truth” (WN, IV.ix.38: 678), which implies that there is some ultimate truth that is being approximated. Here, it is not possible to go into the details of the relative merits of the absolutist point of view and the contrary position, to wit, the relativist point of view. Let me just remark that, although the absolutist position is widely accepted in the natural sciences, it is highly controversial whether and to what extent it is also appropriate for the social sciences (see, e.g., Blaug 1997: 1–9). To summarize our discussion of the methodological views of Adam Smith: He defined political economy as a normative science aiming at enrichment; he valued a systematic approach very highly; and he interpreted past theories in the light of present knowledge. We already have seen that his definition of political economy explains why he only chose mercantilism and physiocracy as subjects for his essay on the history of economic thought. In the next two sections, we shall find out to what degree the other two principles informed the argument of this chapter.

3  “The commercial, or mercantile System” Smith devotes the major part of Book IV to “the commercial, or mercantile System” (WN, IV.i.1: 429), as he calls the body of writing that later became known as mercantilism. He discusses the theory of mercantilism in Chapter I and the mercantilistic policy proposals in Chapters II to VI and VIII. His discussion suffers from a problem that becomes apparent even in the headline, to wit, his reference to mercantilism as a “system.” The publications of the English pamphleteers and other mercantilistic writers from the 16th to the 18th centuries certainly do not constitute a system – in the sense of a coherent school of thought with agreed-upon theoretical assumptions, analytical principles and political objectives. It

Adam Smith as a historian of economic thought  39 is true that certain ideas came up again and again and that there were some tenets that most mercantilistic authors would subscribe to. Those common threads can justifiably be called typically mercantilistic, but one must be careful not to impose a greater degree of unity than there really was. It is for this reason that Schumpeter (1954: 194) speaks of a “quasi-system.” Smith, however, was less careful. His focus on systems led him to see one where there was none and he interpreted the rich and diverse body of mercantilistic literature in terms of what he thought was the mercantilistic system. This “system” he summarizes as follows: The two principles being established, however, that wealth consisted in gold and silver, and that those metals could be brought into a country which had no mines only by the balance of trade, or by exporting to a greater value than it imported; it necessarily became the great object of political œconomy to diminish as much as possible the importation of foreign goods for home-consumption, and to increase as much as possible the exportation of the produce of domestick industry. Its two great engines for enriching the country, therefore, were restraints upon importation, and encouragements to exportation. (WN, IV.i.35: 450) Nonetheless, there are also “good” imports that are not to be discouraged: the imports of raw materials necessary for the production of manufactured goods that, in turn, can be exported. By the same token, there are also “bad” exports that are to be discouraged: the exports of “the materials of manufacture” (WN, IV.viii.1: 642). Having characterized this “system,” Smith proceeds to dismantle it methodically and meticulously. He begins by demonstrating at great length that money (or, specie) is not wealth (WN, IV.i: 429–51). He also shows that bullion is not indispensable as a means of payment, because paper money can always be used to facilitate economic transactions. Thus, there can be no shortage of money (WN, IV.i.15: 437). Therefore, the fixation on a surplus in the balance of trade is totally misguided. Even if it were not, the objective of a permanent trade surplus must be selfdefeating. Smith points out (though in a rather roundabout way) that an inflow of specie tends to raise prices in the country with the trade surplus that will lead to increasing imports and decreasing exports, which, in turn, will worsen the balance of trade (WN, IV.v.a.16–19: 510–3). Last but not least, he shows the many disadvantages of the trade regulations demanded by mercantilism (WN, IV.ii–vi: 452–555). By way of contrast, he extols the virtues of free trade both for individual consumers and for the trading nations (WN, IV.ii.3–14: 453–8). It is here that he uses his famous metaphor of the “invisible hand” (WN, IV.ii.9: 456).

40  Fritz Söllner But how could such an obviously nonsensical “system” as mercantilism ever have come into being – much less have reigned for centuries? For Smith, the answer is as clear as it is simple: It cannot be very difficult to determine who have been the contrivers of this whole mercantile system; not the consumers, we may believe, whose interest has been entirely neglected; but the producers whose interest has been so carefully attended to; and among this latter class our merchants and manufacturers have been by far the principal architects. (WN, IV.viii.54: 661) The argument of Smith is incontrovertible and his verdict is unassailable – if, that is, the “system” of mercantilism as he describes it had ever existed. But it never did exist and by looking at mercantilism with the blinkers of his “system,” Smith could not but fail to do justice to the ideas of the mercantilists. It is true that instances of what Smith regards as the essence of mercantilism can be found in the mercantilistic literature. But there are also many authors who present much more nuanced views. William Petty, John Locke and Thomas Mun, inter alios, make it perfectly clear that wealth does not consist of money. Smith concedes as much but immediately proceeds to observe that “the lands, houses, and consumable goods seem to slip out of their memory, and the strain of their argument frequently supposes that all wealth consists in gold and silver” (WN, IV.i.34: 450) – without bothering to give examples for these alleged slips of memory. Mercantilists were also well aware of the possibilities and the advantages of paper money – which were put forward most persuasively by John Law. Thomas Mun, John Locke, Richard Cantillon and David Hume between them worked out the theory of the specie-flow mechanism that showed that, under certain conditions, a permanent inflow of specie is impossible and that, in the long run, the balance of trade must be in equilibrium. But of course there is no denying that mercantilistic writers were concerned about the balance of trade and that, for them, an export surplus was an important objective of economic policy. How can one possibly reconcile the theoretic insights of the mercantilists with their policy prescriptions? It all boils down to what today is known as the equation of exchange: M × V = P × T (with M the quantity of money, V the velocity of circulation, P the price level and T the real volume of transactions). In the standard Humean interpretation, causality runs from M to P and the automatic equilibrization of the balance of trade results. Cantillon and Locke, on the other hand, focus on the real effects of a change in the supply of money. For them, causality runs from M to T because an increase in the supply of money was thought to stimulate trade and growth. In that case, aiming at a positive balance of trade makes perfect sense: The inflow of specie would lead to growth and not to an increase

Adam Smith as a historian of economic thought  41 in the price level so that even in the longer run, the trade balance need not automatically be in equilibrium. Besides, contrary to what Smith maintains, mercantilism cannot simply be interpreted as an exercise in rent-seeking, a conspiracy to rip off consumers. Rather, it can be explained – and justified – as a strategy to realize the main political objective of the age of mercantilism – the consolidation of the emerging nation states and the expansion of their economic and military power. From this point of view, kings and merchants were natural allies who shared common interests. Of course, Smith took another point of view. For him, individual enrichment was maybe not the only, but certainly the most important objective. From this point of view, free trade is obviously the only policy that makes sense and any concern with the balance of trade is unnecessary at best and harmful at worst. Nonetheless, his opposition to the policies of mercantilism cannot explain the mystery of why Smith almost completely neglects to mention, let alone to discuss, the “enlightened” mercantilists and their theoretical achievements. Mun and Locke are the only mercantilists he refers to – and that in a rather superficial and misleading way. Cantillon, Petty and Law are never quoted – at least not in Book IV. He does not even give credit to his friend David Hume for whose version of the specie-flow mechanism – although he certainly knew about it. Most astonishing, however, is his silence on James Steuart. A fellow Scot, he wrote the most comprehensive treatise on mercantilism and published it nine years before WN appeared (Steuart, 1767). But Smith never deigns to mention Steuart even once in all of WN. There seem to be three reasons for this omission: Firstly, Steuart is clearly no representative of the naïve mercantilism Smith was so fond of attacking. For example, he provides a nuanced discussion of the quantity theory of money and the specie-flow mechanism. Secondly, Steuart warned against general rules or general principles (Steuart, 1767, vol. 1: IX). According to him, economic theories – and, a fortiori, economic policies – are not absolutely right or wrong. Rather, they have to be evaluated in the context of historic circumstances and the stages of economic development. For example, neither free trade nor the regulation of trade à la mercantilism is unambiguously good or bad. At a certain stage of economic development, one may prove to be superior, at another stage, the other. Not only did Steuart thus treat Smith’s “obvious and simple system of natural liberty” (WN, IV.ix.51: 687) on a par with the follies of mercantilism, he also understood scientific progress not in an absolutist but in a relativist way (at least with regard to the social sciences). Steuart’s reasoning ran so contrary to the most cherished beliefs of Smith that, apparently, he simply could not and would not engage with him. Thirdly, Smith was ambitious to establish political economy as a scientific discipline – just like Steuart (1767, vol. 1: V). But there can only be one founder and if you wish to secure this position for yourself, you certainly would want to avoid drawing attention to the work of a precursor and competitor.

42  Fritz Söllner All in all, mercantilism suffered a very unfair treatment at the hands of Adam Smith. He drew a distorted and incomplete picture – a picture that was taken at face value by his successors of the classical school. Whether he simply was carried away by his “systematic” way of thinking that prevented him from appreciating the insights of mercantilistic writers or whether he deliberately ignored and misrepresented them in order to make his own ideas shine brighter, is a question the answer to which I should like to postpone until the final section.

4 Physiocracy The second system of political economy that Smith deals with is physiocracy or, as he prefers to call it, the “agricultural System” (WN, IV.ix: 663). To this system, the IX and last chapter of Book IV is devoted.1 The discussion in this case is both much briefer and much more sympathetic than in the case of mercantilism. For one thing, physiocracy is a coherent and consistent system. In fact, it was the first such system in the history of economic thought. It was based on a few central principles with which the economy was explained and from which the optimal economic policy was deduced. Thus, there was no need for Smith to impose a system where there was none; indeed, he could not have wished for more of a system. He saw the origins of “this very ingenious system” (WN, IV.ix.2: 663) in the criticism of and the reaction to the mercantilistic excesses of Colbert and his policy of promoting industry at the expense of agriculture. The physiocrats were opposed to this policy because, for them, agriculture was the most important part of the economy and its well-being was central to economic development. It was supposed to be the only productive sector because only in this sector a surplus could be produced. Trade and industry, in contrast, were unproductive because these activities could only recover their costs but not generate a net product. As the physiocrats make clear (and as Smith points out, too), this does not mean that trade and industry are useless. By providing agriculture with tools and other manufactured goods, they indirectly contribute to the productivity of agriculture (WN, IV.ix.15: 669). The physiocrats were the champions of free trade and economic liberty that they saw as the best policy to serve the interests of agriculture – and thus of the economy in general. In this way, the surplus of the agricultural sector could be maximized – on the one hand, by having “good prices” for agricultural products, on the other, by creating a competitive supply of the goods agriculture needs as fixed or working capital. Smith describes physiocratic policy as follows: According to this liberal and generous system, therefore, the most advantageous method in which a landed nation can raise up artificers, manufacturers and merchants of its own, is to grant the most

Adam Smith as a historian of economic thought  43 perfect freedom of trade to the artificers, manufacturers and merchants of all other nations. It thereby raises the value of the surplus produce of its own land, of which the continual increase gradually establishes a fund which in due time necessarily raises up all the artificers, manufacturers and merchants whom it has occasion for. (WN, IV.ix.24: 671) Smith mentions the “Oeconomical Table” of François Quesnay (WN, IV.ix.27: 672) which, inter alia, was to show the distribution of the total produce of the land among the three social classes the physiocrats distinguished (land owners, farmers, merchants and manufacturers). According to Smith, however, the system of physiocracy is best explained by PierrePaul le Mercier de la Rivière (1767) and his “little book […] The natural and essential Order of Political Societies” (WN, IV.ix.38: 679). Smith could not agree more with the opposition of the physiocrats to mercantilism and with their liberal economic policies. It comes as no surprise, therefore, that he calls this system “the nearest approximation to the truth that has yet been published upon the subject of political oeconomy” (WN, IV.ix.38: 678). But Smith does find fault with the theoretical centrepiece of physiocracy: its focus on agriculture as the only productive sector. He sees “[t]he capital error […] in its representing the class of artificers, manufacturers and merchants, as altogether barren and unproductive” (WN, IV.ix.29: 674). He goes on to criticize this notion and to show that trade and manufacture are productive after all (WN, IV.ix.29–37: 674–8). But he does not quite succeed and the reader is left with the impression that he exaggerates the difference between the system of the physiocrats and his own theory. Not only did he have to acknowledge that trade and manufacture were regarded as useful by the physiocrats, even if they were not directly productive. He also had to concede that agriculture in fact was more productive than the other sectors because “[f]armers and country labourers, indeed, over and above the stock which maintains and employs them, reproduce annually a neat produce, a free rent to the landlord” (WN, IV.ix.30: 675). It seems that he instinctively knew that the distinction between productive agriculture on the one hand and the unproductive sectors on the other hand was mistaken, but that he could not find the arguments to prove the physiocrats wrong. Maybe, his way of thinking was too close to the reasoning of the physiocrats? In fact, he owed quite a number of important principles and concepts to Quesnay and his followers – not all of which he acknowledged. What he did acknowledge was their “representing the wealth of nations as consisting, not in the unconsumable riches of money, but in the consumable goods annually reproduced by the labour of the society” (WN, IV.ix.38: 678); their insistence on “perfect liberty as the only effectual expedient for rendering this annual reproduction the greatest possible” (WN, IV.ix.38: 678); and their distinction between productive

44  Fritz Söllner and unproductive labour – although he chose to draw the dividing line differently (WN, IV.ix.31: 675). But there are other physiocratic influences in Smith’s work that he is silent about. His conception of the economy as a circular flow; his version of what later became known as Say’s Law; his distinction between gross national product and net national product; and his analysis of the factors determining economic growth: All of that strongly savours of physiocracy. Of course, it is perfectly possible that he came up with these ideas on his own. As Schumpeter (1954: 192) points out, the fact that the physiocrats “hold priority in central points” does not necessarily imply that Smith adopted these points from them. However, it remains a fact that the central ideas of WN were only conceived after his sojourn in France from 1764 to 1766 where he met, among other physiocrats, Quesnay and Anne Robert Jacques Turgot. As Dugald Stewart informs us, it was the acquaintance with the latter, who, behind Quesnay, was the foremost theorist of the physiocrats, that Smith cultivated in particular. The satisfaction he enjoyed in the conversation of Turgot may be easily imagined. Their opinions on the most essential points of political economy were the same; and they were both animated by the same zeal for the best interests of mankind. The favourite studies, too, of both, had directed their inquiries to subjects on which the understandings of the ablest and the best informed are liable to be warped, to a great degree, by prejudice and passion; and on which, of consequence, a coincidence of judgment is peculiarly gratifying. (Life, III.11: 304) And still Smith never even once mentions Turgot – neither in the chapter on physiocracy nor anywhere else in the whole of WN. This omission is at least as astonishing as his silence on James Steuart. Again, as in the case of mercantilism, the reader is left with the impression of a biased and unfair representation of physiocracy. Smith is fulsome with his praise insofar as the physiocrats agree with him, criticizes them severely – and not altogether convincingly – insofar as they do not agree with him and fails to acknowledge many of the intellectual debts he owes them. Condescendingly, he calls the physiocratic system “the nearest approximation to the truth” (WN, IV.ix.38: 678), but leaves no doubt that his own “obvious and simple system of natural liberty” (WN, IV.ix.51: 687) is as superior to the physiocratic system as the latter is to mercantilism.

5  “Plus ça change, plus c’est la même chose” Adam Smith promised to explain the two major systems of political economy, mercantilism and physiocracy: “as fully and distinctly as I can” (WN, IV.intro.2: 428). It would be unfair to expect him to

Adam Smith as a historian of economic thought  45 produce an important contribution to the history of economic thought. After all, economics – or political economy – was then not yet established as a scientific discipline. Still, there is no denying that he did not fulfil his promise because he certainly could have explained mercantilism and physiocracy better than he did. Both in the case of mercantilism and in the case of physiocracy, he was very far from giving a “full and distinct” explanation and from presenting a balanced, unbiased and fair discussion of the ideas of these schools of thought. Partly, this may have been due to his methodological convictions. As regards mercantilism, his focus on systems may have made it hard for him to recognize and acknowledge anything beyond this focus. More importantly, his absolutist interpretation of the history of economic thought may have led him to interpret other theories only from the point of view of his own system. More importantly still, he did not set out to make a contribution to the history of economic thought. Rather, it was with the aim to establish political economy as a separate science and his “obvious and simple system of natural liberty” (WN, IV.ix.51: 687) as the best possible system of this science, that he wrote WN. Inevitably, this ambition also coloured its historiographic Book IV. Therefore, perhaps, he could not and would not do justice to competing theories and give credit in every case where it was due. Instead, he had to make the most of the – real and purported – shortcomings of his predecessors and competitors. From the point of view of academic policy, this may be understandable but it certainly does not represent what we would call – and Smith’s contemporaries would have called – good scholarship. As Schumpeter points out: He acknowledged obligation where honor required it, but not generously. He never uncovered the footprints of predecessors with Darwinian frankness. In criticism he was narrow and ungenerous. (Schumpeter 1954: 182) We may add that it is even debatable whether Smith really in all cases followed the demands of honour. For him, it was certainly more important to prevail in the debate on economic policy than to observe the fine points of scholarly decorum. If we accept these priorities, it is possible to see things in a different light. Ingrid Rima (2009: 97), for example, notes “that The Wealth of Nations contains remarkably few references to the writings of other authors” and admits “that Smith was perhaps less scholarly in this regard than he might have been.” Nonetheless, she passes a rather lenient judgement: He knew precisely […] what to extract from other works and how to use it to make his final product in every way unique and peculiarly his own, although many individual ideas and even illustrations are

46  Fritz Söllner not original to him. Smith is the first of the great eclectics who wove into a harmonious whole the more important ideas of predecessors and contemporaries alike. (Rima, 2009: 97) In any case, however harshly or leniently we may judge the scholarly standards of Smith, his excursion into the history of economic thought admits of only one conclusion: He did not explore the history of ideas for its own sake but used it deliberately as a weapon in the fight over scientific precedence and economic policy. With this approach, Smith comes across as surprisingly modern. Today, as Craufurd Goodwin (2018: 5898) complains, the history of economic thought is mainly performed as “doctrinal cleansing” – as a means to impose intellectual discipline and to guide policy debates. What is more, this kind of history is being written in a rather superficial way and, in most cases, without the involvement of the dwindling circle of serious historians of economic thought. Thus, it seems, we have come full circle: After the history of economic thought came into its own in the 19th century, and after it enjoyed a “golden age” in the first-half of the 20th century, there has been a steady decline – and now we are back, for the most part, to the Adam Smith way of doing history of economic thought. There are many things in Adam Smith that modern economists would do well to emulate. This is not one of them.

Note 1 In the introduction to Chapter IX, Smith speaks of “agriculture systems” (WN, IV.ix.1: 663). It is only physiocracy, however, that he discusses in any detail. Later in this chapter, he describes the agricultural policies of several countries – both ancient and contemporary, but, as he makes clear, these policies cannot be said to be (or, have been) based on systems of political economy (WN, IV.ix.40–47: 679–86).

References Blaug, M., 1992, The Methodology of Economics, 2nd ed., Cambridge University Press, Cambridge. ———, 1997, Economic Theory in Retrospect, 5th ed., Cambridge University Press, Cambridge. du Pont de Nemours, P.S., 1768, De l’origine et des progrès d’une science nouvelle, Desaint, Paris. Goodwin, C.D.W., 2018, “History of Economic Thought”, in R.E. Backhouse et al. (eds.), The New Palgrave Dictionary of Economics, 3rd ed., Palgrave Macmillan, London, vol. 9, pp. 5886–900. Kerr, P., 1993, “Adams Smith’s Theory of Growth and Technological Change Revisited”, Contributions to Political Economy, vol. 12, pp. 1–27.

Adam Smith as a historian of economic thought  47 Le Mercier de la Rivière, P.-P., 1767, L’ordre naturel et essentiel des sociétés politiques, Nourse, London, 2 vols. Rima, I.H., 2009, Development of Economic Analysis, 7th ed., Routledge, New York. Roncaglia, A., 2005, The Wealth of Ideas, Cambridge University Press, Cambridge. Schumpeter, J.A., 1954, History of Economic Analysis, Oxford University Press, New York. Steuart, J., 1767, An Inquiry into the Principles of Political Economy, Millar & Cadell, London, 2 vols.

The virtues of modern man

4 Adam Smith on self-command Utility, dignity, and sympathy Ryan Patrick Hanley

1 Introduction That Adam Smith held the virtue of self-command in high regard is well appreciated today; most recent studies of Smith’s ethics cite his claim that “[s]elf-command is not only itself a great virtue, but from it all the other virtues seem to derive their principal lustre” (TMS, VI.iii.11: 241).1 But less well studied is why Smith held self-command in such high regard. That he would have done so is hardly obvious. Smith himself presents self-command as the virtue characteristic of “rude and barbarous nations” (TMS, V.2.8: 205), and while it is evident why Shaftesbury and Rousseau and other 18th century admirers of pre-modern societies valued self-command, it is not immediately clear why a defender of commercial modernity like Smith championed self-command to the extent that he did. What then explains this? What follows is the argument that Smith’s interest in self-command derives from his recognition of its capacity to further three core elements of his ethical vision: utility, dignity, and sympathy. First, self-command plays a key role in the individual’s self-interested efforts to maximize individual utility. In part, these utility-maximizing efforts aim at material goods. But Smith also thinks that self-command maximizes our pursuits of non-material goods such as esteem and tranquility – a side of self-command that has been less emphasized. And in addition to utility maximization, Smith also values self-command for its role in promoting the realization of dignity, and indeed in ways that go beyond familiar instrumental concerns. On this front, Smith celebrates self-command for its role in enabling individuals to realize their authentic selves. Third, Smith values self-command for its ability to strengthen the bonds of a modern liberal society founded on sympathy and dedicated to equality. In this sense, self-command not only promotes individual well-being but also plays social and political roles. And herein lies one of the distinctive features of Smithian self-command. Where classical theories of selfcommand are often seen (fairly or unfairly) as encouraging insensibility to all sentiments, Smithian self-command discriminates between sentiments. Specifically, Smithian self-command diminishes sensibility to the

DOI: 10.4324/9781003301448-6

52  Ryan Patrick Hanley self but encourages sensibility to others, rendering it especially fitting to modern political orders committed to equality. Reconsidering Smithian self-command through these three lenses of utility, dignity, and sympathy can help us better understand Smith’s reasons for admiring self-command in a modern context. But such a reconsideration is also valuable on three further fronts. First, previous commentators have noted that self-command seems to have “many meanings” in Smith, and one of my aims is to show how these meanings hang together and deserve to be seen as complementary faces of a single disposition. 2 Second, one of the most vexing and long-standing issues for Smith scholars is Smith’s orientation to Stoicism. But attending to his definition of self-command can help us pinpoint precisely what Smith shares with Stoicism – a belief in the necessity and nobility of transcending selfish passions – and precisely what he rejects in Stoicism – what he takes to be its “indifference” not only to self but others. In addition, attending to Smith’s theory of self-command sheds light on one of the most perplexing elements of his ethics: its near-total silence on freedom and the will. In fact, Smith’s treatment of self-command is a proxy for these concepts, and thus, in a different vein, anticipates much that would soon after be made explicit by Kant.

2  Self-command and utility One familiar aim of self-command is to maximize individual utility through advancing self-interest. Smith provides his clearest statement of this side of self-command in his treatment of utility in Part IV of The Theory of Moral Sentiments (TMS). Here, he says the two “qualities most useful to ourselves” are “superior reason and understanding, by which we are capable of discerning the remote consequences of all our actions,” and “self-command, by which we are enabled to abstain from present pleasure or to endure present pain, in order to […] avoid a greater pain in some future time;” Smith labels this union of foresight and self-command “prudence,” and labels it “of all the virtues that which is most useful to the individual” (TMS, IV.2.6: 189). But, for us, what matters is the specific role self-command plays in this process. Self-command, as presented here, is not any mere exercise of temperance or moderation of appetites, but one governed by a utility-maximizing calculation: the virtue “by which we restrain our present appetites, in order to gratify them more fully upon another occasion” (TMS, IV.2.8: 189, italics added). Self-command is then not just an act of restraint but an act of restraint for the sake of which present desires are sacrificed in hopes of greater future returns. This side of self-command has clear implications for Smith’s economics, and renders it especially well-suited to a commercial society that rewards savings and investment over short-term speculation or

Adam Smith on self-command  53 immediate consumption.3 Yet there is also something more at work here. Those who exercise self-command in order to control immediate appetites not only reap greater material rewards in the future, but also reap other goods in the present. Smith explains how this works in his account of the prudent man: In the steadiness of his industry and frugality, in his steadily sacrificing the ease and enjoyment of the present moment for the probable expectation of the still greater ease and enjoyment of a more distant but more lasting period of time, the prudent man is always both supported and rewarded by the entire approbation of the impartial spectator, and of the representative of the impartial spectator, the man within the breast. […] He cannot therefore but approve, and even applaud, that proper exertion of self-command, which enables them to act as if their present and their future situation affected them nearly in the same manner in which they affect him. (TMS, VI.i.11: 215) Here Smith describes a very specific but very important positive externality that the exercise of self-command generates. The prudent man, seeking only to maximize his returns over time, trains himself to devalue his present passions. Yet his exercise of self-command reaps not only greater material gains in the long run but also esteem and admiration of spectators. For the prudent man, in exercising his self-command, comes to regard his future self and his present self as of equal value in precisely the way that a spectator, who has no direct access to the sensations of others, would be compelled to regard him: The spectator does not feel the solicitations of our present appetites. To him the pleasure which we are to enjoy a week hence, or a year hence, is just as interesting as that which we are to enjoy this moment. (TMS, IV.2.8: 189) The spectator who cannot feel what we feel can only access our passions by imagining them, and thus “when we abstain from present pleasure, in order to secure greater pleasure to come, when we act as if the remote object interested us as much as that which immediately presses upon the senses,” the spectator “cannot fail to approve of our behavior” as “our affections exactly correspond with his own;” this effort to achieve the same orientation to our passions that a spectator of our passions must have toward them necessarily elicits the “wonder and admiration” of the spectator who is all too aware how rare such spectacles of self-overcoming are (TMS, IV.2.8: 189). Here, and elsewhere, Smith is chiefly concerned to demonstrate to us that the virtues of “self-command are, upon most occasions, principally

54  Ryan Patrick Hanley and almost entirely recommended to us” by “the sense of propriety, by regard to the sentiments of the supposed impartial spectator;” selfcommand is itself thus best understood in this sense as an attempt to reduce “all those mutinous and turbulent passions into that tone and temper which the impartial spectator can enter into and sympathize with” (TMS, VI.concl.2: 262–3). Indeed, the mechanism that drives us to cultivate self-command is the one that undergirds sympathetic exchange more broadly: namely, recognition of the disparity between our sensitivity to ourselves and the relative insensibility of other spectators to us.4 This is especially evident in Smith’s account of sympathy with bodily pain: The little sympathy which we feel with bodily pain is the foundation of the propriety of constancy and patience in enduring it. The man, who under the severest tortures allows no weakness to escape him, vents no groan, gives way to no passion which we do not entirely enter into, commands our highest admiration. His firmness enables him to keep time with our indifference and insensibility. We admire and entirely go along with the magnanimous effort which he makes for this purpose. We approve of his behaviour, and from our experience of the common weakness of human nature, we are surprised, and wonder how he should be able to act so as to deserve approbation. Approbation, mixed and animated by wonder and surprise, constitutes the sentiment which is properly called admiration […]. (TMS, I.ii.1.12: 30–1) Smith’s language here is lovely: to command one’s self is ultimately to “command” the highest admiration of others. The moderated sensibility to ourselves that self-command makes possible replicates the relative insensibility that spectators of our situation necessarily feel toward us. Self-command is inseparable from the mechanisms of sympathy, but, for our purposes, it is the adoption of this impartial attitude toward ourselves that makes self-command so remarkable. It is remarkable first because when we come to regard ourselves and our feelings at that same low pitch at which others regard us and our feelings, we demonstrate the degree to which we have learned what Smith calls the “hardest of all the lessons of morality”: the humbling of our self-love and our predilection to prefer ourselves to others that prevents us from appreciating others as equals (TMS, III.3.8: 139).5 It is remarkable in a second way too: what began as a mere attempt to maximize pursuit of material external goods has now emerged as an act worthy of approbation; hence Smith’s emphasis on the eminent esteem with which all men naturally regard a steady perseverance in the practice of frugality, industry, and application, though directed to no other purpose than the acquisition of fortune. (TMS, IV.2.8: 189–90)

Adam Smith on self-command  55 Smith’s emphasis on this “eminent esteem” is important for several reasons. First, Smith here aims to redeem the so-called “bourgeois virtues” from familiar criticisms.6 Smith disparages indiscriminate pursuit of self-interest, especially that dedicated solely to self-gratification driven by greed (WN, III.iv.10: 418–9), but the “eminent esteem” elicited by the pursuit of material goods governed by self-command is meant to distinguish such pursuits from simple greed. In addition, he distinguishes estimable self-command from other less estimable displays of selfcommand for non-economic purposes. Smith often suggests that self-command is a double-edged sword. The more grandiose exercises of self-command of the warrior, he knows, often elicit the esteem of spectators dazzled by their grandeur even when their effects are unjust. Smith is keen to disabuse us of this mistaken esteem, as has been shown.7 But he is also eager to show that lesser exertions of self-command can be at once both just and estimable: “[t]emperance, decency, modesty, and moderation, are always amiable, and can seldom be directed to any bad end,” and indeed “the unremitting steadiness of those gentler exertions of self-command,” is what gives rise to the “sober lustre” that attends them (TMS, VI.iii.13: 242). Self-command thus maximizes our pursuits of esteem as well as our pursuits of material goods. But self-esteem maximizes not just our pursuits of external goods but also our pursuits of internal goods, and, especially, tranquility. A defining feature of the prudent man is the satisfaction with present circumstances that renders him insensitive to future temptations; having “no anxiety to change so comfortable a situation,” he “does not go in quest of new enterprises and adventures, which might endanger, but could not well increase, the secure tranquility which he actually enjoys” (TMS, VI.i.12: 215). Smith sees that there can be an ignoble side to this insofar as it can lead one to shy away from striving for “the real and solid glory of performing the greatest and most magnanimous actions” (TMS, VI.i.13: 216). But if tranquility is in fact indispensable to happiness, the self-command that leads us to restrain our appetites and prefer tranquility to indiscriminate striving is of remarkable value.

3  Self-command and dignity Until now, we have focused on the instrumental benefits of selfcommand. Yet Smith’s focus on instrumental benefits is only one side of his multifaceted treatment. For beyond enabling us to reap external goods, Smith also regards self-command as indispensable to the realization of our dignity.8 This will necessarily sound like a sharp departure from the way in which self-command was discussed above, and, in one important sense, it is. The self-command that helps us realize our dignity is a self-command

56  Ryan Patrick Hanley that focuses less on how we are seen by others than on how we see ourselves; in this sense, the self-command that helps us realize our dignity is less concerned with how our own feelings are seen by spectators and more concerned with how we ourselves evaluate our feelings in light of our image of what our feelings ought to be. The referent here shifts from external to internal: from “the real spectator” in the world to the “representative of the impartial spectator, the man within the breast” (TMS, VI.i.11: 215).9 Yet this is less a substantive shift from his earlier position than an extension of it. Just as self-command before depended on comparing what we are to how we are seen by others, this new sense of self-command depends on comparing what we are to our image of what we believe ourselves capable of being or becoming – the self that we, in our best moments, have determined we want to be. Dignity, on Smith’s account, thus lies in a capacity to act in accord with our image of what we believe ourselves capable of becoming.10 And self-command, in turn, plays a crucial role in our efforts to realize this dignity in practice by empowering us to resist those inclinations that would lead us to act in a manner inconsistent with this image. Smith’s account of the relationship of self-command to dignity begins early in the text and runs parallel to the accounts of instrumental self-command examined in the previous section. It first emerges in his delineation of the “two different sets of virtues” he identifies with spectators’ efforts to accommodate themselves to actors and actors’ efforts to accommodate themselves to spectators. In a conspicuous use of terms likely borrowed from Hume (see e.g. Raphael, 2007: 66–7), Smith divides the virtues into the “the soft, the gentle, the amiable virtues, the virtues of candid condescension and indulgent humanity,” and the great, the awful and respectable, the virtues of self-denial, of self-government, of that command of the passions which subjects all the movements of our nature to what our own dignity and honour, and the propriety of our own conduct require […]. (TMS, I.i.5.1: 23) Herein lies the start of his account of self-command’s relationship to dignity, for with this claim Smith embarks on a new inquiry, shifting focus from what self-command does to why it does it. And in so doing, Smith makes clear that self-command is valuable not because we ought to regard the sentiments as somehow pernicious (an untenable position for a sentimentalist) or needing to be suppressed for the sake of greater future returns.11 In fact, the story is more complex, for Smith sees that self-command also makes possible a type of conduct “required” by the demands of our dignity and honor.

Adam Smith on self-command  57 This process begins with a subtle but important shift from concern with external spectators to self-spectatorship, which allows Smith to shift focus from the approbation of others to self-approbation. This shift is especially clear in Part III of TMS, dedicated to “the Foundation of our Judgments concerning our own Sentiments and Conduct” (TMS, III: 109). Here, as in the earlier account of self-command’s utility, the key issue concerns the relationship of feeling to action. Yet whereas earlier the focus was on resisting present feelings for the sake of greater payoffs in time, here the benefit comes not in the form of external goods but rather in the self-approbation that is the result of an individual’s “sense of honour” and “regard to his own dignity;” indeed “[w] hen he follows that view which honour and dignity point out to him,” he “enjoys his own complete self-approbation, and the applause of every candid and impartial spectator” (TMS, III.3.28: 148). Thus the key claim: The degree of self-approbation with which every man, upon such occasions, surveys his own conduct, is higher or lower, exactly in proportion to the degree of self-command which is necessary in order to obtain that self-approbation. (TMS, III.3.26: 147)12 Smith here retains the language of the impartial spectator, but the key move being made is that this is no longer an impartial spectator “out there,” but now one who is very much in us as we “survey [our] own conduct” (TMS, III.3.26: 147), and who, unlike impartial spectators “out there,” generates sentiments in its own right that we feel directly. In the passage quoted above, Smith calls this generated sentiment “selfapprobation,” and in the passage preceding this, he explains that [i]n proportion to the degree of the self-command which is necessary in order to conquer our natural sensibility, the pleasure and pride of the conquest are so much the greater; and this pleasure and pride are so great that no man can be altogether unhappy who completely enjoys them. (TMS, III.3.27: 147) A full treatment of self-approbation in Smith would require a study of its own. But for our purposes what matters is that self-approbation is a) a sentiment generated by the impartial spectator who is in us rather than outside us; and b) a pleasing sentiment that enables us to experience a legitimate pride in an unmediated way. Self-approbation is then a pleasurable reward that comes directly from self-command, and distinct from the rewards associated with external goods.

58  Ryan Patrick Hanley Key to this process is then the way in which self-command enables us to live up to our self-image. But how do we form this self-image in the first place? Smith explains this in his introduction to the chapter dedicated to self-command in Part VI of TMS: The man who acts according to the rules of perfect prudence, of strict justice, and of proper benevolence, may be said to be perfectly virtuous. But the most perfect knowledge of those rules will not alone enable him to act in this manner: his own passions are very apt to mislead him; sometimes to drive him and sometimes to seduce him to violate all the rules which he himself, in all his sober and cool hours, approves of. The most perfect knowledge, if it is not supported by the most perfect self-command, will not always enable him to do his duty. (TMS, VI.iii.1: 237) The key category here is the rules that the individual has drawn up “in all his sober and cool hours.” The same locution is used elsewhere in a parallel passage, in which Smith describes “[t]hose general rules of conduct” that “are of great use in correcting the misrepresentations of self-love” (TMS, III.4.12: 160). However tempted one might be, in the grip of passions, to violate such rules, that reverence for the rule which past experience has impressed upon him, checks the impetuosity of his passion, and helps him to correct the too partial views which self-love might otherwise suggest, of what was proper to be done in his situation. If he should allow himself to be so far transported by passion as to violate this rule, yet, even in this case, he cannot throw off altogether the awe and respect with which he has been accustomed to regard it. At the very time of acting, at the moment in which passion mounts the highest, he hesitates and trembles at the thought of what he is about to do: he is secretly conscious to himself that he is breaking through those measures of conduct which, in all his cool hours, he had resolved never to infringe, which he had never seen infringed by others without the highest disapprobation, and of which the infringement, his own mind forebodes, must soon render him the object of the same disagreeable sentiments. (TMS, III.4.12: 161) This passage is important for debates over Smith’s relative commitments to deontological ethics and virtue ethics, as well as his understanding of anxiety. But, for us, its import lies in how it portrays the inner struggle of one caught up in the passions that self-command seeks to control. On this front, the key claim is that the chief point at issue is not a

Adam Smith on self-command  59 comparison between what such a person feels and how other spectators judge him, but rather the relative conformity between what such a person feels and does and how it comports with conception of himself as developed at a prior time – that is, in those “cool moments” in which he was most himself, able to form the clearest possible image of the person he wished to be, without his image being clouded or otherwise obscured by countervailing passions that might disturb the clarity of his selfimagining.13 Self-approbation thus comes not when we ignore or suppress our passions, but when we express them in actions that conform to the image of ourselves that we would choose for ourselves even independent of such a passion. Smith is thus committed to the notion that the exercise of selfcommand is valuable, beyond whatever instrumental utility it might have, for how it helps us to realize our dignity. But self-command is also tied to dignity in a second interesting way. Smith not only believes that human beings possess dignity qua persons, but also that the passions themselves, when properly expressed, have dignity. Indeed just as one acting with self-command comes to realize their dignity as a person, so too expressions of discrete sentiments realize a certain dignity when expressed in ways governed by self-command: what noble propriety and grace do we feel in the conduct of those who, in their own case, exert that recollection and self-command which constitute the dignity of every passion, and which bring it down to what others can enter into! We are disgusted with that clamorous grief, which, without any delicacy, calls upon our compassion with sighs and tears and importunate lamentations. But we reverence that reserved, that silent and majestic sorrow, which discovers itself only in the swelling of the eyes, in the quivering of the lips and cheeks, and in the distant, but affecting, coldness of the whole behaviour. It imposes the like silence upon us. We regard it with respectful attention, and watch with anxious concern over our whole behaviour, lest by any impropriety we should disturb that concerted tranquility, which it requires so great an effort to support. (TMS, I.i.5.3: 24) Here the object of dignity is not the human being but the individual passions, each of which has its own dignified and undignified expressions. Smith makes this clear via several examples; in the passage above, he notes that sorrow can be “majestic” when expressed in a certain way, and in what immediately follows, he explains that even anger, which is legitimately seen as “detestable” when governed by “insolence and brutality” and indulged “without check or restraint,” can be a “noble and generous resentment” when governed by self-command (TMS, I.i.5.4: 24). This is important insofar as it shows a new perspective on

60  Ryan Patrick Hanley the relationship of self-command to sentiment. In particular, it suggests that Smith hardly opposed all forms of sentiment in a manner akin to a sort of caricatured Stoicism or Kantianism.14 Instead, he suggests that an agent’s proper aim is to strive for dignified expression of sentiment, mediated by a self-command that moderates sentiments in a way that spectators and self-spectators alike can approve. By thus domesticating self-command within his sentimental theory, Smith suggests a route whereby self-command and sentimentalism might be harmonized. The key point is that we now have a form of self-command that goes further than mere maximized utility. And this association of selfcommand with a dignity beyond utility indeed constitutes a sort of noble perfection that represents of a peak of ethical virtue in its own right: The man who feels the full distress of the calamity which has befallen him, who feels the whole baseness of the injustice which has been done to him, but who feels still more strongly what the dignity of his own character requires; who does not abandon himself to the guidance of the undisciplined passions which his situation might naturally inspire; but who governs his whole behaviour and conduct according to those restrained and corrected emotions which the great inmate, the great demi-god within the breast prescribes and approves of; is alone the real man of virtue, the only real and proper object of love, respect, and admiration. Insensibility and that noble firmness, that exalted self-command, which is founded in the sense of dignity and propriety, are so far from being altogether the same, that in proportion as the former takes place, the merit of the latter is, in many cases, entirely taken away. (TMS, VI.iii.18: 245) Self-command is thus a virtue concerned not merely to repress the worst parts of the self, but one that enables us to realize the best parts of ourselves – and indeed one that, as we shall particularly see in what follows, must never be confused with “insensibility.”

4  Self-command and sympathy Self-command, in the senses in which we have examined it to this point, has been largely presented as an individual rather than a social virtue. In its connection with utility, it is valued for the external goods it brings to the individual, and in its connection with dignity, it is valued for the way it promotes an individual’s self-approbation. But Smith also conceived of self-command as having a social function – indeed two discrete social functions – and it is in his articulation of these social functions that his innovations as a theorist of self-command chiefly lie. First, Smith regards self-command as a product of social interaction. The mechanisms of

Adam Smith on self-command  61 self-command, that is, go beyond matters internal to discrete individual agents; far from being limited to the internal struggles of an individual agent seeking to resist or overcome passions and achieve a sense of selfapprobation and internal harmony, Smith also understands self-command as a means of fostering social harmony. Further, self-command is social in a second and more normative way insofar as it serves to advance the egalitarian social vision that Smith is concerned to promote. We begin with the social origins of self-command. In the previous section, we saw that Smith conceives of self-command as promoting our concern with our own dignity. Yet this concern to live up to our selfimage is not born in quiet and solitary reflection; self-command, as we have already had occasion to note, is born in give-and-take exchanges of sympathy in the real world.15 And elsewhere, the text is especially clear on this: If we examine the different shades and gradations of weakness and self-command, as we meet with them in common life, we shall very easily satisfy ourselves that this control of our passive feelings must be acquired, not from the abstruse syllogisms of a quibbling dialectic, but from that great discipline which Nature has established for the acquisition of this and of every other virtue; a regard to the sentiments of the real or supposed spectator of our conduct. (TMS, III.3.21: 145) The key point is that this process cannot be internal in its initial forms, but can only be “acquired” in the course of iterated interactions with others. Thus while an isolated young child “has no self-command,” this changes “[w]hen it is old enough to go to school, or to mix with its equals”: It naturally wishes to gain their favour, and to avoid their hatred or contempt. Regard even to its own safety teaches it to do so; and it soon finds that it can do so in no other way than by moderating, not only its anger, but all its other passions, to the degree which its play-fellows and companions are likely to be pleased with. It thus enters into the great school of self-command, it studies to be more and more master of itself, and begins to exercise over its own feelings a discipline which the practice of the longest life is very seldom sufficient to bring to complete perfection. (TMS, III.3.22: 145) And as this child grows, the self-command first discovered in the society of his play-fellows in the schoolyard is further developed until it reaches its fruition in “[t]he man of real constancy and firmness, the wise and just man who has been thoroughly bred in the great school of self-command, in the bustle and business of the world,” who “maintains

62  Ryan Patrick Hanley this control of his passive feelings upon all occasions; and whether in solitude or in society” (TMS, III.3.25: 146). Self-command thus must not be understood as merely a self-concerned, self-centered virtue. While self-regulation of self-centered sentiments is clearly its aim, it does so to facilitate a certain type of relationship with others that is at once good for both self and society. The above account also helps us see that self-command is hardly inimical to sentiment. Far from seeking to suppress sentiment, self-command depends on our sensitivity to sympathy for it to emerge. And self-command is also tied to sympathy in a second way. Smith has a unique conception of human excellence: “to feel much for others and little for ourselves” and “to restrain our selfish, and to indulge our benevolent affections, constitutes the perfection of human nature” (TMS, I.i.5.5: 25); so too he argues, “[t]he man of the most perfect virtue” is “he who joins, to the most perfect command of his own original and selfish feelings, the most exquisite sensibility both to the original and sympathetic feelings of others” (TMS, III.3.35: 152). On its face, this seems paradoxical. Yet Smith believes he has good reasons to defend this conception of excellence – reasons that emerge directly from his theory of the social origins of self-command. As we saw, Smith understands self-command as born in our regard to the sympathetic judgments of the spectator. He goes on to claim that as we become more sensitive to the feelings and judgments of others, we become more capable of cultivating selfcommand – indeed to the point of arguing that “[t]he man of the most exquisite humanity, is naturally the most capable of acquiring the highest degree of self-command” (TMS, III.3.36: 152), and thus sensibility to the feelings of others, so far from being inconsistent with the manhood of self-command, is the very principle upon which that manhood is founded as [t]he very same principle or instinct which, in the misfortune of our neighbour, prompts us to compassionate his sorrow; in our own misfortune, prompts us to restrain the abject and miserable lamentations of our own sorrow. (TMS, III.3.34: 152)16 In this way, Smith seeks to solve a main problem in 18th century British moral philosophy by showing that the other-directed and the self-directed sentiments are resolvable via a full understanding of self-command. Further, Smith’s claim on this front reveals the depth of his belief that moderated sensibility to the self is born in maximized sensibility to others rather than insensibility to others.

Adam Smith on self-command  63

5  Conclusion: Stoicism and Kantianism Smith’s claim that the moderated sensibility to the self that lies at the heart of self-command is born in sensibility to others has important implications for how we understand the relative originality of his theory of self-command, and indeed how we position his theory vis-à-vis the well-known conceptions of self-command set forth by the ancient Stoics and by Kant. The question of Smith’s ostensible Stoicism has long exercised scholars, with many arguing that his ethics is largely drawn from and conforms to Stoicism, while others, especially more recently, have pointed to his explicit critiques of Stoicism (especially in the sixth edition of TMS) as evidence of a conscious disassociation from Stoicism.17 In fact, each camp seems half-right, and the ways in which each is half-right is itself helpfully illuminated by attending to his views on self-command. As emphasized above, one of Smith’s aims as a theorist of self-command is to show how self-command can be domesticated in a sentimentalist moral theory by reconsidering self-command’s orientation to sentiment, and indeed to sensibility and insensibility more generally. Smith’s position on this front is that self-command, far from encouraging or demanding insensibility to sentiment in any broad sense, requires something more nuanced. Specifically, for it to be maximally effective, self-command requires moderated sensibility to self-focused sentiments, and increased sensibility to other-focused sentiments. Here though is precisely where Stoicism goes awry according to Smith. Stoic self-command, on his view, fails to discriminate sufficiently between these two types of sentiment and instead champions universal insensibility. In so doing, Stoicism, Smith thinks, rightly captures the nobility and praiseworthiness of insensibility to the selfish sentiments; hence his approving reference to Seneca’s Cato as a model of self-insensibility (e.g. TMS, I.iii.1.13: 48). Yet Stoicism, on Smith’s view, also encourages an insensibility to others that is unworthy of virtuous individuals and thus cannot be countenanced. Taken together, Smith admires and embraces Stoic “indifference” applied to self-regarding concerns, but rejects the Stoic extension of indifference to others.18 Put in terms of Smith’s direct claims on Stoicism, Smith cannot but approve of Stoic firmness toward the self; his foundational claim that self-command demands we occupy the perspective of the impartial spectator (e.g. TMS, III.3.25: 146–7) is precisely a development of what he describes as the Stoic insistence that [w]e should view ourselves, not in the light in which our own selfish passions are apt to place us, but in the light in which any other citizen of the world would view us. (TMS, III.3.11: 140–1)

64  Ryan Patrick Hanley But for all his sympathy with that claim, Smith condemns the “unnatural indifference” (TMS, III.3.13: 142) of one “who appears to feel nothing for his own children,” disparaging him “of all brutes the most detestable” (TMS, III.3.14: 143). Indeed however admirable indifference to selfish sentiments may be, indifference to the well-being of others is “never agreeable,” and “all the metaphysical sophisms by which it is supported can seldom serve any other purpose than to blow up the hard insensibility of a coxcomb to ten times its native impertinence” (TMS, III.3.14: 143). Even worse, the Stoics regarded “the amiable, the gentle virtues, all the virtues of indulgent humanity” as “mere weaknesses which it behoved a wise man not to harbour in his breast” (TMS, VII.ii.4.2: 306). Thus his final swipe at Stoicism for recommending “the perfect apathy” by which in fact it endeavours to render us altogether indifferent and unconcerned in the success or miscarriage of every thing which Nature has prescribed to us as the proper business and occupation of our lives. (TMS, VII.ii.1.46: 292–3)19 Smith’s discussion of self-command thus does a tremendous amount of work; not only does it mark out an original conception of self-command independent from the ancient models of the Stoics by which it was clearly influenced, but it also serves to promote the discrete ends of utility, dignity, and sympathy that are central to the larger ethical system that Smith sets forth. But perhaps the most remarkable aspect of this entire theory is that Smith develops it entirely without reference to what are classically taken to be the two foundational points of departure for any discussion of self-command understood as control of the inclinations: freedom and will. Smith’s theory, as we have seen, is articulated in a very different mode, one that specifically avoids approaching questions of self-command from a perspective that is now very well-entrenched. 20 At the same time, the notion of a free individual who can make choices based on the will does seem to be, as others have argued, “presupposed” in Smith, even if not argued explicitly (see esp. Otteson, 2002: 238–9; cf. Carrasco, 2012: 393–4, 398–9). What are we to make of this? Some will no doubt see it as emblematic of Smith’s failure to embrace or measure up to the technical sophistication of Kant. But others may see it as a liberating way of understanding and discussing key elements of self-command without being mired in certain familiar problems that discussions of freedom and will often become quickly associated – the Kantian conception of human dignity not least among them.

Notes 1 Key studies of self-command with which this chapter engages and which cite this passage include Griswold, 1999: 203; Montes, 2004: 53, 77, 109;

Adam Smith on self-command  65 Brennan, 2007: 111; Raphael, 2007: 80; Carrasco, 2012: 401; Herzog, 2013: 123; Montes, 2020: 128, 136. 2 The quoted claim is from Montes, who notes that even prior to the sixth edition, Smith seems to use self-command to describe the awful virtues, Epicurean ataraxia, self-mastery, and “complete physical and psychological self-denial” (Montes, 2004: 78; see also Montes, 2020: 130). Carrasco has developed this claim by focusing on two discrete senses of self- command in Smith as “pre-moral habit” and “moral virtue” (2004: 392–3; cf. 404). 3 Especially helpful on this front is Davis, 2003: esp. 291–9; see also Khalil, 2010: esp. 184–5, 189; Meardon and Ortmann, 1996: 57–61, 64–66; and Herzog, 2013: 122. Meardon and Ortmann are particularly concerned to present what they call “an intrapersonal, rational-choice model of selfcommand” (1996: 60), and helpfully present Smith’s account of how we “rely on our active principles in order to resist our short-run impulses” (1996: 61). But for reasons to be discussed below I think they go too far in identifying the “long-run payoffs” of such efforts with “grandeur” and “dignity” (1996: 61, cf. 71). 4 For helpful accounts of this process, see e.g. Fleischacker, 1999: 155; Otteson, 2002: 55–6; Khalil, 2010: 181; Debes, 2012: 11415. For an especially helpful and detailed account of how this process specifically applies to the generation of self-command, see Kopajtic, 2020: esp. 10–5, 19. 5 Brennan provides an interesting contemporary application of Smith’s theory on this front in what he calls “Adam Smith’s theory of modesty” (Brennan, 2007: 118), and which is especially helpful in calling attention to the way in which Smith’s virtuous agent strives at once for “self-respect, selfrealization, and respect for the good” (2007: 123). For a particularly useful account of this process, see Debes, 2012: 113–5. 6 On Smith and the bourgeois virtues, see e.g. McCloskey, 2006: 305–7; cf. Herzog, 2013: 90–1. 7 See e.g. Montes, 2004: 77–8; Hanley, 2009: 162–74; and Carrasco, 2012: 392, 403–5. 8 Khalil similarly points to a “source of satisfaction, related to approbation” which goes beyond utility, but identifies this with a “sense of integrity” and “self-satisfaction arising from acting with propriety,” rather than dignity and self-approbation (2010: 182–3). In this respect my view is closer to Griswold (1999: 203), and with Montes, who nicely notes the ways in which self-command is tied to the process of “inner moral assessment” culminating in self-approbation (2020: 129). 9 Montes likewise calls attention to this shift (2004: 109), and while he suggests that this leads Smith down the path of deontology, he helpfully notes that is at least a shift away from the more utilitarian sense of self-command (see esp. 117; see also Vivenza, 2001: 56). Khalil also helpfully distinguishes “the spectator within” from “the spectator without” and notes that the two are “ultimately autonomous of each other,” but is principally concerned to demonstrate the economic consequences of this distinction (2010: 184). 10 The conception of Smithian dignity that I develop here and below should be read alongside that helpfully developed by Remy Debes. In his efforts to demonstrate Smith’s relevance in helping to articulate an account of what he calls “affective dignity” capable of supporting Smith’s egalitarian claims, Debes largely separates his account of dignity from Smith’s account of self-command (though see 2012: 110–1, 127). Carrasco also connects self-command to dignity but in a way different from both Debes and from the account offered here, focusing on autonomy (2012: 412).

66  Ryan Patrick Hanley 11 For an important statement of the compatibility of Smithian self-command with his sentimentalism, see Kopajtic, 2020: esp. pp. 7–8, 15. 12 Carrasco similarly and very nicely notes that self-command plays a key role in the process of generating the “self-distancing that allows self-determination.” Yet she frames this process as one specifically governed by “reason,” whereas on my reading, Smith emphasizes less the role of reason in this process than the role of the desire to realize our dignity (2012: 394; cf. 395, 397–8, 412). Kopajtic similarly distances her reading from Carrasco’s rationalism, albeit on the grounds of sentimentalism rather than dignity (2020: 20–1). 13 Carrasco, while emphasizing the rationality of self-command to a higher degree than my account does, makes a similar claim in her helpful account of self-command as “a practical habit, an expression of practical reason” that “enables us to discipline our passions in order to guide our lives according to our deliberate intentions” (2012: 399). 14 In this, I follow Montes’ helpful reading of Smith on Stoic apatheia (see Montes, 2004: 80); see also Griswold, 1999: 212. 15 See in this vein, Herzog’s helpful account of why self-command “can be acquired only in society” and how living in a community demands that “self-consciousness and self-control have to concur: by sympathy one assumes the standpoint of others, self-consciously toning down one’s emotions to the level they can share through self-control” (2013: 63–4). A similar way of defining the problem is developed in Fleischacker, 1999: 153, 156. 16 For a developed reading of this passage, see Kopajtic, 2020: 11ff. 17 Among the most important critics of the association of Smith with Stoicism is Montes, who helpfully and convincingly demonstrates that Smith’s conception of self-command in particular is shaped by his engagement not simply with Stoic sources, but also with the ancient Greek conception of enkrateia and the civic humanist vir virtutis tradition (Montes, 2004: 11–3, 78–9, 86, 111; 2020: 132–3; cf. Kopajtic, 2020: 19–20). 18 My distinction of Smith from Stoicism on this front differs from but I believe is yet compatible with Montes’ helpful examination of Smithian self-command from the standpoint of moral motivation, which presents it as “a kind of enabling virtue that allows us to do what is appropriate” (2020: 135), one that goes beyond the “Stoical virtue focused on what not to do,” and incorporates a focus on “what to do” (2004: 132). 19 See also Vivenza’s parallel account of Smith’s mitigated Stoicism and his critique of Stoic apathy “on the grounds that the coldness it imposes on the warmest affections is in reality unnatural and offensive to propriety” (2001: 57–9) and encourages “a species of indifference” (74–8; quote at 78). A similar claim is made by Bee and Paganelli, who read Smith as opposed to hard-line Stoic self-command and its “total lack of sensibility” (2019: 5) on the grounds that such an ethics is fit only for indigent rather than opulent ages, which require something other than “a complete suppression of the expression of our passions” (7). 20 On Kant’s conception of self-command, see esp. Wilson, 2015. Wilson’s study helps to clarify what Smith’s conception of self-command shares with Kant’s – namely what Wilson calls “proficiency at sticking to the results of self-legislation” (1; see also 16–7) – as well as exactly how Smith’s conception differs from Kant’s – chiefly in the fact that for Kant, as Wilson notes, self-command is ultimately “a property of the will” (3). In this context, see also Debes’ useful distancing of Smithian “affective dignity” from post-Kantian conceptions of dignity (2012: 128, 138–9).

Adam Smith on self-command  67

References Bee, M. & M.P. Paganelli, 2019, “Adam Smith, Anti-Stoic”, CHOPE Working Paper, no. 2019/02. Brennan, J., 2007, “Modesty Without Illusion”, Philosophy and Phenomenological Research, vol. 75, no. 1, pp. 111–28. Carrasco, M.A., 2012, “Adam Smith: Self-Command, Practical Reason and Deontological Insights”, British Journal for the History of Philosophy, vol. 20, no. 2, pp. 391–414. Davis, G.F., 2003, “Philosophical Psychology and Economic Psychology in David Hume and Adam Smith”, History of Political Economy, vol. 35, no. 2, pp. 269–304. Debes, R., 2012, “Adam Smith on Dignity and Equality”, British Journal for the History of Philosophy, vol. 20, no. 1, pp. 109–40. Fleischacker, S., 1999, A Third Concept of Liberty: Judgment and Freedom in Kant and Adam Smith, Princeton University Press, Princeton. Griswold, C.L., Jr., 1999, Adam Smith and the Virtues of Enlightenment, Cambridge University Press, Cambridge. Hanley, R.P., 2009, Adam Smith and the Character of Virtue, Cambridge University Press, Cambridge. Herzog, L., 2013, Inventing the Market: Smith, Hegel, and Political Theory, Oxford University Press, Oxford. Khalil, E.L., 2010, “Adam Smith’s Concept of Self-Command as a Solution to Dynamic Inconsistency and the Commitment Problem”, Economic Inquiry, vol. 48, no. 1, pp. 177–91. Kopajtic, L., 2020, “Adam Smith’s Sentimentalist Conception of Self-Control”, The Adam Smith Review, vol. 12, pp. 7–27. McCloskey, D., 2006, The Bourgeois Virtues: Ethics for an Age of Commerce, University of Chicago Press, Chicago. Meardon, S.J. & A. Ortmann, 1996, “Self-Command in Adam Smith’s Theory of Moral Sentiments: A Game-Theoretical Reinterpretation”, Rationality and Society, vol. 8, no. 1, pp. 57–80. Montes, L., 2004, Adam Smith in Context: A Critical Reassessment of Some Central Components of His Thought, Palgrave Macmillan, London. ———, 2020, “The Relevance of Propriety and Self-Command in Adam Smith’s Theory of Moral Sentiments”, Social Philosophy and Policy, vol. 37, no. 1, pp. 118–37. Otteson, J., 2002. Adam Smith’s Marketplace of Life, Cambridge University Press, Cambridge. Raphael, D.D., 2007, The Impartial Spectator: Adam Smith’s Moral Philosophy, Oxford University Press, Oxford. Vivenza, G., 2001, Adam Smith and the Classics, Oxford University Press, Oxford. Wilson, E., 2015, “Self-Legislation and Self-Command in Kant’s Ethics”, Pacific Philosophical Quarterly, vol. 96, no. 2, pp. 256–78.

5 The joke is not funny anymore Irony, laughter and ridicule in Adam Smith1 Spyridon Tegos 1 Introduction Adam Smith is definitely not known for his contribution to the satirical tradition or his doctrine of laughter and ridicule. However, I argue in this chapter that his doctrine of laughter, wit and ridicule and his ironic style play a significant role in his philosophy of human nature in society; there is a growing number of recent studies regarding laughter, ridicule and satire in early modern moral and political thought. Smith emerges in various contexts but a systematic study of his contribution is lacking. Skirting Hobbesian reefs, his goal to reach propriety rests on the classical rhetorical tradition as his Lectures on Rhetoric and BellesLettres (LRBL) bear witness. In matching characters, style of expression and circumstances, Smith develops a theory of decorum in laughter and ridicule that will reform impolite manners, bourgeois and aristocratic alike, and reach social stability in a post-feudal commercial society with security and impartial administration of justice. To achieve this, he cultivates a subtly ironic, allusive style that ridicules indirectly and smoothly, drawing simultaneously on the tradition of classic French fiction and drama and the revival of Lucianic satire in early modern Britain. In this sense, his contribution in the history of civil mirth and civilized satire is significant. In this chapter, I first introduce the Hobbesian theory of laughter as a symptom of contempt toward any form of inferiority within the war of all against all and its roots in classical rhetorical tradition. Then I turn to Smith’s devastating critic of Shaftesbury’s pompous style while retaining his anti-Hobbes propensities. Smith distinguishes true wit from chaotic humor and defends the importance of the former for refined manners while condemning the latter as a sign of vulgarity. Thirdly, I review Smith’s transformation of the Aristotelian comedy of low characters to the ridiculing of commoners lack of status in modern comedies. For Smith, tragedies stage persons of noble origins within a feudal, socially segregated social order. In Section 4, I explore the extension of Smithian polite ridicule in The Theory of Moral Sentiments (TMS) to aristocrats and commoners that slavishly imitate them. Then I examine the Lucianic DOI: 10.4324/9781003301448-7

Irony, laughter and ridicule in Adam Smith  69 roots of Smith’s deconstruction of excessive self-admiration of great conquerors, statesmen and legislators alongside the inversed image of sunbathing beggars. In this respect, the status of cynical laughter in the commercial context looms large. Finally, I return to the staging of lovers and kings in tragedies, parallel that Smith develops in order to show the imperviousness and quasi-autism of kings and lovers regarding the sympathetic exchange between actors and spectators. Kings and lovers are equally indifferent to spectatorial sympathetic responses due to their social (kings) or emotional (lovers) autarchic status. Thus, they both distort the standard flow of sympathetic interaction. Therefore, Smith remains Lucianic in debunking social and political greatness. It has been persuasively argued that humor and laughter often have overlapping function in early modernity, “to express wonder or joy, to aid good health, to sustain attention, as well as to criticize, scorn and condemn” (Condren, 2012: 32). Smith criticizes Hobbes exactly over this tendency to systematically overshadow the nonaggressive layers in common life’s uses of humor. This does not mean that real failings should not be criticized and condemned. The non-reductive vision of human nature requires different rhetorical and narrative devices than the one mobilized by Hobbes. Indeed, during Smith’s time, irony and ridicule are often equated (Collins, 1729, quoted in Pitts, 2017: 162, note 33). On the other hand, Smith, while he rarely uses the term irony, he insists on the porousness of the boundaries between true ironical wit and rude, excessive irony, a matter of acute judgment and not rule following. 2 In this context, Smith draws on French fiction and theater to refine his multiple ironic devices. 3 During Smith’s time, irony’s standard understanding refers to Quintilian’s Institutio Oratoria within which the “contrary of what is said has to be understood” although the trope is less disguised (Quintilian, 2001, 9.45, quoted in Pitts: 162, note 36). In this chapter, I argue that Smith enriches this understanding with the French tradition of the persiflage trope enabling him to further nuance his ironic art of ridiculing while reinforce the Smithian obsession about the ridiculousness of love illusions and self-deceits. I use the terms irony and ironic with the contemporary sense of indirect and subtle form of undermining discourse drawing from the French tradition of persiflage to identify Smithian subtlety in deconstructing unrefined characters and uncivil mirth. The terms laughter and ridicule are used almost interchangeably in Smith. By contrast, Smith clearly distinguishes between wit and humor and I closely follow this conceptual distinction in order to differentiate polite from unrefined satire. The jokes are not always funny for Smith insofar as he goes beyond sharing a Hobbesian pessimism about the effectiveness of refining uncivil mirth; the attractiveness of self-indulgence regarding persons of high social visibility risks to explode the sympathetic community and corrupt moral sentiments.

70  Spyridon Tegos

2 The European context on laughter and ridicule in the shadow of Hobbes Aristotle’s Poetic and Rhetoric alongside Cicero De Oratore are the classical sources for any theory of satire and laughter in early modern Europe. Quintilian4 in book six of his seminal Institutio Oratoria discusses in equal measure Aristotle’s and Cicero’s accounts. Against this background, early modern theories of laughter and satire are well inserted into the philosophy of passions. Hobbes occupies a special place in this debate. It is a common place that he massively rejects Aristotelian philosophy with the partial exception of his Rhetoric and the theory of laughter (Skinner, 2004). In this context, laughter is associated not only with joy but also with rudeness (agroikos) (Aristote, 1926: IV.1128a.3–10). For Hobbes, it is clearly associated with contempt, domination and even cruelty. This is the backbone of the Hobbesian approach, as controversial as the rest of his doctrine. When we laugh, we are usually glorying or triumphing over others as a result of having come to see that, by comparison with ourselves they are suffering from some contemptible weakness or infirmity. This can go somehow into cruel mockery of the physically or mentally differently abled giving an outlook of a rather unsentimental 18th century (Dickie, 2011). This joy must be of a peculiar kind, since it appears to be connected in some way with feelings of scorn, contempt, and even hatred. Aristotle himself had insisted that the vices deserve to be reproved, and thus ridiculed, one of the most effective means of reproving vice (Skinner, 2004: 142). With the recovery of the classical theory of eloquence – one of the defining achievements of Renaissance culture – the classical theory of laughter was likewise revived, closely linked to a humoral moral psychology of sympathies and antipathies. One of the achievements of 17th-century physiology was to undermine the standing of humoral psychology, and with its rejection, the seemingly intimate connection between laughter and good humor was reduced to nothing more than a metaphor. Even Hobbes when he endorses a satirical vein, an important and unnoticed layer of his work (Condren, 2012), he takes as the targets of his ridicule, recognizably, the three vices that the Renaissance theorists had singled out: vainglory, avarice and hypocrisy. Laughter is gradually discredited as a moral category with the spread of courtesy books on polite behavior of the 17th and 18th centuries. Perhaps the chief source of their hostility can be traced to the demand for higher levels of decorum and self-control. An important aspect of this so-called ‘civilizing’ process in the sense of Norbert Elias (2000) is the progressive acculturation of aristocracy in Europe through the acceptance of bodily self-control and the development of feelings of shame and guilt. Elias’ essay on laughter judiciously recalls the importance of facial expressions and its cultural and social diversity as equally worthy of consideration as the expression of inner states.

Irony, laughter and ridicule in Adam Smith  71 Simultaneously avant-garde moral philosophers reclaim certain forms of ridicule compatible with civility. Shaftesbury’s philosophy of ridicule constitutes a major shift of focus and plays an exceptional and highly influential role in this movement; he rehabilitates the moral role of laughter and ridicule by introducing a major distinction between true and false ridicule especially regarding religious enthusiasm. Adam Smith is a direct heir of this gradual emergence of a pre-Victorian decorum culture although a slightly idiosyncratic one as we shall see below.

3 Adam Smith’s critique of Shaftesbury’s style: unrefined style and polite wit Shaftesbury’s famous treatment of wit, humor and ridicule skirts Hobbesian reefs and suggests an alternative path to understand ridicule and its potential importance for an early modern moral and a political philosophy. Its major battleground is religious enthusiasm and a chief contribution in the debate, through the notion of ridicule as “test of truth,” is the distinction between true and false ridicule (Shaftesbury, 1999a, 1999b). Shaftesbury rehabilitates and further extends the positive role of ridicule for polite conversation and the diffusion of civility in the process of collective reasoning, in order to dispel fanaticism and antisocial obsessions. Thus, he raises multiple issues regarding the freedom of wit (Anonymous, 2005: 3–7; Carroll, 2021), the status of ridicule and the Cynical and Stoic legacy concerning laughter5 that go beyond the scope of this chapter, which only focuses on Adam Smith’s reception of Shaftesbury’s doctrine. By and large, Smith endorses Shaftesbury’s but also Hutcheson’s, as we shall see in due course, attack on Hobbesian theory of laughter as a symptom of libido dominandi but he is more than critical over the style and the basic tenets of the third Earl’s doctrine of ridicule. Smith is less concerned by the disruptive force of ridicule regarding religious stability6 than his predecessors such as Shaftesbury or Hutcheson. Indeed, he pays no attention to this issue while he is adamant about the propriety that should frame any accepted kind of ridicule. In the lecture 11 of LRBL, he goes out of his way to deconstruct Shaftesbury’s style that he considers a total failure. From the outset, Smith emphasizes on the link between the character of the orator/author, circumstances and style of expression that should fit together in order to reach the desired level of propriety.7 The breach of decorum in the case of Shaftesbury, according to Smith is patent. Lacking any “particular temper” (LRBL, ii.152: 154) leads to a pompous and ornamental style disentangled from his time and circumstances. As a result, Shaftesbury aims at an ideal of perfection and replaces “what was deficient in matter” by the “ornament of language” (LRBL, i.145: 59). In Smith’s mind, Shaftesbury attempts to parallel Lucian, a crucial reference in

72  Spyridon Tegos Smith: both intend to “overthrow the present fabric of Theology and Philosophy but they differed in this: Lucian had no design of erecting another in its place” (LRBL, i.147: 60). While Earl’s assessment that this would be “easier accomplished and more to the taste of the times by ridicule than by confutation” (LRBL, i.147: 60) may be an overstatement on behalf of Smith, the implementation is clearly judged as merely disastrous.8 According to Smith the “Similes, and […] Metaphors” (LRBL, i.v.67: 30)9 and the overall style provoke no laugh to the point that Hobbes seems to win this comic contest and be more attractive and pleasant to the audience. Shaftesbury allegedly aims at “[p]olite dignity” and “as this seems to be best supported by a grand and pompous diction” (LRBL, i.146: 59), a stylistic choice made at the expense of “precision” and “propriety,” his prose prompts an overall sense of boredom. Yet the attack is far from over. By the end of the lecture, the punch line regards the substance of polite dignity, as the “nobleman” is accused of rudeness and false wit: This Nobleman sometimes allows himself even to run into Burlesque, his Pompous Stile and humorous thoughts joined together make it almost unavoidable. But this species of Ridicule is always buffoonish and he surely falls greatly off from the Polite dignity he studies to maintain, when he allows himself a species of wit that is greatly beneath the character of a gentleman. (LRBL, i.148: 60–1) It is noteworthy that throughout the 17th century in France, important men of letters such as Guez de Balzac, Bouhours or Méré reclaim Lucian’s legacy within the debate about the eloquence, the style and characters proper to the ideal honnêteté (Bury, 2007). In this context, the new translation and edition of Lucian’s oeuvres by Nicolas Perrot d’Ablancourt, controversial insofar as it will be remembered as the belle infidèle, sheds new light on the sense of the required urbanity within polite literature (Bury, 2007: 157). In the ultimate edition, d’Ablancourt asserts that the taste (goût) of Lucian, alongside “une humeur gai et enjoué,” blends neatness and purity in style and perfectly combines the ancient urbanitas with modern elegance and politeness (d’Ablancourt, 1972: 162; Bury, 2007: 157). Yet there is an interesting precedent in Lucian’s reception in France as an ancient precursor of the “bel esprit.” Balzac, an extremely influential and fine connoisseur of Lucian, seems to be convinced that Lucian’s oeuvre, for all its worth, needed serious amendments regarding the fine line between raillery and polite humor, farce and comedy as he puts it (Guez de Balzac, 1972: 498; Bury, 2007: 163). According to Balzac, Lucian’s original text blurs those lines and needs to be polished. Thus he thinks Seneca is the model of “gaieté d’esprit” a medium between sadness (tristesse) and buffoonery (buffonnerie) (Bury, 2007: 205; Guez de

Irony, laughter and ridicule in Adam Smith  73 Balzac, 2018: 205). Phrases such as “l’amour des garçons” (the love of young boys) for instance, will be systematically removed from d’Ablancourt’s translation (Bury, 2007: 163). It is striking that Smith’s critique of Shaftesbury’s position on laughter and ridicule straightforwardly replicates the abovementioned French controversy. Furthermore, Smith makes the case of Lucian, as we shall see below, as one of the models of the right use of ridicule with an impact on moral behavior. Yet this Lucian seems already polished enough to fit “Polite dignity” (LRBL, i.148: 60). The sort of Lucian’s ridicule though, the issue of ridiculing great persons, Gods, philosophers and great statesman and overall being iconoclastic remain more complex for Smith than it appears at the first glance. In his Review of Johnson’s Dictionary, Smith pauses at length on the entry on humor. In this account, it is made clear the transition from the humoral psychology that is no longer considered as scientific to the metaphoric sense; Smith is cautious to distinguish humor from wit and good humor from good nature. Humor is inconsistent with “true politeness” and although a buffoon is more diverting than a gentleman, the buffoon remains morally unworthy (Review, 13: 241). Smith parallels Balzac’s concerns regarding the uncontrollable and potentially morally and socially disruptive status of humor that is constantly on the edge of veering off course in undermining “true politeness:” Wit expresses something that is more designed, concerted, regular, and artificial; humour, something that is more wild, loose, extravagant, and fantastical; something which comes upon a man by fits, which he can neither command nor restrain, and which is not perfectly consistant with true politeness. (Review, 13: 241) It has been accurately remarked (Carroll, 2021: 120–1) that Smith, following Shaftesbury and even closer, as we shall see below, Hutcheson, aims at deconstructing the Hobbesian agenda on laughter and ridicule. Yet he concedes some points to the opponent as he did while acknowledging that Hobbes provokes more laughter than Shaftesbury. In TMS, while he argues that humanity sympathizes with small joys and great afflictions, he clearly accepts that great joys provoke more jealousy than sympathy while “[s]mall vexations” (TMS, I.ii.5.3: 42) prompt laughter more than compassion. On this occasion, he explicitly refers to the endemic “malice in mankind” regarding small misfortunes even among men of “good breeding:” There is, besides, a malice in mankind, which not only prevents all sympathy with little uneasinesses, but renders them in some measure diverting. (TMS, I.ii.5.3: 42)

74  Spyridon Tegos Smith argues that the common experience of the world is enough to understand how ridiculous the “frivolous calamities” (TMS, I.ii.5.3: 43) appear to others and therefore ordinary men prevent themselves from expressing string sentiments upon such occasions or yearning for sympathy from their fellows (TMS, I.ii.5.4: 43). It remains to set the issue of implicit or ambiguous cases of ridicule in TMS. Prior to this, we turn to Smith’s explicit treatment of the issue in LRBL insofar as in TMS Smith does not provide such a doctrinal analysis. The ridicule does not seem to be an indifferent topic for Adam Smith. In this respect, he dedicates two of his LRBL (nine and ten) in which we read that while we admire the grand and beautiful and show contempt to what is mean and little: 1st When mean objects are exposed by considering them as Grand, or 2dly when Grand ones or such as pretend or are expected to be so, are ridiculed by exposing the meaness and the littleness which is found in them. Swift has chosen the former and Lucian the latter of these Sorts. (LRBL, i.117: 48) In what it follows, Adam Smith examines the style of expression of sentiments as it matches the respective character of each author, one ancient and one modern before concluding that both together form a System of morality from whence more sound and just rules of life for all the various characters of men may be drawn than from most set systems of Morality. (LRBL, i.125: 51) Smith is known for being sometimes highly idiosyncratic or excessive in his statements. Following Ryan Hanley’s insight (2008), I am inclined to think that this bold statement contains more meat than a simple rhetoric crescendo of a kind. It touches on Smith’s moral project and his social theory. In the abovementioned section of LBRL, Smith states: Swift as we said exposes none but Empty Coxcombs, Fine Gentlemen, Beaus, Belles, and any that encouraged themselves in employments of no moment or importance of life. [...] Lucian on the other hand has pitched on, for the subject of his ridicule, persons of the most solemn and respectable characters, as Gods, Goddesses, Heroes, Senators, Generalls, Historians, Poets, and Philosophers, as those wherein the Graver sort of follies are most commonly found. (LRBL, i.122–123: 50) The Smith–Swift connection has already been studied to some extent. Instead I wish to shift the attention on the Lucian’s legacy, extremely active in early modern Britain (Robinson, 1979: 65–163, 198–237), in

Irony, laughter and ridicule in Adam Smith  75 Smith. It has to be reminded that throughout the 18th century, Lucian has been the object of translations and reinterpretations, with the case of Fielding as particularly prominent, more or less controversial, revolving around the ethics of religious ridicule and the deistic or atheistic connotations attached to the Greek satirist (McDowell, 2019: 158–60). In brief, the historical context of the abovementioned debate revolves around the distinction between the “true wit and humour,” appropriate to the “reformation of manners” (LRBL, i.v.116: 47), and the anarchic, centrifugal force of scoffing and jest, proper to the Hobbesian latent strife for superiority. This seems to be at the heart of Smith’s case against Hobbes, less the competitive background and the contempt underlying any seemingly peaceful laughter. It is not always a matter of latent desire for domination. The contrast of a tall man among little men or of any trivial accident during a solemn speech or a funeral show, according to Smith, that incongruity can be a prominent cause of laughter and ridicule (LRBL, i.112–113: 45). Overall, the crux of the matter is the potential excess involved in the process of ridiculing, the abovementioned “wild, loose, extravagant” power that risks to get out of control because, once unleashed, no one can block it or safely frame it. Hobbes is partly right in pointing to the uncontrolled rudeness over which nobody can strategically take advantage of as it remains always a double-edged weapon and often bounces back. Oddly enough, Smith criticizes Hobbes for not being realist enough to include incongruity or self-deceit on the part of the insulter in his criteria but he seems to acknowledge that objections against Hobbesian doctrine that rest on explicit rules and limits on the process of ridiculing are doomed to fail. Instead, he is looking for a proper style of expressing ridicule. The task to frame an unbridled matter is daunting.

4 Aristotelian comedy and class contempt: the ridicule of vulgarity In the aftermath of Shaftesbury’s legacy, Hutcheson, in Hibernicus’s Letters, tackles the issue of laughter defending Shaftesbury against Hobbes with some original contributions on his behalf (Hutcheson, 1734: 77–107). Hutcheson argues that alongside other senses, including the moral sense, we are implanted from providence with a sense of ridicule.10 Hutcheson conceives the sensus ridiculis stemming from a combination of the high and the low (Hutcheson, 2006, quoted in Carroll, 2021: 81–2), and suggests three main functions of laughter, totally dissociated from any Hobbesian desire for superiority or contempt. Laughter calms anxiety, sorrow and misery that overshadow human life providing a valuable sense of release. Secondly, it is contagious and helps enhancing emotional bonds such as friendship and conviviality (Hutcheson, 1734: 96–7; Carroll, 2021: 81–2). Finally, the ridicule can serve as a

76  Spyridon Tegos weapon against intellectual obsessions and religious fanaticism, in other words, very much in a Shaftesburian vein, as an antidote to the crank. In his essay on laughter, Elias perceptively notes that Hutcheson, reflecting more than Hobbes on an emerging middle class with less political power, aims at deflating false grandeur and in moralistic vein, promoting efficient social control of self-aggrandizement instead of cynically accepting the war of inflated egos as unsurpassable.11 Yet Hutcheson distrusts Shaftesbury’s optimism about countering uncivil mirth. Civil magistrate’s intervention and mutual polishing are not enough to prevent the act of ridiculing from veer off course. In this respect, he adds a set of recommendations to spare the ridiculed from (unfair?) humiliation. Overall ridicule is a dangerous weapon and has to be handled with care, especially regarding the capacity of unrefined persons to restrain themselves on this front. Using ridicule to correct unsocial behavior in cases of mixed characters that combine great and ridiculous traits requires an acknowledgment of the respectful part that needs to stand out and be separate from the ridiculous aspects. In this respect, Hutcheson implements a strategy of compensation (Carroll, 2021: 83); the act of ridiculing simultaneously needs to demonstrate an aversion to humiliation and to prove that no pun was intended. It is perspicuously remarked that this is an odd set of recommendations, an indirect concession to the Hobbesian side. Certain contemporaries did not miss the opportunity to express their skepticism or even scoffing of the practical value of such recommendations to contain abuses of ridicule (Carroll, 2021: 83). In his account of tragedy and comedy in the LRBL, Smith seemingly follows the broad lines of the Aristotelian taxonomy. As Gloria Vivenza shrewdly remarks (2001: 166), there is a significant change though. According to Aristotle, in comedies, the characters or temperaments are what chiefly interests the spectator while in tragedies and epic poetry, the “adventure or circumstances” and the behavior of the protagonists in them is the main feature. Smith replaces character with social status that apparently reflects temperaments. This change takes place in an almost Hobbesian atmosphere of social and psychological segregation: There is in humane Nature a Servility which inclines us to adore our Superiors and an inhumanity which disposes us to contempt and trample under foot our inferiors. […] we are apt to pay great respect and attention to our superiors however unworthy are what chiefly affect us. Nay such is the temper of men, that we are rather disposed to laugh at the misfortunes of our inferiors than take part in them. (LRBL, ii.90: 124) Smith twists the knife even deeper regarding the “prejudice,” the tolerable humiliation within a stratified society toward the socially “equall or inferior” (LRBL, ii.91: 124). It is noteworthy that Smith constantly

Irony, laughter and ridicule in Adam Smith  77 refers to “equalls” or “inferiors,” a phrase that recurs throughout his analysis of Comedy and Tragedy echoing a Hobbesian strife for superiority with the exception of aristocrats that compete only among them. Only commoners can be the protagonists of comedies because only they can be ridiculous. Nobles can hardly be ridiculed; they are so much above ordinary vices; on the contrary, “there is something respectable even in their follies” (LRBL, ii.91: 124); they are the sole heroes of tragedies that exclude non-aristocrats: We can laugh heartily at the absurdity of a shoemaker or a burgess tho we can hardly prevail on ourselves to weep at his misfortunes. Farces where the characters are the lowest of any make us laugh more than the finest comedy, and on the other hand we can hardly enter into the humour of a comedy of the higher sort where dukes and nobles are the objects of our laughter. (LRBL, ii.91: 124) His account conflates characters with ranks and depicts a hierarchic social order within which sympathy with the misfortunes of nobles and contempt for the troubles of socially “equalls” or “inferiors” are the symptoms of a collective psychology with its own aesthetics.

5 Laughing at aristocrats in The Theory of Moral Sentiments: the Lucianic extension of Smithian ridicule and irony In TMS, this class segregation amid crude stratification is somehow qualified. In this context, I wish to examine the influence of Lucian on certain understudied aspects of irony and proper ridiculing in Smith. Through the Lucianic lens, one can revisit Smith’s anti-Hobbesian stance within his theory of laughter and ridicule. Smith shares with Hobbes the Lucianic spirit of laughing at self-delusion and manipulative self-interest of the wise but he focuses on a dimension of Lucianic satire overlooked by Hobbes and the Scriblerians: instead of ridiculing intellectual servility, religious or philosophical sophistry and superstition (Condren, 2012: 34–44), he ridicules the rich and the great and even goes beyond, demystifying royalty while acknowledging the utility of royal authority for stability and peace. Noble birth is laughed at and the tone is clearly Lucianic. Smith directly echoes in style and content the famous saying of Pascal: Good birth is a great advantage, for it gives a man a chance at the age of eighteen, making him known and respected as an ordinary man is on his merits at fifty. Here are thirty years gained at a stroke. (1901: 69)

78  Spyridon Tegos In the same vein, Smith states: A stranger to human nature, who saw the indifference of men about the misery of their inferiors, and the regret and indignation which they feel for the misfortunes and sufferings of those above them, would be apt to imagine, that pain must be more agonizing, and the convulsions of death more terrible to persons of higher rank, than to those of meaner stations. (TMS, I.iii.2.2: 52) In this context, the appeal to eastern adulation is crucial. The “bulk of mankind” (TMS, III.5.1: 162) defers to the wealthy and the great, almost idolizing them, after “the manner of eastern adulation” (TMS, I.iii.2.2: 52). In the chapter “Of the origin of Ambition, and of the distinction of Ranks” (TMS, I.iii.2) and the next “Of the corruption of moral sentiments” due to the admiration of the rich and powerful, Smith deconstructs this “public admiration” (TMS, I.iii.2.4: 53) based on what he calls a “prejudic[e] of imagination” (TMS, I.iii.2.2: 52). The tone is still descriptive but the style is clearly ironic and the humor is half-Swiftian, half-Lucianic. The only merit or virtue that kings and aristocrats have is to show propriety to “small duties” (TMS, I.iii.2.4: 53) of ordinary behavior, to “figure at a ball,” to succeed in “an intrigue of gallantry” (TMS, I.iii.2.5: 55) are their achievements. Throughout this chapter, Smith exposes the ridicule of princes and aristocrats, their shallowness matched only by the servile imitation of their socially inferiors, no less ridicule… This ‘human comedy’ avant la lettre is a study on impropriety through an anatomy of social authority’s ridicule. However, it operates only if based on the “prejudices of the imagination” (TMS, I.iii.2.2: 52). This ridicule is more appropriate to Swift’s mocking satire and parody. Throughout TMS, I.iii.2–3, Smith insists on the sympathetic attention that kings and aristocrats attract without merit: they inherit status, but they do not deserve the sympathetic attention they gain. Indeed, entering a ball is their high achievement. Men of noble origins are indifferent about what other people think of them because they are conscious that they are and will remain the center of attention whatsoever. The tone becomes clearly Lucianic when Smith introduces the notion of “peculiar sympathy” (TMS, I.iii.2.2: 52). In Smith’s vernacular, peculiar sympathy concerns basically royalty, the fact that kings are worshipped because they massively attract public attention without any effort. In TMS, I.iii.2, Smith expresses bourgeois resentment toward the titled aristocracy and its lack of merit while warning the meritorious ‘middling rank’ to avoid mimicking aristocratic manners.12 The upstarts (coxcombs) equally receive their fair share of ridiculing, “a double share of contempt” (TMS, I.iii.2.5: 55) for mimicking aristocratic manners. In TMS, IV, Smith lucidly notes rich people are envied because they obtain

Irony, laughter and ridicule in Adam Smith  79 more means for happiness not because they are actually happier. The poor man’s son’s tale is different; the poor man’s son aims to be wealthy; and struggles to move up in the social ladder while one is born king or high aristocrat. It is all about the moral psychology of social mobility in a post-feudal society that still lives within huge feudal institutional and psychological remnants. Putting TMS I and IV on the same footing without paying attention to nuances can prove to be a perilous exercise and lead to inaccurate judgments.

6 Alexander the Great and the sunbathing beggar: cynical laughter and Lucianic ridicule In TMS, VI, Smith seemingly resumes his cynical, socially stratifying approach of LRBL regarding class servility. Once examined, the ordinary standard of excellence proper to the prudent man, Smith reviews the case of great men, conquerors, generals, statesmen and legislators. Smith thinks that even ordinary people show a certain degree of selfdelusion and foolishness: We frequently, not only pardon, but thoroughly enter into and sympathize with the excessive self-estimation of those splendid characters in which we observe a great and distinguished superiority above the common level of mankind. (TMS, VI.iii.33: 255) Tamerlane and Genghis Khan, both famously bloodthirsty, are equally worshipped (TMS, VI.iii.30: 253). This disorder of our moral sentiments, Smith argues, enhances political submissiveness and smooth unruly propensities. The key psychological feature of those persons that attracts the sympathy of mankind and the “foolish acclamation” (TMS, I.iii.3.8: 65) of the masses is, according to Smith, excessive self-admiration. The “splendid characters” that performed the “most illustrious actions, […] [w]hen crowned with success, accordingly, this presumption has often betrayed them into a vanity that approached almost to insanity and folly” (TMS, VI.iii.28: 250). Smith acknowledges the real merit of those “spirited, magnanimous, and high-minded person” (TMS, VI.iii.30: 252). Yet he scrutinizes the status of this excessive self-admiration. Alexander the Great, Caesar and even Socrates took themselves for Gods or for having a privileged contact with deity. The wise men detect the ridicule of this excessive self-admiration. Flatterers and foolish admirers stick upon great men and reinforce their loss of grip from reality. The great men are first and foremost the enthusiastic admirers of themselves. They do believe in their mythical dimension. The excessive self-estimation cripples any capacity

80  Spyridon Tegos of facing misfortune. In fact, great men are depicted as highly insecure and unsteady as they need constant confirmation of their superiority surrounded by unreliable, self-serving courtiers. Alexander the Great is the object of lengthy analysis as he colonizes the imaginary of mankind. Yet his insanity, his early self-perception as a Godlike figure, makes him ridiculous like any ordinary vain person. Finally, there is a tragic side as he ends his life in misery, self-deception and chaotic destructiveness of the most important persons in his family and personal life. One should bear in mind that this is exactly the target of Lucianic satire. In his Dialogi Mortuorum (Lucian, 1961), famously reported by Smith as the deathbed reading of Hume,13 Lucian presents Diogenes as a laughing Cynic with the limits and borders of his ridicule being the subject of intense debates from his time onward. Be this as it may, the portrait of the laughing Cynic, Diogenes or Menippus, regular protagonists in Lucian’s satire, moves center stage. In Dialogi Mortuorum, any ground of obsessive attachment in goods such as beauty, riches, fame and intellectual achievements are considered as ridiculous forms of deceit (Kuin, 2019: 752). To this, the figure of beggar adds another ground of worldly obsession, the fear of death. In Smith’s TMS, we despise beggars because we cannot sympathize with their total misery unless we acknowledge their fall from riches to poverty (TMS, III.3.18: 144). However, the famous sunbathing beggar in TMS, IV, possibly an allusion to the ancient encounter of Alexander the Great with Diogenes the Cynic (Martin, 2015) echoes some of Lucian’s satire; the context is the love of the system, be intellectual, economic, social or political, including the accumulation of wealth by a poor man’s son, which always has an aesthetic ground, dissociated from actual happiness or pleasure: “The same principle, the same love of system, the same regard to the beauty of order, of art and contrivance […]” (TMS IV.i.11: 185). This idiosyncratic Smithian context gives the Lucianic cynical laughter a strange twist: In ease of body and peace of mind, all the different ranks of life are nearly upon a level, and the beggar, who suns himself by the side of the highway, possesses that security which kings are fighting for. (TMS IV.i.10: 185) All of a sudden, beggars exit their sympathetic invisibility and incarnate a form of Rousseau-like ideal of mental peace and psychological balance in the state of nature that Smith does not think can really exist outside the security provided by the commercial society and the “administration of justice” (TMS, VI.i.16: 217). This is the reason why he underlines the “security” that kings are fighting for. Yet he is ironic in his own right following his Lucianic model of the laughing Cynic adjusted to the Smithian polite rhetoric of moral sentiments. Smith vindicates an allusive, ironic

Irony, laughter and ridicule in Adam Smith  81 style that is sufficiently implicit and indirect, therefore, fits the Smithian standards of polite propriety and nurture sociability. Very little is indirect in Lucian therefore Smith complements the Lucianic dimension with the French fiction and particularly some of its tropes.

7 Is love ridiculous in Adam Smith? “Persiflage” in French fiction and the “autism” of lovers and kings At this juncture, the fine Smithian ironic ridicule needs to be contextualized within French fiction. It has been rightly argued that Smith’s reference to Crébillon the younger, Mme Riccoboni and Marivaux answered the reductive view of human nature in which all human action is necessarily determined by the single principle of amourpropre by emphasizing the countervailing process of sympathetic love. (Leddy, 2008: 234) In LRBL, Smith accounts for the fine-tuned moral psychology of characters encountered in those French authors. The agenda fits his socioeconomic explanation of certain mental phenomena. Urban imperial centers, in Ancient Rome as in his contemporary monarchical France, in Paris, with their luxury and refined manners enable such authors to focus on the subtlest layers of the mental world, the “internall affections” (LRBL, ii.64: 112) and the finest motives of human characters.14 For instance, the case of Crébillon the younger, almost in total oblivion today, presents a special interest. Why does Smith find him so interesting? His abovementioned emphasis on the sympathetic love and his multilayered view of human affections, especially love, are obviously one reason. Is there any more to say about Smith’s admiration here? I think it is related to the topic of the rhetoric of proper ridiculing and appropriate wit. This originates in the French art of persiflage, extremely important in French society, art and letters of the Old regime and totally lost after the French revolution. In Democracy in America, Tocqueville interestingly notices that while an aristocratic class is losing ground and slowly vanishes, it leaves some traces in history but the “light and delicate forms of its mores” often disappear without leaving any trace (Tocqueville, 2010: 1077). The notion of persiflage, basically untranslatable, can have a sense of an irony that passes unperceived because it is too fine or the person parodied does not master the code, as a humiliation that its victim cannot recognize or as an art of ridiculing and humiliating implicitly and subtly making someone expose himself to ridicule unwittingly, which is a badinage of ideas and expressions, the real meaning of which leave the audience skeptical about. Finally, talking seriously about frivolous matters or making fun of serious matters are standard forms of persiflage (Bourguinat, 2016: 20). Persiflage always

82  Spyridon Tegos occurs without explicit insult or physical violence. The violence is verbal or psychological and hard to deal with successfully unless one is part of the Parisian salon world where the petits maîtres and roués, the aristocrats in between the court and city salons, dominate. Crébillon and Marivaux, authors whose work Smith considers as chief cases of stylistic excellence and subtle psychology are also registered as masters in “neologism” (Marivaux) and the art of persiflage (Crébillon fils) (Bourguinat, 2016: 15). In one of his successful books, Les égarements du cœur et de l’esprit ou mémoires de Mr Meilcour (Crébillon, 1985), the notion of ridicule moves center stage as co-substantial of any social status and character in order to gain attention in le monde. Successfully handling the appropriate way of ridiculing is required to gain social recognition (Crébillon, 1985: 209–11; Bourguinat, 2016: 77–8). Crébillon demonstrates the disconcerting, illusory (Sgard, 1996) nature of amour libertin that exposes the oneiric, chaotic, self-deceitful and destructive while socially cruel status of libertine love (Sgard, 2002). This subtle analysis that can be read as a deconstruction of romantic love and an attempt to associate “internall affections” (LRBL, ii.64: 112) and moral sentiments with libertine love requires parody of the tragic pomp, oxymoron, amphigory, hyperbole, ambiguity and other rhetoric and narrative devices (Bourguinat, 2016: 77–8, 88–9) eventually attracted Smith’s attention. Yet it needs to be adjusted and translated into Smith’s inclusive and decorum-driven doctrine of sympathy. As seen above, the staging of love as of every other human emotion requires a specific rhetoric, an indirect, implicit manner of speaking or demonstrating the intensity and the singularity of emotional outbursts. Crébillon’s fine analysis of libertine love’s illusions can serve such an endeavor. The category of ridicule emerges in the TMS from the outset. The distinction between passions taking their origin in the body and “those Passions which take their origin from a particular turn or habit of the Imagination” (TMS, I.ii.2: 31) leads to an idiosyncratic Smithian treatment of love. While a growing number of scholars (Nussbaum, 1990; Griswold & Den Uyl, 1996; Hanley, 2017) scrutinize the peculiar treatment of love in the TMS, very few shift their attention to Smith’s repetition of the term ridiculous. In the TMS, romantic love is “always laughed at” (TMS, I.ii.2.1: 31). To a certain extent, Swift’s abovementioned grave ridiculing of pretentious littleness seems to fully apply here. It is correctly pointed out that Adam Smith condemns love for being exclusive and rejecting any alternative sociability. To be sure, the trope of ridicule can be viewed as a rhetoric enforcement of an important lack in a lover’s character that is indifference to spectators let alone the impartial spectator. In this vein, Smith uses the term ridiculous as a marker for the impermeability, the quasi-autism of lovers who live in their own exclusive world, indifferent to the sympathy of others, self-absorbed free riders in the social sympathetic exchange. However, the situation is more

Irony, laughter and ridicule in Adam Smith  83 complicated than it may appear at first glance. Although psychologically insulated, ultimately lovers do attract an enormous amount of spectatorial sympathy. Insofar carefully represented, the myopic world of lovers exerts a form of attraction. Once on stage or on page, the condition of lovers is considered as a state of “pastoral tranquility,” the “Fortunate Islands,” in other terms, a state of an Aristotelian autarchic happiness, “free from labor and from care” (TMS, I.ii.2.2: 32). In this context, improper and ridiculous become almost interchangeable. In the previous chapter of TMS (I.ii.1), some Greek tragedies are criticized in their attempt to excite compassion by representing bodily pain. At this juncture, Smith’s sarcasm is at its best: What a tragedy would that be of which the distress consisted in a colic! Yet no pain is more exquisite. (TMS, I.ii.1.11: 30) The loss of a leg may generally be regarded as a more real calamity than the loss of a mistress. It would be a ridiculous tragedy, however […]. (TMS, I.ii.1.7: 29) By the same token, a scene of “perfect security” and imperturbable bliss “would excite laughter, and not sympathy” (TMS, I.ii.2.3: 33). The spectator sympathizes lover’s anticipation of any passion that unsettles this ‘perfect happiness’ such as “anxiety,” “concern,” and “distress” (TMS, I.ii.2.2: 32). Only the Lockean uneasiness of lovers attracts a spectator’s attention. According to Smith, sexual love is always improperly represented: the “grossness of that passion” is ridiculous if imagined or represented while the disappointment of “such natural and agreeable hopes” (TMS, I.ii.2.2: 32) of enjoying such a passion has nothing ridiculous because the spectator sympathizes with the agony of lovers. Throughout the European history of belles-lettres, famous love stories have captivated audience’s moral imagination. Smith implies that we sympathize with lovers in their intimate conviction that perfect autarchic happiness is within reach for humans and therefore with their agonies of an eventual deception of such a perfect life. In Smith’s narrative, ordinary spectators of love stories in theater share the hope for autarchic happiness but never the happiness itself, far too “bodily.” In the process of sublimation, they never experience any form of sympathetic satisfaction; they only share the preceding uneasiness. The ridicule of lovers matches the permanent uneasiness of spectators. While Smith’s doctrine can be retrospectively, and fruitfully, interpreted through a psychoanalytic lens regarding sublimation or as a symptom of puritanism, I would rather shift the focus to Smith’s analysis of sympathy with kings. In a stunning passage, Smith draws a parallel

84  Spyridon Tegos between the ‘states of happiness’ of kings and lovers. Although there is no rational or empirical foundation, “prejudices of the imagination” that go beyond imagination’s proper functioning lead ordinary spectators to hugely overstate the happiness of kings and lovers: It is the misfortunes of Kings only which afford the proper subject for tragedy. They resemble, in this respect, the misfortunes of lovers. Those two situations are the chief which interest us upon the theatre; because, in spite of all that reason and experience can tell us to the contrary, the prejudices of the imagination attach to these two states a happiness superior to any other. (TMS, I.iii.2.2: 52, italics added) Smith scrutinizes the parallel process of identification with kings and lovers. In this sense, Smith describes a process similar to spectator’s identification with a hero in a novel or a drama. Thus, he shows that in both cases, there is a model of autarchic happiness that drives ordinary spectator’s attempt to avert any real or imaginary cause of distraction. In both cases though, actors do not participate in the sympathetic process; they are either immune or indifferent to it, as with lovers, or they gain massive sympathy without any effort or virtue (kings). Therefore the “prejudices of imagination” undermine the proper function of the impartial spectator. In a nutshell, Smith focuses on the free rider problem within the sympathetic process. Lovers and kings trigger a sympathetic identification within which the spectator approves the actor because the actor attracts sympathy at no psychic cost, without any merit. The spectator admires the emotional (lovers) or social status (kings) of the actor and their massive social visibility regardless of their moral status. Thus, the spectator yields to a sympathetic attention at no moral cost. This dysfunction of the necessary awareness of both the actor and the spectator regarding the virtues required in the sympathetic process brings to the fore an overlooked dimension in the Smithian claim about moral corruption: the “bulk of mankind” feels an unbounded admiration for the gratuitous sympathy gained by kings and lovers that threatens the moral community. Smith attempts to show how common albeit ridiculous such a dream is. The autarchic happiness of lovers and kings is merely autistic with this difference that the latter’s worship by the bulk of mankind has some utility; it enhances social order and makes citizens more obedient. This is not the ultimate Smithian irony.

8 Conclusion Civilized behavior became a model of behavior for the emerging strata of middle-class commoners and took the form of a call for mutual respect and self-censure. The imperative of decorum was no doubt the principal

Irony, laughter and ridicule in Adam Smith  85 source of the growing movement in the early modern period to discredit laughter within civilized society. In this context, satire and especially the category of ridicule were not meant to disappear; in so far as we turn to the core of the Enlightenment era, they are gradually transformed to fit the alleged standards of polite and proper behavior. Within this process, Adam Smith moves center stage developing in different places of his oeuvre a subtle and systematic reflection over laughter, humor, wit and ridicule as tools of moral and social reform that have to be handled with care due to their potential of aggressiveness, psychological turmoil and social unrest. With the shadow of Hobbes looming large, Smith criticizes Shaftesbury’s allegedly unbalanced style and moves beyond Hutcheson’s moralistic rhetoric in order to promote an agenda of novel, polite ironic style of expression that averts uncivilized behavior without naïve or religious-like idealizations. In this respect, in WN, Smith famously asserts that the “childish vanity” of the feudal overlords on the one hand and the merchant and artificers with “their own peddler principle of turning a penny wherever a penny was to be got” on the other (WN, III.iv.17: 422) are the agents who gradually brought about commercial prosperity and liberty within medieval chaos. At this juncture, Smith seems to side with Hume while making a step further; the history of civilized European nations and their moral (un-)awareness of distant others (Pitts, 2017) leads to singularly unheroic historical narratives without genuine idols to be worshipped and lionized. The straightforward demystification of founding fathers and foundational myths call for a powerful rhetoric and stylistic tool, the category of ridicule as a deconstructionist causal force in the historical narrative. Therefore, his contribution to the history of European civility is major.

Notes 1 This paper has greatly benefited from Ross Carroll’s perspicacious comments. The usual caveat applies. 2 Only judgment, not rules, can tell “[h]ow far an agreeable irony may be carried, and at what precise point it begins to degenerate into a detestable lie” (TMS, VII.iv.33: 339). 3 “Although Smith uses the term irony itself only once in his collected writings, I argue that he deployed a variety of ironic devices and that his own analysis and endorsement of the rhetoric of ridicule helps us to understand the critical work these devices enabled him to perform” (Pitts, 2017: 151). 4 Smith owned Institutio Oratoria and quotes it upon several occasions in the LRBL. 5 Regarding the early modern reception of Ancient philosophy in Shaftesbury, Carroll, 2021: 21–51. 6 For the well-grounded of satire about religious matters and the major controversial topics within this debate, see Anonymous, 2005. 7 For useful context, Hanley, 2008. 8 For a critique of Smith’s refutation, see Carroll, 2021: 59–60.

86  Spyridon Tegos 9 So the text in its entirety: “What has been said of the justness or propriety of metaphors is equally applicable to other figures, as Metonymies, Similes, and Allegories, Hyperbolls. Metaphors are nearly allied to Metonymies as we observed before” (LRBL, I.v.67: 30). 10 Smith explicitly states the Hutchesonian sense of ridicule in his account of Hutcheson philosophy (TMS, VII.iii.3.7: 322). 11 Elias, 2017: 294: Hutcheson saw in laughter a reaction to the contrast between dignity and meanness. There is nothing like it, he thought, for deflating false grandeur and bringing our imagination or the violence of our passion to a conformity with the real importance of our affairs. 12 On Swift’s satire of coxcombs and upstarts that parallels Smith’s, Hanley, 2008: 95–7. 13 For context and excellent discussion, see Schliesser, 2017: 334, 358–61. 14  They who live thus in a great City where they have the free Liberty of disposing of their wealth in all the Luxuries and Refinement of Life; who are not called to any publick employment but what they inclined to and obtained from the favour and Indulgence of the prince; Such a people, I say, having nothing to engage them in the hurry of life would naturally turn their attention to the motions of the human mind, and those events that were accounted for by the different internall affections that influenced the persons concerned, would be what most suited their taste. The French monarchy is in much the same condition as the Romans under Trajan and we find accordingly that those writers who have studied to be most agreable have made great use of Sentiment. This is that in which the works of Marivaux and the younger do excell. Marivaux and Crebillon resemble Tacitus as much as we can well imagine in works of so conterary a nature. (LRBL, ii.63–64: 112)

References Anonymous, 2005, An Essay on Ridicule [1753], Elibron Classics, Adamant Media Co., MA. Aristotle, 1926, Nicomachean Ethics, ed. H. Rackham, Harvard University Press (“Loeb Classical Library”), Cambridge, MA. Bourguinat, É., 2016, Persifler au siècle des Lumières. Histoire du mot “persiflage” 1734–1789, Créaphis éditions, Paris. Bury, E., 2007, “Un sophiste impérial à l’Académie: Lucien en France au XVIIe siècle”, in C. Ligota & L. Panizza (eds.), Lucian of Samosata vivus et redivivus, The Warburg Institute, London – Turin, pp. 152–66. Carroll, R., 2021, Uncivil Mirth. Ridicule in Enlightenment Britain, Princeton University Press, Princeton, NJ. Collins, A., 1729, A Discourse Concerning Ridicule and Irony in Writing, Brotherton, London. Condren, C., 2012, Hobbes, the Scriblerians and the History of Philosophy, Pickering & Chatto, London. Crébillon, C.-P. Jolyot de, 1985, Les égarements du cœur et de l’esprit, ou Mémoires de Mr Meilcour [1736–1738], ed. J. Dagen, Garnier Flammarion, Paris.

Irony, laughter and ridicule in Adam Smith  87 d’Ablancourt, N.P., 1972, Lettres et préfaces critiques [1628–1654], ed. R. Zuber, Didier, Paris. Dickie, S., 2011, Cruelty and Laughter. Forgotten Comic Literature and the Unsentimental Eighteenth-Century, University of Chicago Press, Chicago, IL. Elias, N., 2000, The Civilizing Process. Sociogenetic and Psychogenetic Investigations [1939], ed. E. Jephcott (rev. E. Dunning, J. Goudsblom & S. Mennell), Blackwell, Oxford. ———, 2017, “Essay of Laughter”, ed. A. Parvulescu, Critical Inquiry, vol. 43, no. 2, pp. 281–304. Griswold, C. & D. Den Uyl, 1996, “Adam Smith on Love and Friendship”, The Review of Metaphysics, vol. 49, no. 3, pp. 603–37. Guez de Balzac, J.-L., 1972, “Du Style Burlesque”, in J.-L. Guez de Balzac, Les Entretiens [1657], ed. B. Beugnot, Dider, Paris, pp. 123–38. ———, 2018, Œuvres (Socrate Chrestien; Aristippe; Entretiens), Forgotten Books, London, vol. 2. Hanley, R.P., 2008, “Style and Sentiment. Smith and Swift”, The Adam Smith Review, vol. 4, pp. 89–105. ———, 2017, Love’s Enlightenment. Rethinking Charity in Modernity, Cambridge University Press, Cambridge. Hutcheson, F., 1734, “Reflections Upon Laughter” [1725], in Hibernicus’s Letters: Or, A Philosophical Miscellany, vol. I, 2nd ed., Printed and sold by the Booksellers of London and Westminster, London, pp. 77–107. ———, 2006, Logics, Metaphysics and the Natural Sociability of Mankind [1744–1756], ed. J. Moore & M. Silverthorne, Liberty Fund, Indianapolis, IN. Kuin, I.N.I., 2019, “Diogenes vs. Demonax: Laughter as Philosophy in Lucian”, in P. Destrée & F.V. Trivigno (eds.), Laughter, Humor, and Comedy in Ancient Philosophy, Oxford University Press, Oxford, pp. 725–84. Leddy, N.B., 2008, “Adam Smith’s Moral Philosophy in the Context of 18th-Century French Fiction”, The Adam Smith Review, vol. 4, pp. 159–81. Lucian, 1961, Dialogues of the Dead. Dialogues of the Sea-Gods. Dialogues of the Gods. Dialogues of the Courtesans, ed. M.D. MacLeod, Harvard University Press (“Loeb Classical Library”), Cambridge, MA. Martin, T.R., 2015, “Classical Antiquity and Reading Adam Smith’s Theory of Moral Sentiments. Is the Sunbathing Beggar an Allusion to Diogenes the Cynic and Alexander the Great?”, The Adam Smith Review, vol. 8, pp. 289–98. McDowell, N., 2019, “The Double Personality of Lucianic Satire from Dryden to Fielding”, in P. Bullard (ed.), The Oxford Handbook of Eighteenth-Century Satire, Oxford University Press, Oxford, pp. 145–60. Nussbaum, M., 1990, Love’s Knowledge. Essays on Philosophy and Literature, Oxford University Press, New York – Oxford. Pascal, B., 1901, The Thougths of Blaise Pascal [1670], trans. C. Kegan Paul, Bell & Sons, London. Pitts, J., 2017, “Irony in Adam Smith’s Critical Global History”, Political Theory, vol. 45, no. 2, pp. 141–63. Quintilian, 2001, The Orator’s Education (Institutio Oratoria), ed. D.A. Russell, Harvard University Press (“Loeb Classical Library”), Cambridge, MA), 5 vols.

88  Spyridon Tegos Robinson, C., 1979, Lucian and His Influence in Europe, Duckworth, London. Schliesser, E., 2017, Adam Smith. Systematic Philosopher and Public Thinker, Oxford University Press, Oxford. Sgard, J. (ed.), 1996, Songe, illusion, égarement dans les romans de Crébillon, Ellug, Grénoble. ———, 2002, Crébillon fils. Le libertin moraliste, Desjonquères, Paris. Shaftesbury, 1999a, “A Letter concerning Enthusiasm”, in Shaftesbury, Characteristics of Men, Manners, Opinions, Times [1711], ed. L.E. Klein, Cambridge University Press, Cambridge, pp. 4–28. ———, 1999b, “Sensus Communis. An Essay on Freedom of Wit and Humour”, in Shaftesbury, Characteristics of Men, Manners, Opinions, Times [1711], ed. L.E. Klein, Cambridge University Press, Cambridge, pp. 29–69. Skinner, Q., 2004, “Hobbes and the Classical Theory of Laughter”, in T. Sorell & L. Foisneau (eds.), Leviathan After 350 Years, Clarendon Press, Oxford, pp. 139–66. Tocqueville, A. de, 2010, Democracy in America, vol. 2 [1840], trans. J.T. Schleifer, ed. E. Nolla, Liberty Fund, Indianapolis, IN, vol. IV. Vivenza, G., 2001, Adam Smith and the Classics: The Classical Heritage in Adam Smith’s Thought, Oxford University Press, Oxford.

6 Smith and Hume on imagination and sympathy Stefano Fiori

1 Introduction Since ancient times, the notion of sympathy has been related to that of harmony (of the universe, of the chain of being, of the human community). During the Scottish Enlightenment, however, with Adam Smith, and, to some extent, with David Hume, it was decisively reconfigured for modern thought as a concept capable of accounting for social cohesion and the formation of shared norms. It was analyzed by Darwin, who reinterpreted Adam Smith, and, as a general concept, was reexamined by Kant, Rousseau, and Herder. Scheler, in the 1920s, suggested that sympathy and empathy were connected, and, recently, Rizzolatti and his research group have shown that empathy can be explained on the basis of the functioning of the mirror neurons (Lecaldano, 2013). These topics have been also examined in part of the huge literature on David Hume and Adam Smith, which dealt with two related pairs of concepts in particular: sympathy/empathy and contagion/projection. For the first pair, the question is whether Humean and Smithian sympathy can be interpreted in terms of empathy. Regarding the second pair, many scholars maintain that in Hume, sympathy develops as an automatic emotional contagion, while in Smith, sympathy is a faculty by means of which an individual projects herself toward another person whose passions she reconstructs. The two conceptual pairs are related because one may wonder whether or not sympathy (or, alternatively, empathy) involves processes based on “contagion” or “projection.” Empathy, a term coined in 1909 by Theodor Lipps, usually means immediate understanding of another person’s psychic processes. Lindgren, in reference to Smith, distinguished between “aesthetic sympathy” and “moral sympathy,” where the former coincides with empathy and develops as “an exercise of imagination whereby one man identifies with the cognitive status of another,” while the latter is an “appetitive status” shared by two or more persons (Lindgren, 1973: 24–5). Fontaine maintained that in “sympathy one feels with another, while in empathy one feels into another” and that one form of empathy – “empathetic identification” – “implies an imaginary change of circumstances and

DOI: 10.4324/9781003301448-8

90  Stefano Fiori personhood with another.” Hume and Smith conceived the process through which feelings pass from one individual to another in dissimilar ways: “[w]hereas Hume equated it with contagion or infection, which are merely passive” – and, for this reason, he was “very skeptical as to the feasibility of empathetic identification” – “Smith depicted it as a cognitive process” based on “empathetic identification” (Fontaine, 1997: 262–5). Darwall maintained that empathy consists “in feeling what one imagines [another person] feels” and that “[b]oth Hume and Smith had used ‘sympathy’ to refer to the distinctive forms of empathy they described.” In particular, Hume uses the word “sympathy” to describe the “most rudimentary form of empathy” (Otteson, 2002: 33). He conceived it as an “emotional contagion” – or “contagion” “by communication” – whereby feelings are directly communicated without projection. While for Hume emotional contagion does not necessarily imply awareness of the other as a distinct self, for Smith, “[w]e respond to the other person’s situation as from her standpoint rather than to her reaction or to an imagined version of it” (Darwall, 1998: 261–7). In summary, Fontaine and Darwall agree that Hume and Smith respectively use the notions of “contagion” and “projection.” While Darwall remarks that according to Smith we “feel an imagined surrogate of what the other actually feels” (Darwall, 1998: 267), according to Fontaine, Sugden observes, “Smith’s core concept of identification involves imaginatively becoming the other person” (Sugden, 2002: 75, note 7). The Humean idea of sympathy as “contagion by communication” was analyzed by Philip Mercer in reference to Hume’s theory of impressions and ideas. According to this scholar, Hume considered sympathy as an involuntary process, “a kind of infectious fellow-feeling,” consisting of [t]wo distinct stages […]: (a) from my observation of another’s behaviour and manner I infer his state of mind; and (b) the idea of the affection which I thus entertain is converted into the corresponding impression. (Mercer, 1972: 36) According to this interpretation, in Hume’s Treatise sympathy engenders a “close and intimate […] correspondence of human souls” (Hume, 1960 [henceforth: T], 3.3.2: 592). Therefore, as Ferreira maintained by using Hume’s words, we can conclude that “we can enter into sentiments which ‘in no way belong to us,’ and they affect us only by ‘becoming, in some measure, our own’ ” (Ferreira, 1994: 41; see also Frazer, 2010, chap. 4; Taylor, 2015). Fleischacker seems to share these views. But he remarks that the word “empathy,” since it denotes “a thinking of oneself into other people’s shoes,” is more appropriate for Smith’s account than for Hume’s. Hume used the language of contagion, while Smith opposed to it a “projection”

Smith and Hume on imagination and sympathy  91 account of sympathy, to argue that we imagine ourselves in others’ position (Fleischacker, 2012: 273–7, 291–2). This chapter starts from some aspects of this debate. It is my conviction that according to Smith, in the TMS, when the spectator “thinks herself into other people’s shoes,” she projects herself into the situation experienced by another person, but she does not assume the personhood of the observed person. The spectator preserves her personhood and simply thinks how she would react if she was in the same (moral, empirical, psychological) situation as the observed agent. By contrast, it is Hume’s view of communication of feelings by means of contagion that, under specific conditions, leads in principle to a perfect convergence of identities. Since human beings have a similar anatomical, physiological, and mental structure, when ideas regarding other persons, because of their vivacity, are perceived as impressions by spectators, the distinction among human minds tends to disappear. Smith’s discourse is more complex than Hume’s, although both attribute different features to passions of the body and moral passions. Passions related to the body exhibit similar features because human bodies are similar and react in a similar way. Therefore, it is easy to have an empathetic identification with another person who experiences physical pains or joys. But, alternatively, Smith also points out that we sympathize with others’ moral passions only if we possess a certain knowledge of their situation because only in this way can we formulate judgments (approval or disapproval) of their behavior. These topics are addressed as follows: –

Section 2 analyzes how the concept of sympathy was dealt with over time. In particular, it describes how sympathy (and antipathy) was related to the notion of “animal spirits” as a biological concept that explains the structural resemblance of human bodies and minds. It is this resemblance that makes their reciprocal identification possible; – Section 3 argues that Hume did not reject the concept of animal spirits, and that its acceptance led him to delineate the conditions under which individuals are similar in physical and moral nature; – Section 4 discusses Smith’s view on passions. Bodily passions are similar in all human beings because bodies are similar. By contrast, moral passions are more complex because they are triggered not instantaneously, but only if spectators have a certain knowledge of the situation experienced by other persons. In any case, this does not mean that the identities of spectators and agents overlap, but simply that there is an ideal change of place, where the spectator remains herself, though imagining the empirical and emotional situation experienced by the observed person. Lastly, Section 5 provides some concluding remarks.

92  Stefano Fiori

2  Sympathy: old and new meanings Sympathy denoted harmony of cosmos earlier in stoic philosophy and, later, in the Neoplatonic tradition. Aristotle described imagination as a habit whereby we judge truth or falsity (Aristotle, 1907: 125), and the term sympatheia appeared in a text, which with much doubt could be attributed to him, to identify some properties of human nature: Why is it that when men yawn others usually yawn in sympathy? […]. Why is it that when we see anyone cut or burned or tortured or suffering pain from any other cause, we also suffer in mind? Is it because nature is common to all of us? Hence when we see anything of the kind we feel pain in sympathy with the sufferer, because of our kinship. […] Why are those in contact with phthisis, ophthalmia and scurvy infected by them, but are not infected by dropsy, fever and apoplexy nor by many other diseases? (Aristotle, 1961: 171–7) Phenomena such as “neural mirroring” (yawning) and sharing of other people’s physical pains are apparently considered as events of the same kind, related to our common nature. However, this is not sufficient to explain why some diseases are contagious through physical contact, while others are not. Bodies mysteriously communicate either directly by contact, or indirectly through the sight, and this communication, in certain circumstances implies something that occurs “in the mind.” The idea that sympathetic communication is the consequence of a spiritual element operating in the physical world was developed by Gerolamo Fracastoro in opposition to the idea that certain phenomena depend on celestial influence. He supposed that contagious diseases are caused by corpuscula and seminaria whose action is engendered by attractive or repulsive forces. Contagious diseases, he maintained in De sympathia et antipathia rerum, can be described in these terms because the organic and inorganic world is characterized by “consensus and dissent” (“consensus and dissensus”), or, in other words, by “sympathy and antipathy” (Fracastoro, 2008: 6).1 He identified different kinds of sympathy and antipathy in living and inanimate nature, and maintained that similar bodies have affinities in consequence of which they attract each other, while dissimilar bodies exhibit reciprocal repulsion (Fracastoro, 2008: 39). The notion of affinity also regarded the mental dimension (on these topics see Mercer, 2015). When imagination (“phantasia”) is stimulated by memory, it can thus reveal instances of consensus. This view can also provide an answer to the question posed in the Aristotelian (or pseudoAristotelian) text about the origin of yawns. Yawning awakens the appetite for what is now recognized as good, and this stimulates some bodily reactions. In this sympathetic circumstance, sight plays a fundamental

Smith and Hume on imagination and sympathy  93 role because of its capacity to stimulate the spectator’s imagination in reproducing the physical (and psychological) pains of the observed person, as Montaigne maintains in Chapter 21 of Essays (1571). While Fracastoro’s “spirits” are found in blood and semen, in Descartes, “animal spirits” are tiny bodies that move the limbs. 2 They go rapidly from the heart to the brain and run through nerves and muscles. [E]verything the soul perceives by means of the nerves may also be represented to it through the fortuitous course of the spirits. The sole difference is that impressions which come into the brain through the nerves are normally more lively and more definite than those produced by the spirits. (Descartes, 1985: 338) Not only imaginings (“imaginations”) depend on them (Descartes, 1985: 336), but also the “passions of the soul,” as “perceptions, sensations or emotions” “are caused, maintained and strengthened by some movement of the spirits” (339). Passions of the soul differ from voluntary acts and other forms that require explicit intentions and knowledge because they are “sensations” (“sentiments”), and, as such, they “are received into the soul in the same way as the objects of the external senses” (339).3 Soul and body are tightly connected, and this is further confirmed by the fact that “the ultimate and most proximate cause of the passions of the soul is simply the agitation by which the spirits move the little gland in the middle of the brain” (349). Like Fracastoro (2008: 119), Bacon pointed out the connection among body, animal spirits, and soul, and observed that “sympathies and antipathies” characterize living and nonliving nature4: agreements or sympathies between bodies endowed with sense and between inanimate objects without sense differ only in the fact that in the former case an animal spirit is present in a body equipped to receive it, but is lacking in the latter. (Bacon, 2000: 145) However, he recommended caution in the use of this terminology, as “sympathies and antipathies” are terms that can corrupt “philosophy,” if first we do not discover “the forms and simple structures” of nature (Bacon, 2000: 216). Spinoza reconsidered these themes in Ethics (see Hübner, 2015: 151). “Sympathy or antipathy” refer to “those objects which affect us with pleasure or pain solely because they have some likeness to objects which are wont to affect us in that manner” (Spinoza, 2020: 336–7). This explains why human beings love or hate “certain things.”5 Lastly, he remarked that these phenomena entail imitation of behaviors. This

94  Stefano Fiori approach helped to clarify how the metaphor of “contagion” could be made explicit over time, although Spinoza, like many others, continued to be convinced that moral compassion is not separated from the physical features of the bodies: if we consult our experience, we find that it teaches the same conclusions; especially if we attend to our earlier years. For we observe that children, because their body is continually as it were in equilibrium, laugh and weep solely because they see others laugh and weep; whatever else they see others do, they always wish to imitate, and they desire for themselves everything in which they imagine others to delight, because the images of things, as we have said, are the affections of the human body, or the modes in which the human body is affected by external causes, and is disposed to this or that action. (Spinoza, 2020: 249) Although Descartes tried to explain the passions of the soul by considering the unity of soul (mind) and body as dependent on the movement of the “animal spirits” in the pineal gland, he was unable to detail this connection, as Spinoza pointed out (Spinoza, 2020: 377–80). For Malebranche, too, in De la recherche de la vérité, animal spirits have an important role in the formation of imagination. They agitate the fibers of the brain, and these operations determine changes in the mind. In fact, “if any movement of the spirits occurs in this part, which slightly changes the order of its fibers, a new perception occurs in the soul also” (Malebranche, 1997: 88). From this derives the “faculty of imagining, or the imagination.”6 This anatomical conception is connected with that of “sympathy” as harmony that characterizes the body. In this sense, he speaks of “grande sympathie” or “correspondence” among facial nerves and other places of the body (98). The soul forms images and imprints them in the brain (88). And the more the traces of the animal spirits – which are “the most refined and agitated parts of the blood” (91) – are distinct, the more “strongly and distinctly” the soul represents images of objects (89). Like many others – Fracastoro, for instance, who connected contagion and sympathy in the organic world – Malebranche used the image of the contact between the animal spirits and the parts of the body, especially the brain, to explain coordination between the body and the soul as a condition that makes human beings similar and determines harmonic relations between body and soul.7 What is relevant in this perspective, which can be traced back at least to Plotinus, is the conviction that the anatomy and physiology of the bodies is at the basis of sympathetic relationships among individuals: Thus, it is necessary to know that not only are the animal spirits borne naturally into the parts of our bodies in order to perform the same actions, and the same movements that we see others perform,

Smith and Hume on imagination and sympathy  95 but also for the purpose of suffering their injuries in some way and to share in their miseries. (Malebranche, 1997: 114) A person observing a surgical operation feels pain at the point where the scalpel cuts into the body of another person, with the consequence that “This compassion in bodies produces a compassion in the spirits. It excites us to help others because in so doing we help ourselves” (114). In other words, sympathy emerges from the body because bodies are similar. Although individuals are distinct unities, their anatomical and physiological resemblance determines their reciprocal, spiritual, and emotional identification. This kind of experience is particularly relevant in the relationship between mother and son. In the mother’s womb, infants “see what their mothers see, hear the same cries, receive the same impressions from objects, and are aroused [agités] by the same passions” (Malebranche, 1997: 113). This occurs because [m]others communicate their brain traces to their children, and hence the movement of their animal spirits. Thus do they cause in their children’s minds the same passions and sensations with which they are affected, thereby corrupting their hearts and their reasoning in many ways. (119) Lastly, imitation and imagination help individuals recognize themselves in others (and to recognize others as similar to themselves). Malebranche, like other thinkers, dealt with imitation as a faculty that depends on our physical nature and is able to engender uniformity in human society: “[t]here are powers in our brain that naturally incline us toward imitation, for this is necessary to civil society.” This means that “all men have some disposition to adopt the same manners and perform the same actions as those with whom they wish to live” (113). Imitation is also metaphorically a contagion that affects imagination, and [t]o understand what this contagion is, and how it is transmitted from one person to another, it is necessary to know that men need one another, and that they were created that they might form several bodies, all of whose parts have a mutual correspondence. (161) Imitation and contagion are closely related because [t]hese natural ties we share with beasts consist in a certain disposition of the brain all men have to imitate those with whom they

96  Stefano Fiori converse, to form the same judgements they make, and to share the same passions by which they are moved (161, italics added) where “a strong and vigorous imagination” is the outcome of a “constitution of the brain which renders it capable of having very deep vestiges and traces” (162). Although it is beyond the scope of this essay to analyze in detail the spread of the concepts of sympathy in European culture at the turn of the 17th and 18th centuries,8 some representative authors that took these arguments into consideration should be mentioned. In A Letter Concerning Enthusiasm (1707), Shaftesbury illustrated the spread of panic by means of sympathy (or contact) with the metaphor of contagion by an infectious disease. One may with good reason call every passion “panic” which is raised in a multitude and conveyed by aspect or, as it were, by contact or sympathy. Thus, popular fury may be called “panic” when the rage of the people, as we have sometimes known, has put them beyond themselves, especially where religion has had to do. And in this state their very looks are infectious. The fury flies from face to face, and the disease is no sooner seen than caught. (Shaftesbury, 2000: 10) The idea that passions are contagious also appeared in Hutcheson, who maintained that the stronger motions of the mind are directed toward that which is most necessary. This sympathy seems to extend to all our affections and passions. They all seem naturally contagious. (Hutcheson, 1755: 20) The use of metaphors sheds light on the difficulty of dealing with concepts, like imagination and sympathy, whose properties were perceived, but were not analytically clear (Fiori, 2021, chapter 2). Philosophers intuitively conceived that imagination originates in the brain, and animal spirits were the anatomical substratum of ideas. As Joseph Addison maintained: The Sett of Ideas, which we received from such a Prospect or Garden, having entered the Mind at the same time, have a Sett of Traces belonging to them in the Brain, bordering very near upon one another; when, therefore, any one of these Ideas arises in the Imagination, and consequently dispatches a flow of Animal Spirits to its proper Trace, these Spirits, in the Violence of their Motion, run not only into the Trace, to which they were more particularly directed,

Smith and Hume on imagination and sympathy  97 but into several of those that lye about it: By this means they awaken other Ideas of the same Sett, which immediately determine a new Dispatch of Spirits, but in the same manner open other Neighbouring Traces, till at last the whole Sett of them is blown up, and the whole Prospect or Garden flourishes in the Imagination. (Addison & Steele, 1945: 294 [n. 417. Saturday, June 28, 1712]) To understand how Hume and Smith related to this tradition of thought, it is necessary to summarize some points discussed in this section: 1 the term “sympathy,” consistently with ancient thought, was used to denote harmony in living and inanimate nature as a result of processes that involve direct (contagious) and indirect (observational) contacts; 2 language used to define sympathetic processes was often metaphorical. Expressions like “contagion,” “infectious disease,” and “contact” were metaphors used to represent one domain in terms of another. In particular, features of the biological domain were used to interpret mental and moral domains. Even in the biological domain, features of one sense organ were metaphorically projected to describe features of another sense organ. Thus, like touch literally, sight was metaphorically considered to be a faculty that establishes contact. The word “communication” was also used metaphorically. Malebranche among others used it to indicate how mothers’ “brain traces” and “animal spirits” influence fetuses. Communication evocates conversation and, in this sense, was later used by Hume to illustrate how passions and emotions are transmitted among people; 3 imagination was viewed as a bodily reaction that ultimately depends on animal spirits and operates in individual bodies; 4 sympathy as a faculty that connects passions and emotions of individuals entailed the (logical) passage from individual imagination to shared imagination among individuals; 5 imitation of behaviors and structural resemblance among human bodies were viewed as conditions that strongly influence reciprocal identification among human beings. This made it possible to argue that with different degrees of approximation, one individual could enter into an intimate, moral, relationship with another. Therefore, imitation and sympathy were viewed as faculties that contribute to moral and social uniformity because they reduce individual diversity.

3 Sympathy, imagination, and animal spirits in David Hume Many of the concepts used in the 16th and 17th centuries to explain how imagination and sympathy work can be seen in Hume’s Treatise.

98  Stefano Fiori Hume in Book II divided “perceptions of the mind” into impressions and ideas, and further divided the former into “impressions of sensation” (“original” impressions) and “impressions of reflexion” (“secondary” impressions). Both kinds of impression depend on the animal spirits to varying degrees. Although he maintained that analysis of “[o]riginal impressions or impressions of sensation” is beyond the scope of the Treatise because it refers to “the sciences of anatomy and natural philosophy” (T, 2.1.1: 276), Hume hinted at it: Original impressions or impressions of sensation are such as without any antecedent perception arise in the soul, from the constitution of the body, from the animal spirits, or from the application of objects to the external organs. (T, 2.1.1: 275)9 “Secondary, or reflective impressions,” although different, are not separate from the impressions of sensation, in that they “are such as proceed from some of these original ones, either immediately or by the interposition of its idea.” In short, any impression in some way comes from the body and animal spirits,10 with the difference that some of them are “impressions of the senses,” such as “bodily pains and pleasures,” while others are passions and emotions (T, 2.1.1: 275). The acceptance of the 17th century notion of animal spirits is also clear in other passages. In one of them, Hume describes specific circumstances in which imagination (“fancy”) “rouzes the spirits, and gives an additional force to the passion” (T, 2.3.4: 422). In another passage, he maintains that faculties of the soul are shown little flexibility when the soul is preparing to perform a certain action or to represent an unusual object. This results in “a difficulty of the spirit’s moving in their new direction.” Nonetheless, this difficulty that “excites the spirits” is the source of wonder (T, 2.3.5: 423). In Hume, imagination, impressions, and ideas are notions whose meaning and the terminology used for them reflect conceptions developed in the previous two centuries. This emerges when he observes that whenever the mind dispatches the spirits into that region of the brain, in which the idea is plac’d; these spirits always excite the idea, when they run precisely into the proper traces, and rummage that cell, which belongs to the idea. (T, 1.2.5: 60–1) Usually impressions precede and contribute to the formation of ideas and exhibit a vivacity that ideas do not possess (T, 2.1.11: 319; EHU,

Smith and Hume on imagination and sympathy  99 2.1: 12). But when we analyze sympathy, we discover that its main feature is that ideas become impressions (T, 2.1.11: 317). This leads Hume, like philosophers of the past, to describe human beings as individuals who exhibit similar, bodily characteristics: Now ’tis obvious, that nature has preserv’d a great resemblance among all human creatures, and that we never remark any passion or principle in others, of which, in some degree or other, we may not find a parallel in ourselves. The case is the same with the fabric of the mind, as with that of the body. However the parts may differ in shape or size, their structure and composition are in general the same. There is a very remarkable resemblance, which preserves itself amidst all their variety; and this resemblance must very much contribute to make us enter into the sentiments of others, and embrace them with facility and pleasure. Accordingly we find, that where, beside the general resemblance of our natures, there is any peculiar similarity in our manners, or character, or country, or language, it facilitates the sympathy. (T, 2.1.11: 318, italics added) The “great resemblance among all human creatures” regards “structure and composition” not only of the “the fabric of the body,” but also of the “fabric of the mind.” This determines social uniformity because they result in the “peculiar similarity in our manners, or character, or country, or language.” Moreover, this also explains moral uniformity, since “this resemblance must very much contribute to make us enter into the sentiments of others” and, consequently, facilitate the work of sympathy because – as Hume maintains a few lines earlier – sympathy produces “an equal emotion, as any original affection” experienced by another person (T, 2.1.11: 317; see Mercer, 1972: 26–7). These passages show that processes of identification among individuals can be extremely extensive. The structural resemblance of human beings enables mental barriers among individuals to be overcome, and, although degrees of identification vary, this condition makes it possible for an individual to become the other person to some extent. Identification could be imperfect, if vivacity of impressions is not perfectly transmitted to ideas. However, [t]he stronger the relation is betwixt ourselves and any object, the more easily does the imagination make the transition, and convey to the related idea the vivacity of conception, with which we always form the idea of our own person. (T, 2.1.11: 318)

100  Stefano Fiori In Hume, ideas are associated by means of resemblance, contiguity, and causality, and the more these three conditions are perfectly realized, the more they contribute to a complete identification of agents by means of sympathy. As shown above, the resemblance of bodily and mental structures (“the fabric of the body” and the “fabric of the mind”) helps form sympathetic relationships. In turn, contiguity and causality strengthen the processes of identification: Nor is resemblance the only relation, which has this effect, but receives new force from other relations, that may accompany it. The sentiments of others have little influence, when far remov’d from us, and require the relation of contiguity, to make them communicate themselves entirely. (T, 2.1.11: 318) Lastly, Hume remarks that cultural and kinship relationships are also forms of causality: The relations of blood, being a species of causation, may sometimes contribute to the same effect; as also acquaintance, which operates in the same manner with education and custom […]. (T, 2.1.11: 318) Therefore, the conclusion is that [a]ll these relations, when united together, convey the impression or consciousness of our own person to the idea of the sentiments or passions of others, and makes us conceive them in the strongest and most lively manner. (T, 2.1.11: 318) Impressions and ideas are “perceptions” that “differ only in the degrees of force and vivacity,” but this difference can be “remov’d, in some measure,” because “the component parts of ideas and impressions are precisely alike” (T, 2.1.11: 319). These phenomena directly regard social relationships and clarify “the nature and cause of sympathy,” because they explain the “manner we enter so deep into the opinions and affections of others, whenever we discover them” (T, 2.1.11: 319). People identify with and, to some extent, assume each other’s personhood.11 This occurs not automatically, but only by eliminating the distance between impressions and ideas and as a result of the coordination of resemblance, contiguity, and causality. Initially, the emotional distance among individuals is great. But the more ideas about others assume the form and vivacity of impressions, the more emotional distance is reduced. If this occurs, we partake vividly of

Smith and Hume on imagination and sympathy  101 others’ experiences because “the ideas of the affections of others are converted into the very impressions they represent,” with the consequence that “the passions arise in conformity to the images we form of them” (T, 2.1.11: 319). If so, sympathy renders sentiments of others “intimately present to us,” and reasoning contributes to our sharing others’ opinions (T, 2.1.11: 320). The concept of human nature’s uniformity also provides evidence that differences among individuals are reduced. In Chapter VIII of An Enquiry Concerning Human Understanding, Hume points out that our idea “of necessity and causation arises entirely from the uniformity observable in the operations of nature” (EHU, 8.5: 59–60). This uniformity regards “human motives and actions,” “operations of body” (EHU, 8.8: 61), and even “animal œconomy” (EHU, 8.14: 63), given that human and animal forms of reasoning are similar to some extent (EHU, section IX). In conclusion, Hume provides reasons to argue that individuals are not so different either in physical or in moral nature. In specific circumstances, this makes real empathy possible since individuals can relive others’ experiences, while in Smith, they can never completely overcome the distance that separates them in the moral sphere.12

4  Sympathy and imagination in Adam Smith While Hume’s view is connected to the traditional concept of sympathy as a faculty related to the common features of human beings, capable of creating a close identification among individuals, in Smith’s view, an individual cannot completely identify herself with another person. The spectator can only place herself in the other’s situation, maintaining her identity. It is this specification, not expressed in Hume, that changes the concept of sympathy, as a faculty that operates in the moral sphere. We can imaginatively represent the emotional situation of another person, but we cannot annihilate our personhood by assuming that of the other person (see Otteson, 2002: 20). The famous first sentences of the Theory of Moral Sentiments elucidate this point: As we have no immediate experience of what other men feel, we can form no idea of the manner in which they are affected, but by conceiving what we ourselves should feel in the like situation. Though our brother is upon the rack, as long as we ourselves are at our ease, our senses will never inform us of what he suffers. They never did, and never can, carry us beyond our own person, and it is by the imagination only that we can form any conception of what are his sensations. Neither can that faculty help us to this any other way, than by representing to us what would be our own, if we were in his case. It is the impressions of our own senses only, not those of

102  Stefano Fiori his, which our imaginations copy. By the imagination we place ourselves in his situation […]. (TMS, I.i.1.2: 9, italics added) Signs of the past philosophical tradition are also evident in Smith. Like David Hume (T, 3.3.1: 576), he followed Malebranche’s description of the “compassion in bodies” (Malebranche, 1997: 88; 114), when he analyzed the “Passions which take their origin from the body” (TMS, I.ii.1.1: 27). According to Malebranche, “when we carefully attend to a man someone has rudely struck, or who has a serious wound, the spirits are forcefully borne into the parts of our bodies that correspond to those we see wounded in another” (Malebranche, 1997: 114). Unlike Hume, Smith did not refer to animal spirits to explain this operation, although he provided a description similar to that of Malebranche to show that the spectator to some extent reproduces states of the observed person’s body: When we see a stroke aimed and just ready to fall upon the leg or arm of another person, we naturally shrink and draw back our own leg or our own arm; and when it does fall, we feel it in some measure, and are hurt by it as well as the sufferer. (TMS, I.i.1.3: 10, italics added; see also I.ii.1.5: 29) By means of imagination, human beings continually project themselves in the situation of others, and – Smith remarks – this perception of bodily passions is unproblematic. Apparently, a visual contact is sufficient to trigger a physical reaction in the spectator. The transfusion of bodily emotions is “instantaneous” and “antecedent to any knowledge of what excited them in the person principally concerned” (TMS, I.i.1.6: 11, italics added). While on the one hand, imagination is projective, on the other, bodies are naturally receptive and, so to speak, communicate their states by means of a metaphorical “contagion.” However, this identification implies that we become another person only “in some measure,” because “[i]t is the impressions of our own senses only, not those of his, which our imaginations copy” (TMS, I.i.1.2: 9). In summary, our body reacts by “contagion” to others’ physical states, and engenders “impressions” that are copied by our imagination. Therefore, “we enter as it were into [the other’s] body, and become in some measure the same person with him” (TMS, I.i.1.2: 9) because bodies are extremely similar, although this is not sufficient to produce a change of personhood.13 Things are more complex when one analyzes emotions like grief and joy, in that they are not mere expressions of the body, as are the physical pains that affect “our own leg or our own arm” (TMS, I.i.1.3: 10). These passions require that the causes of the emotional situation experienced by the observed person be known. Without this knowledge, we have

Smith and Hume on imagination and sympathy  103 only a “vague idea of his misfortune” and “our fellow-feeling is not very considerable” (TMS, I.i.1.9: 11–2). In short, while passions of the body are easily transmitted with minimal, bodily information, since the mere sight of a wound is sufficient, “passions of the soul,” as Descartes would have called them, require much more causal knowledge to be communicated because “sympathy with the grief or joy of another, before we are informed of the cause of either, is always extremely imperfect” (TMS, I.i.1.9: 11). Passions of the soul and the body are mostly mixed, but only the former, when experienced by the agent, requires a certain degree of awareness on the part of the spectator to trigger sympathetic processes. In this regard, Smith specifies that “[u]pon some occasions sympathy may seem to arise merely from the view of a certain emotion in another person” (TMS, I.i.1.6:). But this is a mistake because sympathy “does not arise so much from the view of the passion, as from that of the situation which excites it” (TMS, I.i.1.10: 12). In my terms, other’s (moral) passions cannot be communicated automatically, through the spectator’s sight because moral sentiments are engendered not by means of bodily “contagion,” but by the knowledge of the other’s situation. Although Smith does not deal with the role of imagination in whether we perceive passions of the body or “passions of the soul,” the two kinds of passions are distinguished. As regards the “passions of the body,” imagination plays a limited role,14 because our body “instantaneously” (TMS, I.i.1.6: 11) in some way mirrors the physical suffering of “our [tortured] brother” (TMS, I.i.1.2: 9).15 As regards passions that involve moral sentiments, imagination performs a more complex role in reconstructing the situation of the observed person. This reconstructive attitude of imagination, in general, is evident when we ask ourselves what reactions we would feel, if we were in the other person’s place, but were unable to share the other’s feelings. In these cases, it is clear that we do not become the other person, but we remain ourselves. In this regard, a first circumstance occurs when we “blush for the impudence and rudeness of another, though he himself appears to have no sense of the impropriety of his own behaviour” (TMS, I.i.1.10: 12). A second circumstance occurs when a mother attends a sick child. She forms “the most complete image of misery and distress,” while her child “feels only the uneasiness of the present instant” (TMS, I.i.1.12: 12). A third circumstance occurs when we “sympathize even with the dead”: in this case, “we are chiefly affected by those circumstances which strike our senses, but can have no influence upon their happiness” (TMS, I.i.1.13: 12). In all three circumstances, the spectator’s imagination is involved in reconstructing a context, but sympathy, understood as “our fellow-feeling with any passion whatever,” is not involved (TMS, I.i.1.5: 10; see Frazer, 2010: 97–8). Smith does not bring these concepts and distinctions completely into focus. What Smith considers sympathy for the dead – where the dead

104  Stefano Fiori person is the victim of an oppressor – is not real sympathy, but “imaginary resentment which in fancy we lend to the dead, who is no longer capable of feeling that or any other human sentiment” (TMS, II.i.2.5: 71). It is an “illusive sympathy,” that is, “an emotion which the person principally concerned is incapable of feeling” (TMS, II.i.2.5: 71). Therefore, it is important to distinguish between imagination and sympathy. This emerges at least in two circumstances: (1) when imagination relates to passions deriving from the body and does not necessarily anticipate the work of sympathy; (2) when imagination cannot share others’ sentiments. Hume also dealt with similar problems in the section of the Treatise entitled Of compassion. First, he pointed out that the “passion of pity” must be referred to the concept of sympathy, as the capacity to share similar emotions.16 In this context, resemblance, contiguity, and transformation of ideas in impressions influence the formation of sympathy (T, 2.2.7: 369). Second, he maintained, the imagination is affected by the general rule, and makes us conceive a lively idea of the passion, or rather feel the passion itself, in the same manner, as if the person were really actuated by it. From the same principles we blush for the conduct of those, who behave themselves foolishly before us; and that tho’ they shew no sense of shame, nor seem in the least conscious of their folly. (T, 2.2.7: 371) The spectator does not sympathize with the behavior and motivations of foolish people, while she sympathizes with the “passion itself.” She does not identify with the other person, but she deals with the passion not experienced by the agent as her own passion. Not by chance, Hume maintained that this type of compassion is a sympathy “of a partial kind” (T, 2.2.7: 371).

5 Conclusion Many scholars have debated whether the concept of sympathy in Hume and Smith is what we now call “empathy.” Fontaine argued that in “sympathy one feels with another, while in empathy one feels into another” (Fontaine, 1997: 262). By considering this definition, in this chapter, I tried to show that Hume’s notion of “contagion” of physical and moral passions among individuals should be interpreted in terms of empathy. Hume, by following authors of the past, was of the opinion that under certain conditions, emotions, and moral passions can be transmitted from one person to another as a consequence of the uniformity of their physical nature. In particular, the more resemblance, contiguity, and causality favor processes of identification, the more this transmission tends to be complete. This means that if these conditions

Smith and Hume on imagination and sympathy  105 were fully realized, the spectator would identify fully with the other person because her feelings would be identical or extremely similar to those of the other person. If this occurs, the spectator “feels into another.” Like Hume with his implicit distinction between “impressions of sensations” and “reflexive impressions,” Smith distinguished between passions of the body and moral passions. Passions of the body are shared by agents and imply that the spectator “feels into another,” although only “in some measure,” because bodies are naturally receptive. Therefore, physical states are easily, but partially, communicated. As a consequence, it could be assumed that the metaphor of contagion is appropriate to describe our bodily reactions to others’ bodily states. The problem is more complex as regards moral sentiments because Smith clarified that when the spectator places herself in moral and emotional situations experienced by another person, she does not assume her identity, but maintains her own. She simply considers how she would have reacted if, by maintaining her personhood and capacity to formulate moral judgments, she was in her own position. In this case, the more she has knowledge of the other person’s situation, the more she “feels with another.” Sympathetic processes in society lead to the formation of general, shared rules of behavior, and spectators and observed persons continuously try to reduce the moral distance that stands between them. However, this gap can never be completely filled (Fiori, 2021: 139–42). In theoretical terms, this means that in Smith, moral events should be analyzed in their specificity, and not – and not simply – as a mere consequence of our bodily structure.

Notes 1 Della Porta, among others, maintained in Book XX, Chapters IX and XIII, of De Magia (1589) that things and phenomena exhibit either an original affinity or sympathy, due to their resemblance, or an original antipathy, in consequence of which they are opposed. The Greek terms “sympathy and antipathy,” therefore, can be translated as “consonance and discordance.” Later, in the 17th century, Athanasius Kircher was to maintain that an occulta vis, like that of a magnet, connects all aspects of the world. 2 Hübner, 2015: 147 maintains that “many early moderns did not reject the notion of ‘sympathy’ tout court.” Descartes also refers to animal spirits in the Treatise on Man and in the Discourse on Method. 3 Note that passions of the soul are divided into those “caused by the soul” and those “caused by the body” (Descartes, 1985: 338, note 1). 4 Sympathy indicates a universal capacity of attraction among things. Therefore, Bacon defines the force between the globe of the earth and heavy things, or between the globe of the moon and the waters of the sea (which seems very likely in the high and low tides twice a month), or between the starry heaven and the planets, by which they are called up and raised to their agogees as a “magnetic force operating by agreement” or sympathy (Bacon, 2000: 184).

106  Stefano Fiori 5 Spinoza points out that these phenomena are related not only to “occult qualities,” as authors in earlier centuries maintained, but also to “manifest qualities.” 6 The latter consists only in the soul’s power of forming images of objects producing changes in the fibers of that part of the brain which can be called the principal part, because it corresponds to all the parts of our body, and is the place where the soul immediately resides, if one may so speak. (Malebranche, 1997: 88) 7 The brain traces are linked to each other, and are followed by movement of the animal spirits, that the traces aroused in the brain arouse ideas in the mind, and that the movements excited in the animal spirits excite passions in the will. (Malebranche, 1997: 101) 8 See Forget, 2003. In An Essay Concerning Human Understanding (Book II, Chap. 8, § 4), Locke maintains that perception depends on animal spirits. In turn, in Essay on the Origin of Human Knowledge (Chap. 9, § 82), Condillac explains imagination and madness as a consequence of vivacity and abundance of “spirits.” 9 Also in An Enquiry Concerning Human Understanding Hume shows that he is persuaded of the existence of the animal spirits and maintains that they are responsible for the movements of limbs (Hume, 2007 [henceforth: EHU], 7.14: 48–9). 10 “[A]ll our perceptions are dependent on our organs, and the disposition of our nerves and animal spirits” (T, 1.4.2: 211). 11 The principle of sympathy is of so powerful and insinuating a nature, that it enters into most of our sentiments and passions […] passion can proceed from nothing but sympathy. The sentiments of others can never affect us, but by becoming, in some measure, our own; in which case they operate upon us, by opposing and encreasing our passions, in the very same manner, as if they had been originally deriv’d from our own temper and disposition. (T, 3.3.2: 593) 12 For the Smithian problem of “distance” between spectator and agent, and in relation to the “impartial spectator,” see Forman-Barzilai, 2010: 156–7; Paganelli, 2010; Fiori, 2021: 140–5. 13 However, Smith maintains: “[w]hen I condole with you for the loss of your only son, […] I should suffer if I was really you, and I not only change circumstances with you, but I change persons and characters” (TMS, VII. iii.10.4: 317). These sentences, although they apparently contradict what Smith says about the fact that sympathy does not involve a change in the spectator’s personhood, are intended to show that individuals are not selfish when they sympathize. 14 This role exists because only by means of imagination “we can form any conception of what are [the observed person’s] sensations” (TMS, I.i.1.2: 9). 15 Moreover, perception of others’ physical pains is not homogeneous: We conceive in a much more lively and distinct manner the pain which proceeds from an external cause, than we do that which arises from an

Smith and Hume on imagination and sympathy  107 internal disorder. I can scarce form an idea of the agonies of my neighbour when he is tortured with the gout, or the stone; but I have the clearest conception of what he must suffer from an incision, a wound, or a fracture. (TMS, I.ii.1.10: 30) 16 “We have a lively idea of every thing related to us. All human creatures are related to us by resemblance. Their persons, therefore, their interests, their passions, their pains and pleasures must strike upon us in a lively manner, and produce an emotion similar to the original one; since a lively idea is easily converted into an impression” (T, 2.2.7: 369).

References Addison, J. & R. Steele [and others], 1945, The Spectator in Four Volumes [1711-1712], ed. G. Smith, with an Introduction by P. Smithers, Dent, London, vol. 3. Aristotle, 1907, De Anima, trans. R.D. Hicks, Cambridge University Press, Cambridge. ———, 1961, Problems I. Books I–XXI, trans. W.S. Hett, Harvard University Press, Cambridge, MA. Bacon, F., 2000, The New Organon [1620], ed. L. Jardine & M. Silverthorne, Cambridge University Press, Cambridge. Darwall, S., 1998, “Empathy, Sympathy, Care”, Philosophical Studies, vol. 89, no. 2–3, pp. 261–82. Descartes, R., 1985, The Passions of the Soul [1649], in The Philosophical Writings of Descartes, ed. J. Cottingham, R. Stoothoff & D. Murdoch, Cambridge University Press, Cambridge, vol. I. Ferreira, M.J., 1994, “Hume and Imagination: Sympathy and ‘the Other’”, International Philosophical Quarterly, vol. 34, no. 1, pp. 39–57. Fiori, S., 2021, Machines, Bodies and Invisible Hands. Metaphors of Order and Economic Theory in Adam Smith, Palgrave Macmillan, Cham, Switzerland. Fleischacker, S., 2012, “Sympathy in Hume and Smith: A Contrast, Critique, and Reconstruction”, in C. Fricke & D. Føllesdal (eds.), Intersubjectivity and Objectivity in Adam Smith and Edmund Husserl, Ontos Verlag, Frankfurt a.M., pp. 273–312. Fontaine, P., 1997, “Identification and Economic Behavior. Sympathy and Empathy in Historical Perspective”, Economics and Philosophy, vol. 13, no. 2, pp. 261–80. Forget, E.L., 2003, “Evocations of Sympathy: Sympathetic Imagery in Eighteenth-Century Social Theory and Physiology”, History of Political Economy, vol. 35, no. 5, pp. 282–308. Forman-Barzilai, F., 2010, Adam Smith and the Circles of Sympathy. Cosmopolitanism and Moral Theory, Cambridge University Press, Cambridge. Fracastoro, G., 2008, De Sympathia et Antipathia Rerum. Liber I [1546], ed. C. Pennuto, Edizioni di Storia e Letteratura, Roma. Frazer, M.L., 2010, The Enlightenment of Sympathy. Justice and the Moral Sentiments in the Eighteenth Century and Today, Oxford University Press, Oxford. Hübner, K., 2015, “Spinoza’s Parallelism Doctrine and Metaphysical Sympathy”, in E. Schliesser (ed.), Sympathy. A History, Oxford University Press, Oxford.

108  Stefano Fiori Hume, D, 1960, A Treatise of Human Nature [1739–1740], ed. L.A. Selby-Bigge, Clarendon Press, Oxford. ———, 2007, An Enquiry Concerning Human Understanding [1748], ed. P. Millican, Oxford University Press, Oxford. Hutcheson, F., 1755, A System of Moral Philosophy, in Three Books, A. Millar, London, vol. I. Lecaldano, E., 2013, Simpatia, Raffaello Cortina, Milano. Lindgren, R.J., 1973, The Social Philosophy of Adam Smith, Martinus Nijhoff, The Hague. Malebranche, N., 1997, The Search after Truth [1674–1675], trans. and ed. T.M. Lennon & P.J. Olscamp, Cambridge University Press, Cambridge. Mercer, C., 2015, “Seventeenth-Century Universal Sympathy. Stoicism, Platonism, Leibniz, and Conway”, in E. Schliesser (ed.), Sympathy. A History, Oxford University Press, Oxford. Mercer, P., 1972, Sympathy and Ethics. A Study on the Relationship between Sympathy and Morality with Special Reference to Hume’s Treatise, Clarendon Press, Oxford. Otteson, J.R., 2002, Adam Smith’s Marketplace of Life, Cambridge University Press, Cambridge. Paganelli, M.P., 2010, “The Moralizing Role of Distance in Adam Smith: The Theory of Moral Sentiments as Possible Praise of Commerce”, History of Political Economy, vol. 42, no. 3, pp. 425–41. Shaftesbury, 2000, “A Letter Concerning Enthusiasm to My Lord” [1707], in Shaftesbury, Characteristics of Men, Manners, Opinions, Times [1711], ed. L.E. Klein, Cambridge University Press, Cambridge. Spinoza, B., 2020, Ethics [1677], trans. G. Eliot, ed. C. Carlisle, Princeton University Press, Princeton. Sugden, R., 2002, “Beyond Sympathy and Empathy: Adam Smith’s Concept of Fellow-Feeling”, Economics & Philosophy, vol. 18, no. 1, pp. 63–87. Taylor, J., 2015, Reflecting Subjects. Passion, Sympathy, and Society in Hume’s Philosophy, Clarendon Press, Oxford.

7 Adam Smith and the creative role of imagination Keith Hankins and Brennan McDavid

1 Introduction Scholars interested in Adam Smith’s account of imagination have traditionally distinguished between two aspects of our capacity for imagination, or, alternatively, between two domains in which it operates: that of “sympathetic” or “practical” imagination, on one hand, and “nonsympathetic” or “theoretical” imagination on the other.1 The former is exercised in the moral and social domains of life, where we “chang[e] places in fancy” with fellow human beings and, thereby, acquire moral understanding of them and deepen our understanding of ourselves (TMS, I.i.1.3: 10). Theoretical imagination, in contrast, is exercised in relation to objects and natural phenomena and, so, involves no imaginary changing of places. Instead, it involves a search for harmony and orderliness among observed phenomena and involves positing – that is, imagining – relationships between seemingly disparate events and objects. These two modes of imagination are brought together again by the common limit on their exercise. As the traditional reading instructs us, Smith follows Hume’s epistemology in setting the limit of imagination. 2 In Hume’s words, the limit is established by our inability to “step beyond ourselves” or to “conceive any kind of existence, but those perceptions, which have appear’d in that narrow compass” (Hume, 2007, 1.2.6.8: 49).3 Or, to use Smith’s way of expressing this idea, “[i]t is the impressions of our own senses only, not those of [another’s], which our imaginations copy” (TMS, I.i.1.2: 9). For both Smith and Hume, our understanding of the world is built entirely out of our own experiences, but imagination enriches these experiences by allowing us to see the world as (we imagine) others do, and, more generally, by giving us a tool for exploring how the objects of our experience might be related to each other. There is, however, a significant disadvantage of the traditional reading, namely that it scarcely allows room for the exercise of imagination in the sphere of technological progress. That is, sympathetic imagination, conceived as “changing places” with another, and theoretical imagination, conceived as positing orderliness and harmony in the natural

DOI: 10.4324/9781003301448-9

110  Keith Hankins and Brennan McDavid world, do not seem to accurately describe what occurs in the mind of an inventor who develops a new product or way of doing things. Consider Smith’s description of a boy who invents a mechanism for automating his work as a valve actuator: In the first fire-engines, a boy was constantly employed to open and shut alternately the communication between the boiler and the cylinder, according as the piston either ascended or descended. One of those boys, who loved to play with his companions, observed that, by tying a string from the handle of the valve, which opened this communication, to another part of the machine, the valve would open and shut without his assistance, and leave him at liberty to divert himself with his play-fellows. One of the greatest improvements that has been made upon this machine, since it was first invented, was in this manner the discovery of a boy who wanted to save his own labour. (WN, I.i.8: 20–1) It may be the case that this inventive boy is motivated by “changing places in fancy” with his playfellows and discovering the joy to be had outside of the factory. And it may also be the case that an exercise of imagination brings him to comprehend the working of the engine and the regularity of its moments. But neither of these exercises of imagination is sufficient for explaining how the boy could conceive of a way of excising himself from the role he played in the engine by developing a mechanism that exploits the engine’s own pattern of movement. Technological invention, in other words, is a product of imagination, but not simply sympathetic or theoretical imagination. Unless we want to concede that Smith left a significant lacuna in his account of imagination, then, an alternative account must be provided that is capable of explaining technological applications of imagination on par with moral and philosophical applications. The purpose of this chapter is to provide such an account. Our goal, however, is not to reject other accounts, so much as it is to enrich them. Where other scholars have described imagination’s operation as varying in accordance with the domain in which it is exercised, we propose to describe it as varying in accordance with what we call the “mode” of its operation. For Smith, we contend, our faculty of imagination may be exercised in either a mimetic mode or a creative mode, with the former tending to operate closer to our personal impressions and the latter farther way. As we will show, either mode may be exercised in any domain, but each domain imposes unique boundaries on imagination’s mode of operation. A secondary, but equally important contention of this chapter is that this account of imagination is indicative of the unity of Smith’s work. In

Adam Smith and the creative role of imagination  111 particular, we argue that Smith’s discussion of imagination is consistent across all of his works, and that his complete account emerges only after we account for what he has to say in The Wealth of Nations (WN), as opposed to focusing primarily on the Theory of Moral Sentiments (TMS) and History of Astronomy (HA) as other commentators have done.

2  A Humean conception of imagination There are two features of the traditional reading of Smith’s account of imagination that are indisputable. The first is that Smith explicitly describes two different domains – the practical and the theoretical – in which imagination is deployed. Whether Smith means to draw a sharp distinction between these domains, and whether these are the only ways in which imagination operates, is a matter to which we will return, but we must begin our discussion with the second important consensus in the existing literature: that Smith’s account of imagination is broadly Humean. Hume describes imagination as a mental operation akin to memory. “[B]oth these faculties borrow their simple ideas from the impressions, and can never go beyond these original perceptions” (THN, 1.3.5.3: 59). We are able to differentiate acts of imagination from acts of remembering only through the “superior force and vivacity” of memory (THN, 1.3.5.3: 60). Imagination is dim and weak, both in comparison with memory, and even more so in comparison with the original impressions. Further, imagination “transposes and changes” ideas rather than, as memory does, faithfully presenting them in the order in which they were received by the senses (THN, 1.3.5.3: 59). This last feature largely informs imagination’s distinctive function, namely, to posit connections between our experiences. Specifically, imagination compensates for the fact that sensory perception is limited to discrete and distinct impressions by manufacturing accounts of how those impressions are related to one another (THN, 1.1.5.1: 14–5; 1.3.1.1: 50). It is through imagination that we generate the notion of continuity of existence, for example (THN, 1.4.2.20–21: 130–2). This function is exercised not for its own sake, though, but for the way it quells the anxieties and agitations of our mind when we are confounded by seemingly incoherent impressions (THN, 1.4.2.36: 136). Imagination returns us to tranquility by persuading us that there is order in our universe. Smith endorses all the features and the function of imagination in Hume’s account. Consider, for example, this passage from the beginning of the TMS: It is the impressions of our own senses only, not those of his, which our imaginations copy. By the imagination we place ourselves in his

112  Keith Hankins and Brennan McDavid situation, we conceive ourselves enduring all the same torments, we enter as it were into his body, and become in some measure the same person with him, and thence form some idea of his sensations, and even feel something which, though weaker in degree, is not altogether unlike them. (TMS, I.i.1.2: 9) Here, imagination is limited to drawing on our own sensory impressions. The idea generated through the act of imagining is “weaker in degree” than the impressions present to the person actually enduring the situation, or than the impressions that would be present to us were we to actually endure it. It involves a transposition of ideas – in this case, positing a change of situation for ourselves. And imagination performs the function of positing an account or model for a set of experiences. Prospectively imagining ourselves in the place of another allows us to predict how they will behave, and retrospectively doing so provides us with a tool for making sense of the sentiments of others when they appear discordant with our own. It is in Smith’s earlier work, HA, however, where he most clearly embraces the functional aspect of Hume’s account of imagination. There Smith describes science as leveraging the imagination to build accounts of nature that accommodate seemingly anomalous observations. It is via imagination that the scientist posits relationships not directly observed between events that are. Scientific theories are more or less successful in accordance with the greatness of their power for accommodating observations. Newton’s theory of gravity – a favorite of Smith’s – succeeds because it is “a system whose parts are all more strictly connected together, than those of any other philosophical hypothesis” (HA, IV.76: 104). Nevertheless, Smith cautions us – in a passage starkly reminiscent of Hume – to hold Newton’s principles at arm’s length lest their explanatory power lure us into believing that “they were the real chains which Nature makes use of to bind together her several operations” (HA, IV.76: 105).4 However significant the scientific account may be, Smith reminds us that “all philosophical systems [are] mere inventions of the imagination” (HA, IV.76: 105). Smith even adopts Hume’s theory of motivation for imagination. He says that the intellectual sentiments of wonder and surprise, which agitate us, inspire the scientist to manufacture their clever accounts, all in an effort to return to the pleasures of mental tranquility. This point is most explicit in his discussion of Apollonius’ achievements: “[n]othing can more evidently show, how much the repose and tranquility of the imagination is the ultimate end of philosophy” (HA, IV.13: 61). Prior to Apollonius, astral observations “had appeared inconstant and irregular;” the effect of this seeming incoherence was that they “tended to embarrass and confound the imagination, whenever it attempted to

Adam Smith and the creative role of imagination  113 trace them” (HA, IV.13: 61). Apollonius’ account of Eccentric Spheres, “Epicycles,” and of the revolution of the centers of the Eccentric Spheres gained traction precisely because it “tended to allay this confusion, to connect together those disjointed appearances, and to introduce harmony and order into the mind’s conception of the movements of those bodies” (HA, IV.13: 61–2). 5

3  Invention and technological progress If it is relatively settled in Smith scholarship that Smith’s conception of imagination in TMS and HA is Humean, it is less well attested whether WN follows the same script. Of course, as a systemic account of our social world, WN itself is plausibly an “invention of the imagination,” as Charles Griswold has observed.6 But this perspective does not account for the role imagination plays internal to the theory of that text. More promising is the conjecture, also advanced by Griswold (among others), that Smith’s story of economic progress driven by the division of labor is premised on the idea that individuals are motivated by what their imaginations suggest for bettering their condition.7 The literature is silent, however, in accounting for the mechanics of how imagination plays this role. How can Smith’s distinctively Humean account of imagination, characterized primarily as an exercise in “changing places in fancy” and filling gaps in our understanding, drive technological progress? The importance of technological invention to Smith’s account of economic progress is clear from the very outset of WN. Smith relates invention to the division of labor in the opening chapter of the work: A great part of the machines made use of in those manufactures in which labour is most subdivided, were originally the inventions of common workmen, who, being each of them employed in some very simple operation, naturally turned their thoughts towards finding out easier and readier methods of performing it. (WN, I.i.8: 20) Innovations in machine design are “natural” developments when work is specialized. The attention that an individual devotes to their singular task admits a privileged understanding of the processes involved in the task, and this understanding is the fount of technological invention. The question for us is whether invention is a product of the imagination, and, if so, whether the account of that imagination is consistent with the Humean conception that Smith leans on elsewhere. We contend that the answer to both parts of this question is yes. Inventors who improve upon existing machines, for instance, typically generate their ideas on the basis of sensory impressions of how the machine performs its task, with the ideas themselves being suppositions about how to fill

114  Keith Hankins and Brennan McDavid in gaps between impressions. Recall the boy who invents the automatic valve actuator. His work as a manual actuator requires him to observe the regular motion of the machine’s piston; his task being to “open and shut alternately the communication between the boiler and the cylinder, according as the piston either ascended or descended” (WN, I.i.8: 20). The boy has discrete impressions of the parts of the machine, of their movements, and of the timing of their movements. Such impressions are crucial to his ability to coordinate his own movements for operating the valve correctly, and they are also apt to generate ideas of the regularity and interdependency of the machine’s movements. Having noticed that his intervention with the valve mimics a tether between the valve and piston, a supposition emerges that the imagined tether may be materialized with an actual string. The boy “invents,” however, not with the mere supposition, but when he manifests it materially.8 In becoming observable, the boy’s invention improves the machine and may then figure in the impressions of future operators, thus fueling further improvements.9 Not all inventions are improvements upon existing machines, though, nor are users of machines the only contributors to technological improvement. Smith notes that “the makers of the machines” carved off their own specialized trade and that “those who are called philosophers or men of speculation” have even contributed to such progress (WN, I.i.9: 21).10 What he says of the philosopher, in particular, invites a Humean analysis. The trade of philosophers, much like that of scientists, is “not to do any thing, but to observe every thing,” because, in so doing, they become “capable of combining together the powers of the most distant and dissimilar objects” (WN, I.i.9: 21). The idea that philosophers are “combining” objects that are distant and dissimilar is both figurative and material. The ‘combination’ first occurs figuratively when, in their imaginations, the philosopher draws connections between distant ideas, just as the inventive boy supposes a tether between valve and piston, and then materially in the making of the machine. Imagination in the technological sphere thus operates with the same Humean mechanisms operative in the theoretical and social spheres. But how should we account for the initial impetus to imagine in the technological domain? In line with those scholars who argue that it is the general desire to “better our condition,” Smith does say of the boy who worked the valve that he “loved to play with his companions,” and that the invention of the automated valve actuator afforded him “liberty to divert himself with his play-fellows” (WN, I.i.8: 20). But how exactly does the desire to better his condition lead the boy to invent a better fire engine? The key to understanding this is to appreciate the relationship between our labor and the machines that augment it. Labor and machinery are both elements in the production of goods, and it is precisely because the automated valve actuator provides a substitute for his labor that the boy is able to play rather than work. Just as it does in the

Adam Smith and the creative role of imagination  115 theoretical realm, then, imagination manifests itself in the boy inventor’s mind in the rearrangement of ideas – in this case, substituting a string or mechanical tether for the role he previously played synchronizing the movements of the fire engine’s piston and valve – and by providing an effective substitute for his labor, the boy’s invention thereby establishes a new order and harmony in the workplace. This account of imagination in the technological sphere highlights a defect in the scholarly tendency to build a sharp distinction between sympathetic and theoretical imagination. Invention is more than only a theoretical exercise. Though many of the ideas of famous inventors have never come to fruition – for example, the more fantastical machines of da Vinci’s imagination – successful invention requires harnessing the imagination for designing something realizable. Further, and perhaps more significant, technological invention appears to be driven by an exercise of “changing places in fancy”: the boy imagines himself in the situation of his playfellows, economic agents imagine betterment for their condition.11 If we want to paint a complete and consistent picture of the role imagination plays in Smith’s work, we cannot simply redeploy the distinction between sympathetic and theoretical imagination. We need to enrich our picture of the ways in which imagination operates.

4  Two modes of imagination To better track the richness of Smith’s account of imagination, we propose a new distinction between two modes in which imagination operates: the mimetic and the creative. This distinction is intended to complement rather than supplant the traditional distinction between sympathetic and theoretical imagination. In particular, whereas the traditional distinction emphasizes the object or domain of imagination, this distinction focuses on the imaginative process itself. In every domain in which imagination is possible, whether for navigating the social world, reaching for mental tranquility, or bettering our material condition, the imaginative process may be either mimetic or creative. Understanding this distinction aids us in appreciating not only how imagination operates in particular contexts, but also one of the ways in which Smith’s thought is unified across his corpus.12 Imagination operates in its mimetic mode when it draws material from an agent’s existing stock of impressions, ideas, and experiences in order to fill in the gaps in a new situation or context. The new context itself is relatively simple and straightforward. That is, the gaps that need filling are narrow and suggestive of their own solution. The boy who improves the fire engine provides a paradigm of such imagining. The gap in the machine that his labor fills is a narrow one, fillable by a mere string. And the gap suggests the solution of the string through its being recognized in the mind’s eye of the boy as a line of direct connection

116  Keith Hankins and Brennan McDavid between movements in the machine. Imagining the gap as a line, the boy simply supplies the materialization of the line, i.e. a string. This mode of imagination is ubiquitous, Smith tells us, and not only in the sphere of technological invention where “a great part of the machines” were invented by workers like the inventive boy, but also in the social sphere (WN, I.i.8: 20). At the beginning of TMS, Smith describes imagination with examples drawn from ordinary and therefore common experience. The examples are all simple and mimetic: witnessing a blow about to be struck on another person, watching a dancer on a slack rope, or passing by someone with visible sores (TMS, I.i.1.3: 10). In these cases, Smith suggests that we ourselves are apt to recoil in anticipation of the blow, twist and writhe as if we were on the rope, or scratch the corresponding parts of our bodies. In each case, the gap to be filled is our understanding of the other’s feelings or thoughts, and, because their situation is relatively simple, the gap to be filled is narrow and even suggested by the situation. The perspective of the slack rope walker, for example, is easily filled out by drawing on our experiences with walking on steady and unsteady, broad and narrow walkways. The mimetic mode may be operative even in cases that seem quite remote from our own experiences. Consider Smith’s discussion of our tendency to sympathize with the dead. Never having been dead, it might seem that we are scarcely in a position to draw from our own experiences for filling the gap in our understanding of the dead’s perspective. Indeed, there is no perspective of the dead that meaningfully needs supplying anyway. Nevertheless, imagination projects our own experiences and their corresponding emotions upon the corpse. It is miserable, we think, to be deprived of the light of the sun; to be shut out from life and conversation; to be laid in the cold grave, a prey to corruption and the reptiles of the earth; to be no more thought of in this world, but to be obliterated, in a little time, from the affections, and almost from the memory, of their dearest friends and relations. (TMS, I.i.1.13: 12) The imaginative mode is simple and mimetic even for all its false supposition. It is a mere “pictur[ing] out” of what would occur to us if we were to find ourselves in the situation under consideration.13 What we call the creative mode, on the other hand, is neither straightforward nor common. In this mode, imagination leverages its ability to rearrange ideas to generate more speculative accounts of how the world might be. These accounts are complex because they typically involve at least one relatio and many relata, with the relata often being quite distant and seemingly unconnected. We have already seen several examples of such creativity: the invention of the fire engine, Apollonius’ account

Adam Smith and the creative role of imagination  117 of the movement of the heavens, Newton’s law of gravity. In all of these examples, imagination is not limited to drawing on ideas that narrowly reproduce the imaginer’s stock of experiences. In positing unobserved (and perhaps unobservable) laws of nature, or in proposing altogether new ways of harnessing the forces of nature, science and philosophy are capable of – and sometimes must – transcend past impressions and offer radical alternatives to traditional ways of thinking. That is, when exercised in the creative mode, imagination involves altogether new ways of arranging ideas. Relations are drawn between distant ideas where we may have previously seen no relationship, and in doing so speculative proposals concerning how the world is, or might be made to be, are put forward. To be sure, such imagination is rare, in keeping with the difficulty of drawing connections between widely distant phenomena. What we want to argue here is not just that we can find examples of mimetic and creative imagination in Smith’s work, though. Instead we want to show how the distinction helps us make sense of the role imagination plays throughout his corpus. Accordingly, we will now turn our attention to the role imagination plays in Smith’s accounts of economic progress in WN, of sympathy and moral evaluation that we find in TMS, and of science that we find in HA and some of Smith’s other essays. 4.1  Imagination in The Wealth of Nations Having shown that Smith relies on a Humean conception of imagination in WN and plausibly divides its operation into two modes, we now want to demonstrate more fully how this complex account of imagination is deployed throughout the work. Economic activity is complex, involving both a technological and a social dimension. Imagination, in both of its modes, is exercised in each of these dimensions. We have already discussed some examples of imagination in the technological dimension: the invention of the fire engine and the improvement of its valve actuator illustrate the exercise of creative and mimetic imagination. In the social dimension, imagination shapes and even makes possible many of the elements that constitute economic activity. The division of labor, specialization, trade, the utilization of a currency, and expansion of the market are just a few of the critical elements of economic activity that depend on imagination for their possibility. This is so because economic agents are pressed upon to utilize their imaginations for “form[ing] any conception” of the self-interested motives that will facilitate their successful exchange of goods with other agents (TMS, I.i.1.2: 9). Human beings, unlike other animals, have “almost constant occasion for the help of [their] brethren” (WN, I.ii.2: 26). The quantity of goods we need to consume outstrips our capacity for production, so we must appeal to others to provide us with what we cannot provide ourselves. The mode of this appeal is the starting point of trade and the division

118  Keith Hankins and Brennan McDavid of labor, and it is driven by imagination. We are unable to rely on the benevolence of our fellows, Smith observes, and so we are inclined to offer to others some goods that they desire in exchange for goods we desire for ourselves. “Give me that which I want, and you shall have this which you want, is the meaning of every such offer” (WN, I.ii.2: 26). We picture out in our minds what may be the objects of desire for this particular person in possession of the goods we need, and we go about either manufacturing those goods or else procuring them by some other means. Such imagination is basically mimetic, with each party to trade filling the gap of their understanding of what the other might desire by drawing on their own impressions of what goods are most needed. In commercial societies, where participants in trade are many and labor is divided and specialized, participants shift from considering the particular needs of every potential trading partner to relying on a universally desired medium of exchange. [E]very prudent man in every period of society, after the first establishment of the division of labour, must naturally have endeavoured to manage his affairs in such a manner, as to have at all times by him, besides the peculiar produce of his own industry, a certain quantity of some one commodity or other, such as he imagined few people would be likely to refuse in exchange for the produce of their industry. (WN, I.iv.2: 37–8) In other words, once markets become extensive, success requires us to draw generalizations about people whose tastes are varied and whose preferences often diverge. This is no easy task, though, and so to better facilitate trade, we find that throughout human history – Smith says, “[i]n all countries” – economic agents have overcome the limitations of barter through the invention of money (WN, I.iv.4: 38). Money – whether commodity or fiat – is universally valuable precisely through our collective capacity to imagine it as universally valuable. And while it may have been an act of imagination in its creative mode that first gave rise to the idea of utilizing metals for exchange, or to the idea of stamping precious metals in particular ways, in most times and places, mimetic imagination is all that is needed for the average person to appreciate the utility of currency. Our lives are rich with experiences of individuals trading their goods for coinage of a particular type. Imagination is also relied upon by merchants seeking a market for their goods. Exercising imagination, the merchant constructs an account of potential buyers in a new market – that is, he makes a prediction – by drawing on his experience of the prevailing prices of goods and what goods have been in demand there. Producers of goods, who might not always act as merchants themselves, must also make these predictions

Adam Smith and the creative role of imagination  119 and others besides. For instance, what should be produced and in what quantities? What sort of inputs to production need to be acquired, and how many laborers should be employed in production? Answering each of these questions requires merchants and producers to exercise imagination, both mimetically and creatively, to determine how best to utilize their resources and maximize their gain. Whether mimetic or creative imagination is called for is a function of the distance between the familiar markets and goods and the prospective markets and goods. When a merchant brings a product to a far distant market full of goods he scarcely recognizes, he is unable to rely on the familiar value comparisons of his home market but is pressed to imagine how these new buyers might perceive similarities and dissimilarities between his product and those with which they are familiar. The producer, too, will exercise mimetic or creative imagination in line with the distance between the familiarity and unfamiliarity of the good they are producing to the intended buyers for that good. This distinction governs which mode of imagination they will exercise in relation to each of the myriad elements of their production process.14 Of course, there is no guarantee that all such exercises of imagination will be fruitful. Smith warns of imagination’s power to mislead in his example of the Roman agriculturalist Columella. Guided by the principle that “the vineyard, when properly planted and brought to perfection, was the most valuable part of the farm,” Columella “imagined” that new plantings of vineyards would return profits far exceeding their expense (WN, I.xi.b.27: 170). In fact, the gain from new vineyards rarely matches the gain from established vineyards, so Columella’s imagination led him to loss. But despite imagination’s capacity sometimes, or perhaps even often, to lead us astray, we persist in exercising it in the service of the “propensity to truck, barter, and exchange” (WN, I.ii.1: 25).15 This propensity, Smith argues, gives rise to the division of labor and all the advantages that flow from it. Imagination, then, is indispensable to our economic progress. Most significant of all is imagination’s role in relation to what is arguably Smith’s most influential observation: that the division of labor is limited by the extent of the market (WN, I.iii: 31–6). As Smith explains it, the extent of the market just is the extent of the power of economic agents to “exchange all that surplus part of the produce of his own labour, which is over and above his own consumption, for such parts of the produce of other men’s labour as he has occasion for” (WN, I.iii.1: 31). Labor will further divide only in light of opportunities to trade away all surpluses. Imagination shapes both our perception of these opportunities but also the opportunities themselves. We cannot doubt that Smith perceives certain circumstances to be hard determinants of the extent of the market. For example, he says that “[t]here are some sorts of industry, even of the lowest kind, which can be carried on no where

120  Keith Hankins and Brennan McDavid but in a great town” (WN, I.iii.2: 31). But he also makes out specialization and market participation to depend on one’s feelings of “encouragement,” and, as we have seen, he depicts agents as determining what goods, how many, and at what price, by their exercise of imagination (WN, I.iii.1: 31). Insofar as the expansion of the market directly depends on the increase of surpluses brought to trade, it directly depends on the imaginations of potential producers of those surpluses. Further, imagination – particularly creative imagination – is the engine that generates the improvements in cargo transportation that Smith argues “ope[n] the whole world for a market to the produce of every sort of labour” (WN, I.iii.4: 34). Imagination cannot be understood as the sole determinant of the extent of the market in Smith’s account, but it contributes in significant ways, just as we would expect for an economist who appreciated that economic agents are, foremost, human beings. 4.2  Imagination in the Theory of Moral Sentiments As we acknowledge at the outset of this chapter, the fact that imagination is a crucial cognitive faculty in Smith’s theory of moral and social development is clear and well attested. What we want to draw attention to here is how the distinction between mimetic and creative imagination helps us to better understand the role imagination plays. Imagination is significant in moral development because it is the mechanism through which we generate the standpoint of the impartial spectator that governs our moral evaluations of ourselves and others. Specifically, the impartial spectator is a product of our imagination that balances our own judgments against the judgments that others could be expected to make by considering how other people might react to the object of shared judgment.16 In so doing, the impartial spectator guides our conduct and provides us with a mechanism for checking the partiality of our own judgments while also resisting the judgments of our fellows in cases for which we have privileged information, e.g., concerning our motives.17 The impartial spectator thus facilitates consensus with others, and, in so doing, promotes cooperation and reduces the costs and likelihood of conflict.18 It may be that Smith thinks a capacity for consulting an imagined impartial spectator is universal (or nearly so), and that having this capacity is sufficient for membership in the moral community. But he also clearly suggests that some, but probably not all, individuals are capable of achieving expertise in the moral domain. He first describes such a person in the context of explaining that we typically find most pleasant those people whose sentiments mirror our own: But when [their sentiments] not only coincide with our own, but lead and direct our own; when in forming them he appears to have

Adam Smith and the creative role of imagination  121 attended to many things which we had overlooked, and to have adjusted them to all the various circumstances of their objects; we not only approve of them, but wonder and are surprised at their uncommon and unexpected acuteness […]. (TMS, I.i.4.3: 20) Here, the moral exemplar is distinguished as a leader, as uncommonly observant, and surprisingly acute in assessing salient connections. This language already suggests the creativity of the philosophical inventor in WN, but Smith goes further: The decision of the man who judges that exquisite beauty is preferable to the grossest deformity, or that twice two are equal to four, must certainly be approved of by all the world, but will not, surely, be much admired. It is the acute and delicate discernment of the man of taste, who distinguishes the minute, and scarce perceptible differences of beauty and deformity; it is the comprehensive accuracy of the experienced mathematician, who unravels, with ease, the most intricate and perplexed proportions; it is the great leader in science and taste, the man who directs and conducts our own sentiments, the extent and superior justness of whose talents astonish us with wonder and surprise, who excites our admiration, and seems to deserve our applause: and upon this foundation is grounded the greater part of the praise which is bestowed upon what are called the intellectual virtues. (TMS, I.i.4.3: 20) Smith surely does not mean that the individual who judges well in the moral sphere and adopts praiseworthy sentiments is a “man of taste” or a mathematician, but he does seem to suggest that expertise exists in the moral domain just as it does in the scientific or aesthetic, and that such experts are endowed with uncommon cognitive gifts. One way in which a moral expert might excel is by being especially attuned to the judgments of others. Smith does not seem to have that in mind, or at least not just that. For Smith, the moral expert is distinguished by the way she imagines the impartial spectator. In forming her conception of the impartial spectator, she is not bound to the actual judgments of other agents. Instead, the moral expert’s conception of the impartial spectator allows her to pursue what is praiseworthy above what is merely praised, and so makes room for moral aspiration. Of course, Smith declares generically that “[m]an naturally desires, not only to be loved, but to be lovely; or to be that thing which is the natural and proper object of love” (TMS, III.2.1: 113), implying that all human beings pursue what is praiseworthy above what is praised. But he does not mean that all human beings succeed in satisfying this desire. It is the

122  Keith Hankins and Brennan McDavid person of virtue alone who is able to successfully track what is praiseworthy and blameworthy and mold their own sentiments and conduct in accord with those standards. And because consultation with an imagined impartial spectator is the cognitive exercise by which we make our pursuit of praiseworthiness, it must be that any difference between the ordinary moral agent and the virtuous one is located in their different ways of doing such imagining. All people are bound by their own experience in imagining their impartial spectator. That is the message Smith conveys when he says that [t]he man who is conscious to himself that he has exactly observed those measures of conduct which experience informs him are generally agreeable, reflects with satisfaction on the propriety of his own behaviour. (TMS, III.2.5: 116) But the ordinary agent and the person of virtue, though both are bound to their personal stock of experience, differ greatly in how they relate the various elements of their experience to one another and to the present moral situation that calls for their judgment. In calling forth memories of behavior being praised, the ordinary moral agent is limited in his ability to assess the true praiseworthiness of such behavior. The person of virtue, to the contrary, is empowered by the knowledge of the good and confident in its value. Her impartial spectator is imbued with virtue, a paradigm of what Smith describes as the height of moral wisdom: To obtain the approbation of mankind, where no approbation is due, can never be an object of any importance to him. To obtain that approbation where it is really due, may sometimes be an object of no great importance to him. But to be that thing which deserves approbation, must always be an object of the highest. (TMS, III.2.7: 117) To enter into the judgments of such an impartial spectator, a moral agent must be capable of bringing together quite dissimilar and far distant notions. Where memory serves to illustrate an immediate connection between praise and, say, heralding traditionally held beliefs, a more advanced moral agent may imagine a connection between praise and the challenging of beliefs. And, while experience might not provide ready examples of such connections, for the expert, it may afford the material out of which an act of imagination may create such connections. Socrates – no doubt present in Smith’s mind – drew such a connection in his imagination. It certainly was not illustrated plainly for him among his fellow Athenians. But through an exercise of imagination, he was

Adam Smith and the creative role of imagination  123 able to draw together two notions that lay quite far apart in his experience. He created something new, and he imbued his daimonion with the consequent value judgment, thereby setting the invented morality as his own standard.19 This, of course, is not to say that the virtuous moral agent should be unconcerned with the judgments of others. She almost certainly should be. But by freeing herself to consider what others do not (or even cannot), the individual exercising creative imagination in the moral domain affords herself the possibility of becoming more virtuous, or, at least, a means of standing strong in the face of the undeserved judgment of others. Insofar as morality is a collective enterprise, though, what ultimately matters is the extent to which a moral exemplar like Socrates succeeds in persuading others to follow their example. For it is in moving our collective imaginations that moral progress resides. But notice that here the challenge of moving others has its benefits, for there is no guarantee that creative exercises of the moral imagination will in fact point us in the direction of progress. 4.3  The role of imagination in science We have seen, in Section 3, that Smith’s account of science and invention motivates a need to distinguish between the creative and mimetic roles of imagination. What we did not emphasize in the subsequent discussion of that distinction, however, was that the mimetic mode of imagination is crucial to science. In particular, the mimetic imagination often creates the preconditions for engaging the sentiments that motivate the exercises of creative imagination through which these sentiments can be quelled. This is because it is the mimetic imagination that takes our everyday observations of apparent regularities in the universe and translates them into our folk understanding of both the laws of nature and the manmade world. In other words, it is only because our mimetic imagination infers causal relationships from observed correlations, that allow us to be surprised by observations that do not fit with our preconceived notions of how the world works. 20 Nor is this something that is only reflected in our folk understandings of the world. Much of so-called ‘normal science’ proceeds on the basis of mimetic imagination. Astronomers record the movements of heavenly bodies against the backdrop of a working theory of how they move through space. In this context, most discoveries are simply instances of filling in the gaps in our knowledge. For instance, discovering a new planet might be a matter of seeing something that was previously overlooked or too faint to see, as one might through a more powerful telescope. But occasionally, our working theories are cast into doubt by observations that they cannot explain, and this is where the creative imagination bears its fruit.

124  Keith Hankins and Brennan McDavid

5 The scope of imagination and the bounds of community Having explored how the distinction between mimetic and creative imagination helps us make sense of the role imagination plays in Smith’s thought, we want to conclude by suggesting that the distinction is perhaps most important because it allows us to resolve a puzzle otherwise presented by the limits of our imaginative capacities. As Smith recognized, and as contemporary empirical research has borne out, there are limits to our capacity for imagination. Our ability to sympathize with others diminishes as they (or the circumstances they inhabit) become more different from our own. Likewise, our ability to predict how things will turn out diminishes as we begin to imagine circumstances that differ substantially from those with which we have had experience. A significant worry about the limits of our imaginative capacities is that these limits can be self-reinforcing. The bounds on our moral imagination incline us towards a parochialism that inhibits us from welcoming outsiders into our moral community, and the bounds on the size of our moral community in turn limit the extent of the market and the possibility for economic progress that markets facilitate. Accounting for the creative role of imagination, however, allows us to see how constraints on our moral and economic relations can be overcome. Nor is the progress spurred by creative exercises of imagination limited to the domain in which imagination is exercised. Because moral relations facilitate economic relations and vice versa, creative exercises of imagination in one domain can spawn progress in others. Distinguishing between the mimetic and creative modes of imagination and accounting for the ways in which they each operate across various domains thus sheds new light on two ways in which Smith’s corpus is unified. On one hand, the same account of imagination is at work throughout his corpus, and, on the other hand, crucial to Smith’s account of moral, economic, and scientific progress is the fact that creative exercises of imagination in one domain can facilitate progress in others.

Notes 1 See, e.g., Griswold, 1998. For assertion that these constitute “two fundamentally different kinds of imagination,” going beyond the idea that they are distinct operations of essentially the same faculty, see Haakonssen, 2006: 10. 2 The claim that Smith’s epistemology and especially his account of imagination is borrowed from Hume is well attested among scholars. See, e.g., Skinner, 1974 and Raphael, 1977. 3 The citation here follows standard practice in referring to the book, part, section, and paragraph of Hume’s Treatise (henceforth: THN) followed by the corresponding page number in the Clarendon edition of the text.

Adam Smith and the creative role of imagination  125 4 Hume makes this argument in the section of the Treatise titled “Of scepticism with regard to the senses.” See Raphael, 1977, for discussion of how Hume’s insistence that imagined connections are “fictions” differs from Smith’s characterization of them as “inventions,” and what implications this may have for their respective theories of the possibility of scientific knowledge. See also Hanley, 2010 for a persuasive argument that Smith followed Hume’s naturalism more so than his scepticism. 5 The fuller passage further clarifies imagination’s role in restoring tranquility. Although Apollonius’ ideas referenced above succeeded in introducing “uniformity and coherence” (HA, IV.13: 62) into our understanding of the direction of movement of the heavenly bodies, they did so imperfectly. The ideas of Eccentric Spheres and Epicycles were insufficient to account for the observed velocities of objects that “remained, in some measure, inconstant as before; and still, therefore, embarrassed the imagination” (HA, IV.13: 62). The invention of the Equalizing Circle was the true achievement of imagination. With it [t]he mind found itself somewhat relieved from this embarrassment, when it conceived, that how irregular soever the motions of each of those Circles might appear, when surveyed from its own centre, there was, however, in each of them, a point, from whence its revolution would appear perfectly equable and uniform, and such as the imagination could easily follow. Those philosophers transported themselves, in fancy, to the centres of these imaginary Circles, and took pleasure in surveying from thence, all those fantastical motions, arranged, according to that harmony and order, which it had been the end of all their researches to bestow upon them. (HA, IV.13: 62) 6 Griswold, 2006: 50. 7 See Griswold, 2006: 23; Haakonssen, 2006: 10–1. 8 This differentiates technological invention from scientific or philosophical invention, which trades in systematic description rather than in material ordering. Smith compares scientific systems with material machines explicitly in HA, IV.19: 66: Systems in many respects resemble machines. A machine is a little system, created to perform, as well as to connect together, in reality, those different movements and effects which the artist has occasion for. A system is an imaginary machine invented to connect together in the fancy those different movements and effects which are already in reality performed. 9 This fits with Smith’s claim, in LRBL, I.v.34: 13 that “machines […] at first are vastly complex but gradually the different parts are more connected and supplied by one another.” The passive voice (“are more connected and supplied”) obscures the mechanism of improvement, but invention is undoubtedly the process. 10 In the early draft of WN, Smith conjectures that “[i]t was a real philosopher only who could invent the fire engine” (ED, 19: 570). 11 The sharp distinction between sympathetic and theoretical imagination is further undermined by the intrusion of sympathetic imagination in the scientific works. For example, in his discussion of Apollonius’s idea of Equalizing Circles, Smith uses language remarkably similar to his characterization of sympathy, describing philosophers as “transport[ing] themselves, in fancy, to the centres of these imaginary Circles” (HA, IV.13: 62). Even Griswold

126  Keith Hankins and Brennan McDavid has observed that Smith characterizes science as a “spectatorial endeavor” and repeatedly invokes the metaphor of the “theatre of nature” (Griswold, 1998: 69). See HA, II.12: 46; IV.13: 62 as well as in AP, 2: 107. 12 Griswold, 1998 makes several references to the “creative” role of imagination, but does not develop the idea in the way we do here. In particular, he does not contrast the creative mode in which imagination operates with anything like the alternative mimetic mode that we claim is the more common operation of imagination. 13 Smith uses the “picturing out” language in TMS, I.i.3.4: 17–8, where he returns to the example of sympathizing with a passerby displaying obvious signs of grief who we are told has just learned of his father’s passing. There Smith suggests that our own experience allows us to appreciate that the grief-stricken man is deserving of sympathy even if we do not engage in the imaginative exercise of putting ourselves in his shoes. Our sympathy is enhanced, however, when we actually imagine ourselves in his place, and thereby enrich our understanding of his situation by recalling our own experience with grief and using it to fill out our picture of what he must be experiencing. 14 Smith’s discussion of the watch-maker is illustrative here. Compare WN, I.x.c.16: 139–40 and LJB, 225: 495. As Smith points out in WN, the initial invention of such beautiful machines “must […] have been the work of deep thought and long time, and may justly be considered as among the happiest efforts of human ingenuity.” And in LJB, he points out that the watchmaker “must be acquainted with several sciences in order to understand his business well, such as arithmetic, geometry, and astronomy with regard to the equation of time,” and there Smith does not even mention familiarity with the properties of metals that is no doubt of equal importance. But once watchmaking is an established trade, Smith suggests (again in WN) that “[l]ong apprenticeships are altogether unnecessary” and that the exercises of imagination needed to do the job well no longer require the imaginative leaps they once did. 15 Interestingly, the majority of explicit mentions of “imagination” in WN characterize failures of imagination. This need not worry us, though. Even if most attempts at invention fail to improve our lives in meaningful ways, some inventions, like the steam engine, surely do improve our lives, and, as we have already seen, imagination plays a crucial role in generating ideas from whence such inventions emerge. Similarly, even if most merchants fail to earn the profits they hope for, the profit motive is crucial to the functioning of markets, and it is from the imagination that we generate ideas for where and how profit might be sought. 16 See especially TMS, I.i.4.6–10: 21–3 where Smith first describes how this perspective-taking occurs, although he does not introduce the term “impartial spectator” for the product of this perspective-taking exercise until the following chapter. 17 Smith’s characterization of the impartial spectator at TMS, II.ii.2.1: 83 nicely captures this idea: When he views himself in the light in which he is conscious that others will view him, he sees that to them he is but one of the multitude in no respect better than any other in it. If he would act so as that the impartial spectator may enter into the principles of his conduct, which is what of all things he has the greatest desire to do, he must, upon this, as upon all other occasions, humble the arrogance of his self-love, and bring it down to something which other men can go along with.

Adam Smith and the creative role of imagination  127 See also the discussion in TMS, I.iii.1: 43–50. 18 For recent and more extensive discussion of the role the impartial spectator plays in this regard, see, e.g.: Hankins & Thrasher, 2021 or Schliesser, 2017, chap. 5.f. 19 Socrates’ daimonion is the “divine or spiritual sign” that, in Plato’s Apology, he says appears to him as “a voice” directing him away from participation in public life (Apology, 31c). 20 Although he does not describe things in terms of the distinction between mimetic and creative imagination that we explore here, for a nice discussion of this aspect of Smith account of imagination, see Schliesser, 2017, chap. 3.C. Note, too, as Schliesser points out, that this dynamic is indicative of at least one way in which Smith’s account of imagination departs from Hume’s. Specifically, Smith seems to allow that in helping us form predictions about what we expect, imagination can utilize ideas in an anticipatory manner (that is, in situations where these ideas are not precipitated by impressions).

References Griswold, C., 1998, Adam Smith and the Virtues of Enlightenment, Cambridge University Press, Cambridge ———, 2006, “Imagination: Morals, Science, and Arts”, in K. Haakonssen (ed.), The Cambridge Companion to Adam Smith, Cambridge University Press, Cambridge, pp. 22–56. Haakonssen, K., 2006, “Introduction: The Coherence of Smith’s Thought”, in K. Haakonssen (ed.), The Cambridge Companion to Adam Smith, Cambridge University Press, Cambridge, pp. 10–22. Hankins, K. & J. Thrasher, 2021, “Smithian Sympathy and the Emergence of Norms”, Philosophy and Phenomenological Research, . Hanley, R.P., 2010, “Scepticism and Naturalism in Adam Smith”, in V. Brown & S. Fleischacker (eds.), The Philosophy of Adam Smith, Routledge, London, pp. 198–212. Hume, D., 2007, A Treatise of Human Nature, ed. D.F. Norton & M.J. Norton, Clarendon Press, Oxford, vol. I: Texts. Raphael, D.D, 1977, “‘The True Old Humean Philosophy’ and Its Influence on Adam Smith”, in G.P. Morice (ed.), David Hume: Bicentenary Papers, University of Texas Press, Austin, pp. 23–38. Schliesser, E., 2017, Adam Smith: Systematic Philosopher and Public Thinker, Oxford University Press, Oxford. Skinner, A.S., 1974, “Adam Smith: Science and the Role of the Imagination,” in W.B. Todd (ed.), Hume and the Enlightenment: Essays Presented to Ernest Campbell Mossner, Edinburgh University Press, Edinburgh, pp. 164–88.

8 Adam Smith on natural education and moral conscience Riccardo Bonfiglioli

1 Introduction: a natural education in society and morality Something seems to educate human beings if it is capable of deeply touching their existences. Something can authentically touch human existence if it is in connection with the deepest material needs or moral desires of human nature. How could these suggestions be related to Adam Smith’s conception of natural education? In this essay, I argue that, in Adam Smith’s moral philosophy, the human being’s moral conscience would be founded on a natural self-education. This natural education will be understood here as a self-correction by the human being in terms of a spontaneous self-command (emotion regulation) that would be the natural consequence of the sympathetic and emulative consideration of others and their judgments by a human being. In turn, this kind of education would be based on the natural tendency of human beings to relate with others in order to gratify the natural desire1 of human nature to be deservedly approved by the internal and the external spectators, 2 on which human happiness is based, since childhood. Many authors have highlighted the question of education in Smith, from different points of view. Conventionally, distinction could be made between scholars attentive to an education in moral terms (Berry, 2006; Brown, 2007; Carrasco, 2012; Evensky, 2005; Firth, 2007; Frazer, 2010; Fricke, 2013; Griswold, 1999; Hanley, 2009; Heydt, 2008; Rothschild, 1998; 2001; Weinstein, 2007; 2013), others more sensitive to a public education in political and economic terms (Blaug, 1975; Heilbroner, 1982; Thomas, 2018; 2019), or legal terms (Cairns, 1992; 1993), and others again involved in an historical reconstruction of Smith’s conception of education (Emerson, 2008). 3 In this scholarly context, this work seeks to go deeper into Smith’s conception of a natural education concerning all human beings4 since childhood, based on human nature, and not a general education in public terms (WN, V.i.f-g). Unlike Thomas (2018; 2019), who focused on a kind of education that has to be inculcated from outside, what I would provide here is the idea that in Smith, there is another complementary

DOI: 10.4324/9781003301448-10

Adam Smith on natural education and moral conscience  129 and fundamental idea of education that would be the result of a twofold process of naturalization of the social dimension (the relationship with others is naturally educational) and of socialization of the natural dimension of human beings (a self-command in terms of emotional regulation;5 sympathy and the desire to gain a merited approbation underlie selfhood and the conduct in society) with effects on the development of human subjectivity in moral and modern terms (the formation of the moral conscience). Generally, Smith identifies two kinds of education6 for human beings:7 1 “[T]he most vulgar education” that teaches a human being to act “with some sort of impartiality between ourselves and others, and even the ordinary commerce of the world is capable of adjusting our active principles to some degree of propriety;” 2 “The most artificial and refined education” that could “correct the inequalities of our passive feelings; and we must for this purpose, it has been pretended, have recourse to the severest, as well as to the profoundest philosophy” (TMS, III.3.7: 139).8 Assuming this distinction, in order to problematize the link between natural education and moral conscience in Smith, I focus here on the first stage of the first kind of education shared by all common human beings (TMS, VI.ii.1.10). In Smith, this conception of education concerns what allows the preservation of the commercial society9 in terms of active conduct, given the possibility for human beings to express their nature. In particular, this kind of education – regulating feelings or emotions – influences the propriety of the conduct upon which human beings can be deservedly approved by other spectators, satisfying the human desire to gain a merited approbation by other spectators.10 According to Smith, the feelings of a human being constitute the model by which that human being naturally judges the feelings11 of others (TMS, I.i.3.1–2).12 For Smith, a human being can understand others on the basis of his or her own feeling and experience. At the same time, human feelings underlie human conduct. Therefore, judgment on human conduct occurs after considering the proper or improper proportion between the cause of the affection that motivates it through the eyes of the impartial spectator (TMS, III.2.9), its end and its effects, and the expression of the emotion underlying the action of the human being judged. In other words, if, in the situation of the other, a human being imagines that they feel and express the same emotions, on the basis of their own experience, bringing the case back to themselves, there is approbation through a sympathetic judgment (TMS, II.i.3.3). In this sense, one must not only have lived or experienced the other’s experience, but also a similar way of feeling, of reacting emotionally to that experience in order to understand and share it.

130  Riccardo Bonfiglioli Assuming that moral judgment and action are based on feelings for Smith (TMS, I.i.3.5), the secret of education is to direct, for example, vanity, meant as an attempt to gain a true glory, to proper objects (TMS, VI.iii.46). I could say that the essence of Smith’s conception of education is to direct sentiments in general to a proper aim in order to gratify the natural desire to be deservedly approved. In this sense, Smith’s conception of natural education concerns the moral attempt to direct the judgments of the impartial spectator regulating emotions at the basis of the human conduct: The judgments of the man within the breast, however, might be a good deal affected by those reasonings, and that great inmate might be taught by them to attempt to overawe all our private, partial, and selfish affections into a more or less perfect tranquility. To direct the judgments of this inmate is the great purpose of all systems of morality. (TMS, VII.ii.1.47: 293) At the same time, for Smith, it is nature that, firstly, through feelings, directs human beings to correct that distribution of things that it had itself arranged in order to preserve the order of the world and to lead human beings to happiness (TMS, III.5.9). More particularly, what motivates human beings’ conduct according to Smith? Smith writes: He is mortified upon both accounts; for though to be overlooked, and to be disapproved of, are things entirely different, yet as obscurity covers us from the daylight of honour and approbation, to feel that we are taken no notice of, necessarily damps the most agreeable hope, and disappoints the most ardent desire of human nature. (TMS, I.iii.2.1: 51) According to Smith, to be an object of “honour and approbation” is the most ardent desire of human nature: in this sense, the human being seeks love, attention and sympathy, trying to gain approbation by other spectators on one’s own conduct. Increased wealth is also a means of gratifying this moral need (WN, II.iii.28).13 In particular, it is the consciousness of being loved that gives a sensitive human being as well as a coarse human being a satisfaction that brings more benefits than love itself (TMS, I.ii.4.1). According to Smith, every human being naturally desires not only to be loved, but to be worthy of love, a natural and proper object of love (TMS, III.2.1), to be conscious of being loved. Human beings desire to make themselves a proper object of esteem, becoming estimable (TMS, VII.ii.4.9). It is the consciousness of being deservedly approved that sustains the agent’s

Adam Smith on natural education and moral conscience  131 standard of conduct (TMS, IV.2.8) and the conduct is the object of the judgment by the moral conscience, thanks to which human beings can gain a merited approbation in society. In this sense, Smith writes: Kindness is the parent of kindness; and if to be beloved by our brethren be the great object of our ambition, the surest way of obtaining it is, by our conduct to show that we really love them. (TMS, VI.ii.1.19: 225) On the contrary, in this context, for Mandeville (1988), the human being wants to be praised regardless of the merit of the praise of their actions. Smith calls superficial and frivolous those who rejoice in undeserved praise (TMS, III.2.11). The desire to be proper objects of approval is not vanity, but love of virtue and glory. And for Smith, love of virtue is instead the noblest passion of human nature (TMS, VII.ii.4.8), the most sublime motive of human nature (TMS, VII.ii.4.10). According to Smith, Mandeville makes the mistake of representing every passion as wholly vicious when it is vicious to some degree. Mandeville starts from two premises: he identifies virtue in the extirpation of the passions and connects man’s industriousness to these passions. Thus, on the one hand, he deduces that since it is impossible for man to have this total control of the passions, man will always be vicious. On the other hand, he adds that this fact is positive because society rests on this very vicious nature of the human being. Differently, in relation to another important source of Smith’s philosophy, the position of Hutcheson can be defined unilateral: being virtuous means acting with the most disinterested benevolence. In Hutcheson (2002), for example, self-love is viewed negatively and condemned in all its manifestations. For Smith, an egoistic motive cannot underlie an action defined as virtuous (TMS, VII.ii.3.6). Even self-approbation, namely the comfort that comes from the praise of our imaginary impartial spectator, would diminish the merit of the action according to him.

2 The fundamental stage of “natural education”: childhood, sympathy and self-correction Now, I would like to explore the link between natural education and moral conscience in relation to the figure of the child, in order to show the context where Smith speaks of natural education. According to Smith, the child wants naturally to gain the approval of those close to him (TMS, III.2.31).14 If a child is not recognized by his parents, he cannot survive. The child manifests his needs and desires through emotions such as fear and anger: a language that only an indulgent and loving parent can understand. In this context, the child starts controlling anger and those passions or emotions inciting him to attack (TMS, III.3.22).

132  Riccardo Bonfiglioli Generally, when a parent blames the child for this excessive expression of his needs, the child tries unintentionally to control his impulsive instinct, fearing losing the love of his sympathetic parents on which he depends. Then, in society, the search for love and merited approbation by other people less indulgent than parents leads children to amend the expression of their emotions (emotion regulation). In this regard, Smith connects the role of society and natural education: Bring him into society, and he is immediately provided with the mirror which he wanted before. It is placed in the countenance and behaviour of those he lives with, which always mark when they enter into, and when they disapprove of his sentiments; and it is here that he first views the propriety and impropriety of his own passions, the beauty and deformity of his own mind. (TMS, III.1.3: 110) In this naturally educative context, the moral conscience starts to be formed (TMS, III.3.4). Again Smith: In the same manner our first moral criticisms are exercised upon the characters and conduct of other people; and we are all very forward to observe how each of these affects us. But we soon learn, that other people are equally frank with regard to our own. We become anxious to know how far we deserve their censure or applause, and whether to them we must necessarily appear those agreeable or disagreeable creatures which they represent us. We begin, upon this account, to examine our own passions and conduct, and to consider how these must appear to them, by considering how they would appear to us if in their situation. We suppose ourselves the spectators of our own behaviour, and endeavour to imagine what effect it would, in this light, produce upon us. This is the only looking-glass by which we can, in some measure, with the eyes of other people, scrutinize the propriety of our own conduct. If in this view it pleases us, we are tolerably satisfied. We can be more indifferent about the applause, and, in some measure, despise the censure of the world; secure that, however misunderstood or misrepresented, we are the natural and proper objects of approbation. On the contrary, if we are doubtful about it, we are often, upon that very account, more anxious to gain their approbation, and, provided we have not already, as they say, shaken hands with infamy, we are altogether distracted at the thoughts of their censure, which then strikes us with double severity. (TMS, III.1.5: 112) Therefore, when growing up, a human being internalizes the values of the community and learns to see himself in light of others (Schliesser,

Adam Smith on natural education and moral conscience  133 2017).15 In this sense, the natural and sympathetic regard16 for the sentiments of others is at the basis of the internalization of others in the shape of moral conscience (Forman-Barzilai, 2010; Haakonssen, 1981). In other words, assuming the weakness of human nature (TMS, IV.2.8), in the sympathetic contact with others, the human being starts to internalize the presence of the others in himself and to correct himself in society.17 In this direction, Griswold writes: “Thus a key aim of moral education is the development of a sense of conscience and duty” (Griswold, 1999: 214).18 In this regard, in the framework of this naturally sympathetic process, outside the family circle, according to Fricke, an agent learns from an external spectator to look at himself as his own spectator: [W]here people interact as peers, without the “indulgent partiality” with which an educator addresses a child, and without the natural trust a child has in its educators, an agent can find himself confronted with the antipathy and disapproval of his spectator and moral judge, and this disapproval can represent a challenge for both of them. (Fricke, 2013: 183) The natural sympathy of every human being predisposes a human being to a relationship with the others in which the moral conscience, the possibility of a self-relationship, arises (TMS, III.2.31).19 When a child relates to others, he naturally learns that he has to accord the expression of his feelings to the emotions of others if he wishes to be corresponded by them, to earn their sympathy, gratifying and realizing his natural desires. 20 Smith writes: This natural disposition to accommodate and to assimilate, as much as we can, our own sentiments, principles, and feelings, to those which we see fixed and rooted in the persons whom we are obliged to live and converse a great deal with, is the cause of the contagious effects of both good and bad company. (TMS, VI.ii.1.17: 224) This process is what Smith called “the great school of self-command” (TMS, III.3.21–22) and in this sense, I can speak of natural education. 21 In this sense, Smith writes: If we examine the different shades and gradations of weakness and self-command, as we meet with them in common life, we shall very easily satisfy ourselves that this control of our passive feelings must be acquired, not from the abstruse syllogisms of a quibbling dialectic, but from that great discipline which Nature has established

134  Riccardo Bonfiglioli for the acquisition of this and of every other virtue; a regard to the sentiments of the real or supposed spectator of our conduct. (TMS, III.3.21: 145) According to Smith, there is a natural discipline at the basis of the regard for the sentiments of the other spectator in relation to human conduct. In this framework, Fricke linked the theme of what I called natural education to the formation of conscience, 22 saying that a natural sympathetic process is the basis on which the human being makes a moral judgment of himself: [M]oral conscience as conceived by Smith enables a person to intentionally take the role of an impartial spectator. Such a spectator makes moral judgments, either of himself or of other people, based on sympathetic processes rather than on the application of general moral principles. (Fricke, 2013: 178) According to her, the conscience in a child has the role of restraining undisciplined selfish passions (see also Heilbroner, 1982) and this moral conscience is connected to the natural instinct of the child to be corresponded by his peers: for example, actions arising from properly moderated self-love, a feeling where we find a material need of preservation and a social desire to be praiseworthy (TMS, VII.ii.3.15; cf. Force, 2003; Maurer, 2019), will be praised by others and thereby promote both the human being agent’s happiness and social harmony within his community (Fricke, 2013; Griswold, 1999). In Fricke (2013), the moral conscience is thus meant as a means to control emotions, such as selfinterest, in order to obtain the approval of others in an ancient way. 23 I agree with Fricke (2013), Forman-Barzilai (2010), Haakonssen (1981) and Griswold (1999) that education is at the basis of the moral conscience, and I add here that this moral conscience in Smith is also linked with the automatic and natural self-correction generated by the relation with others, based on the principles of a social and sympathetic human nature (TMS, I.i.4.7). I called natural education this process (see TMS, VI.ii.1.17), where “natural” refers to a set of processes that will unfold on their own, unless impeded or skewed. As Samuel Fleischacker wrote: Common sense is fluidly self-corrective, if it is, because it responds quickly and precisely to empirical data. Ordinary people, even without education, are constantly engaged in adjusting their beliefs to accord with what they see and hear around them, and this is sufficient, Smith believes, for them to work out most of what they need to know about their fellow human beings, especially those they

Adam Smith on natural education and moral conscience  135 observe often. Hence “every individual can, in his local situation, judge much better than any statesman or lawgiver can do for him.” (Fleischacker, 2004: 28) Similarly, Charles Griswold wrote: Moral education does not consist in self-command that focuses simply on suppressing the “selfish” passions and instilling “selfdiscipline,” and the virtues we must acquire are not to be reduced to one. The virtuous person feels the right things at the right times in the right way. Although the “untaught and undisciplined feelings” (TMS, III.3.28: 148) need constant tutoring, the ultimate aim is propriety and proportion, not extirpation of emotions. One discerns in the background a critique of an excessively religious moral education that would treat certain emotions as though they were enemies within. (Griswold, 1999: 212) In Smith, the moral conscience would be the result of a natural tendency of human beings to correct themselves with others within an historical context shaping the standard on which the impartial spectator judges. In particular, natural education would not only be at the basis of a conscience in terms of extirpation of the selfish passions (TMS, III.3.13), but rather of a mutual accord of free emotions expressed in a proper way among human beings, starting from the social experience of others (TMS, VII.iv.28) since childhood. The great school of self-command and the course of natural order are the main features/qualities of this natural education. Smith writes: A very young child has no self-command; but, whatever are its emotions, whether fear, or grief, or anger, it endeavours always, by the violence of its outcries, to alarm, as much as it can, the attention of its nurse, or of its parents. While it remains under the custody of such partial protectors, its anger is the first and, perhaps, the only passion which it is taught to moderate. By noise and threatening they are, for their own ease, often obliged to frighten it into good temper; and the passion which incites it to attack, is restrained by that which teaches it to attend to its own safety. When it is old enough to go to school, or to mix with its equals, it soon finds that they have no such indulgent partiality. It naturally wishes to gain their favour, and to avoid their hatred or contempt. Regard even to its own safety teaches it to do so; and it soon finds that it can do so in no other way than by moderating, not only its anger, but all its other passions, to the degree which its play-fellows and companions are likely to be pleased with. It thus enters into the great school of self-command, it

136  Riccardo Bonfiglioli studies to be more and more master of itself, and begins to exercise over its own feelings a discipline which the practice of the longest life is very seldom sufficient to bring to complete perfection. (TMS, III.3.22: 145) Again, assuming the natural desire to be beloved and the attention to a human being’s own safety, not only sympathy, but also emulation has an important role in order to understand the link between natural education and moral conscience in Smith. For Smith, it is on the basis of the model of others that character and conduct are influenced (TMS, I.iii.3.2). 24 According to Smith, a human being emulates who he naturally, instinctively, admires and loves (TMS, I.iii.3.7). If a human being admires the character and the conduct of the other, this admiration brings him to desire to be like him (TMS, III.2.9). And someone admires a human being whose conduct is naturally and historically approved. A human being who wants to approve of himself must become an impartial spectator of himself, according to Smith: “the degree that is most agreeable to the impartial spectator is likewise most agreeable to the person himself” (TMS, VI.iii.53: 262). This means striving to see one’s own conduct with the eyes of the others25 and of the imaginary spectator, thanks to the faculty of imagination on which sympathy is based for Smith. 26 Hence, in Smith, the approbation of the other is what confirms our self-approbation 27 (TMS, III.2.3). In turn, this self-approbation is for Smith a virtuous motive of the human conduct (TMS, VII.ii.3.13). In this regard, Smith writes: That degree of self-estimation, therefore, which contributes most to the happiness and contentment of the person himself, seems likewise most agreeable to the impartial spectator. The man who esteems himself as he ought, and no more than he ought, seldom fails to obtain from other people all the esteem that he himself thinks due. (TMS, VI.iii.50: 261)

3 The link between natural education and happiness in Smith’s moral theory Finally, in Smith, both natural and public education, 28 with discipline and attention, are two educative moments related to the propriety of conduct and happiness: Our only anxious concern ought to be, not about the stake, but about the proper method of playing. If we placed our happiness in winning the stake, we placed it in what depended upon causes

Adam Smith on natural education and moral conscience  137 beyond our power, and out of our direction. We necessarily exposed ourselves to perpetual fear and uneasiness, and frequently to grievous and mortifying disappointments. If we placed it in playing well, in playing fairly, in playing wisely and skilfully; in the propriety of our own conduct in short; we placed it in what, by proper discipline, education, and attention, might be altogether in our own power, and under our own direction. Our happiness was perfectly secure, and beyond the reach of fortune. The event of our actions, if it was out of our power, was equally out of our concern, and we could never feel either fear or anxiety about it; nor ever suffer any grievous, or even any serious disappointment. (TMS, VII.ii.1.24: 279) It is worth underlining again how happiness depends on the propriety of the conduct, of which a human being is responsible, and not on something external to the human being. If happiness depends on something for which human beings are responsible, human beings can be happy. According to Smith, happiness is the end of the feelings moving human beings (TMS, III.5.7) and consists in the tranquility that enables enjoyment (TMS, III.3.30–31). In particular, happiness for Smith derives from the conscience of being beloved (TMS, I.ii.5.1) by others and/or by our impartial spectator (self-approbation) in relation to a moral conduct that is worthy of love. In this context, natural education is the result of the social and sympathetic experience of others at the basis of a natural self-command, since childhood; it is the first shape of that conscious and moral relationship with the self on which happiness is based. A certain way of expressing anger and fear, as children do, prevents human beings from achieving happiness (TMS, I.ii.3.7), on which moral selfhood is based. In this sense, I argue that being adult, developing morally one’s own moral character, in relation to a psychological integration (Seigel, 2005) or harmony with oneself and the others, could mean being happy (Nussbaum, 2019). In Smith, being happy depends on the right expression of passions in accord with those of others on the basis of the effort of a human being to be aware, to act in accordance with his impartial spectator within and others. 29 Natural education is the condition of possibility of this emotional growth, of the possibility to be conscious. At this level, the relationship of the child with himself is in Smith represented in terms of natural self-command, of a natural control of the expressions of passions referring to others. Education is social in Smith in so far as the human being experiences something different from what they are: it could be the experience of ourselves, of our nature, of others, of reality. Education is related to society because it is what a society needs to be preserved. Education is natural in so far as human beings are by nature motivated in relating sympathetically to something different from themselves. In Smith, this

138  Riccardo Bonfiglioli kind of social and natural education allows the human being to experience others, his own self and his nature. In this sense, there is a naturally social education at the root of the self-command, of the sense of duty (TMS, III.5.1), and of the formation of the moral conscience. For example, education of the sense of duty toward someone or something depends on natural and habitual sympathy (for example, family affection) toward that specific object (TMS, VI.ii.1.10). The conduct and the character of a human being, objects of the moral judgment in society, depend on the quality of the experience with themselves and with their natural desires. This social and natural education, founding the moral conscience, is linked with the dimension of the relationship of the sympathetic human being with their emotions, tendencies, desires and their own self in terms of moral judgment, in society. Each human being has the moral responsibility not to be a slave of their passions, becoming conscious of their desires and masters of the expression of their passions in society. The quality of this relationship with oneself, increasingly conscious, also depends on natural education. Therefore, something can deeply touch or involve a human being because this human being is predisposed to it by nature. When human beings are touched, thanks to their human nature that disposes them to this, they are motivated to interrogate and look for the meaning of the things outside and inside them in a different light. They are motivated to act and how to act depends on the moral conscience, on the natural education and on their relationship with their own emotions. Generally, education is something leading the human being to act more consciously, while an impulsive emotion is something often making the human being act arbitrarily. According to Smith, in this sense, vice is capricious (TMS, VI.ii.1.18) and virtue is regular. From a certain perspective, paradoxically, in Smith, human nature underlies an immediate and natural recognition of the other spectators that allows human beings “to be touched” and put in a position to grow and better themselves, thanks to an emotional self-education underlying the formation of the moral conscience on which human conduct, the object of the moral judgment, depends.

4 Conclusion In conclusion, according to the main literature on this topic, in Smith there are two kinds of education: one more in connection with the proper action of the bulk of mankind, the other more in connection with the moderation of the passive feelings by the wise and virtuous human being. In this essay, I focused on the link between natural education and moral conscience, a natural self-education shared by all ordinary human beings since childhood. Assuming the centrality of the natural desire to gain a merited approbation in Smith’s conception of human nature, I called “natural education” in Smith the natural consequences

Adam Smith on natural education and moral conscience  139 (self-correction, natural self-command) of the sympathetic consideration and emulation of the others and their judgments by the child. This natural education concerns: 1 the self-correction by the human being in terms of a spontaneous self-command during childhood; 2 the condition of possibility of the moral conscience. According to Smith, natural education is at the basis of the first stage of the formation of the moral conscience underlying the moral development of selfhood in relation to the moral judgment by the internal and external spectators on human conduct. With “natural education,” I refer to the natural self-command by the child on himself, depending on the sympathetic, emulative and imaginative experience by a human being of himself in the other and of the other in himself, in the shape of what gratifies the material and moral desires of human nature. On this basis, sympathetic human beings would correct themselves in order to be deservedly approved by others and by their own internal impartial spectator. The human desire for a merited approbation depends on the propriety of this conduct in relation to the moral conscience. In this sense, in Smith, happiness – the natural end of a merited approbation based on the awareness of being deservedly beloved – starts from a natural level of self-correction, in relation to others.

Notes 1 In relation to Smith, with the term “desire,” I do not mean a momentary affective response to a particular context, but a natural and permanent state capable of being gratified by human beings. 2 I underline that, in Smith, the impartial spectator refers to the moral conscience, to the imaginary and internal spectator. An impartial spectator refers to the actual and external spectator. 3 On the state of the art, see the third volume of The Adam Smith Review (Brown, 2007). 4 Smith considers different kinds of human beings: the common man, the wise man/the virtuous, the greatest ruffian (TMS, I.i.1.1). In society, there are the poor, middle-ranking and rich human beings. These figures are required to behave in different ways and custom influences their different characters (TMS, V.2.5). I abstractly focus here on the common man who is required to have simplicity, modesty, industriousness, respect for others, fortitude, work and intelligence to attract the attention, approbation and admiration of humanity (TMS, I.iii.2.5; I.iii.3.5). 5 Self-command is generally defined as the virtue that aims to control the expression of one’s passion so as to be in accordance with the emotional intensity of the other (Bee, 2018) and to conform to the approval of the imaginary spectator within. According to Hanley (2009), self-command of prudent human beings would be based on the ability to appeal to the longterm interests of nature (preservation of the species) rather than short-term ones.

140  Riccardo Bonfiglioli 6 On the relationship between natural and public education, see TMS, VI.ii.1.10. 7 See Nussbaum, 2019: 143: Smith argues that most of the salient differences among human beings are the product of habit and education. Because these influences affect the development of human powers, Smith cannot accept the Stoic idea that economic and political differences are irrelevant to true well-being. 8 In Smith, the second kind of education consists in a correction with a severe philosophy (for example, stoicism) of the feelings having the self as their object (for example, self-love). The passive feelings are the natural and impulsive feelings have the self as their object of attention and satisfaction. 9 When Smith refers to ordinary commerce, he also means an emotional exchange (TMS, I.ii.4.1–2). 10 As Hanley noted, Smith’s philosophy of living is shaped by the interest in the question of what it means to have an “excellent and praise-worthy character” (Hanley, 2019: 137). 11 Terminologically, in the early pages of the TMS, Smith uses the terms “passion,” “feeling,” “affection” and “emotion” interchangeably (see Schliesser, 2017). 12 In Smith, the same applies to faculties: “Every faculty in one man is the measure by which he judges of the like faculty in another” (TMS, I.i.3.10: 19). 13 Nevertheless, for Smith: This disposition to admire, and almost to worship, the rich and the powerful, and to despise, or, at least, to neglect persons of poor and mean condition, though necessary both to establish and to maintain the distinction of ranks and the order of society, is, at the same time, the great and most universal cause of the corruption of our moral sentiments. (TMS, I.iii.3.1: 61) 14 Also, Smith defines as natural the domestic education given by the family (TMS, VI.ii.1.10). 15 I underline that for Smith what society commonly thinks is not absolutely true or right. See the case of infanticide in relation to Plato and Aristotle (Schliesser, 2017). 16 In Smith, sympathy is a feeling of participation in any emotion of the other (TMS, I.i.1.5), an essential feature of human nature (TMS, I.i.1.1) on which moral conduct, moral judgment and, therefore, society are based (Schliesser, 2017). Finally, I underline that sympathy is natural when a human being feels unintentionally that someone is a proper and natural object of approbation and esteem (TMS, VI.ii.1.18). 17 In this context, the self is formed (see Zahavi, 2014). In this regard, Seigel writes: Despite what critics of modern selfhood have claimed, none regarded the self as independent of social relations or as wholly autonomous; on the contrary, each in one manner or another, Smith, in the most developed and elaborate fashion, saw the relational dimension as essential to the construction of stable self-existence. (Seigel, 2005: 166–7). Iunderline that, while encountering others is indispensable for (mental and moral) individuation, Smith precisely does not accord others a “moral primacy.”

Adam Smith on natural education and moral conscience  141 18 Given that “harmony and concord” between agent and spectator are connected here, we may also say that moral education consists in learning to appreciate moral beauty. 19 Again, in relation to the self, I would not say that the historical plane is necessary for the conceptual distinction of the self, since for Smith, the encounter of two savages would be enough for the self to emerge. At the same time, however, I think that such an encounter and such a possibility of distinction also allows for the development of a historical plane that, in turn, can facilitate a better definition of the self. In Smith, the self develops, and thus becomes (also conceptually) distinguishable any time two human beings meet – regardless of historical level of development. But substantial definitions and assessments of the self are obviously tied to the varying historical stages. 20 Hume has a nice image for this, he says that children have their rough edges rubbed off when they meet others. 21 In line with Seigel (2005), I underline that this process of self-formation is at once bodily, relational and reflective in Smith. 22 See Fricke: I start from Smith’s account of a child’s moral education within the circle of its family. But in that setting moral judgments repose on naïve trust in norms and rules which cannot make any justified claims to impartiality. Section II outlines how, outside the family circle, a young person interacts with peers and will be disposed to trust a critical judgment from an unconcerned spectator. But submitting to the guidance of unconcerned spectators is not always an option, so an agent tries to look at himself from an unconcerned spectator’s point of view and learns to become his own spectator and judge, thus acquiring the faculty of conscience. (Fricke, 2013: 179) 23 In associating rhetorical with ethical propriety, Cicero (1994) prescribes the cultivation of virtue through an education emphasizing self-control, moderation and civilized verbal behaviour. 24 I add that, as in Aristotle, education is strengthened by habitual conduct (TMS, I.i.4.2) or reflection (TMS, III.4.12), by exercise (TMS, III.3.36) and the other kinds of education (philosophy, cultural education). Smith writes:  “Hardships, dangers, injuries, misfortunes, are the only masters under whom we can learn the exercise of this virtue. But these are all masters to whom nobody willingly puts himself to school” (TMS, III.3.36: 153). 25 Smith also argues that the opinion of a human being on his own character depends on his own judgement concerning his past conduct (TMS, III.4.4). 26 In particular, imagination is the faculty that enables the human being to establish this sympathetic connection with the other (TMS, I.i.4.2). Therefore, it is a means of putting oneself in the other’s situation and is capable of arousing a level of emotional intensity corresponding to the level of vividness of the representation. 27 According to Smith, this self-approbation can depend on the idea of exact perfection or on the approximation to it (TMS, VI.iii.23). 28 On the relationship between natural and cultural education (public education and philosophy), see TMS, VI.ii.1.10: 222: “Domestic education is the institution of nature; public education, the contrivance of man. It is surely unnecessary to say, which is likely to be the wisest.” 29 Nevertheless, I think that, in Smith, the claim that a human being, deservedly approved by others, would correspond to the values of his society, is

142  Riccardo Bonfiglioli not valid. It is important to consider the natural and immediate sympathy of the man within, influenced but not determined by society. Furthermore, for Smith, there are values that can be approved in different societies, such as the example of the savage. Smith emphasizes the role of conscience in later editions of the TMS; also after Gilbert Elliot’s objections, according to which feelings sympathetically approved would conform to popular opinion. In this regard, see Corr., 40, and Ross, 2005: 165, 194, 199–200.

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Adam Smith on natural education and moral conscience  143 Fricke, C., 2013, “Adam Smith: The Sympathetic Process and the Origin and Function of Conscience”, in C.J. Berry, M.P. Paganelli & C. Smith (eds.), The Oxford Handbook of Adam Smith, Oxford University Press, Oxford, pp. 177–200. Griswold, C., 1999, Adam Smith and the Virtues of Enlightenment, Cambridge University Press, Cambridge. Haakonssen, K., 1981. The Science of a Legislator: The Natural Jurisprudence of David Hume and Adam Smith, Cambridge University Press, Cambridge. Hanley, R.P., 2009, Adam Smith and the Character of Virtue, Cambridge University Press, Cambridge. ———, 2019. Our Great Purpose. Adam Smith on Living a Better Life, Princeton University Press, Princeton, NJ. Heilbroner, R., 1982, “The Socialization of the Human Being in Adam Smith”, History of Political Economy, vol. 14, no. 3, pp. 427–39. Heydt, C., 2008, “A Delicate and an Accurate Pencil: Adam Smith, Description, and Philosophy as Moral Education”, History of Philosophy Quarterly, vol. 25, no. 1, pp. 57–73. Hutcheson, F., 2002, An Essay on the Nature and Conduct of the Passions and Affections, with Illustrations on the Moral Sense [1728], ed. A. Garrett, Liberty Fund, Indianapolis, IN. Mandeville, B. de, 1988, The Fable of the Bees: or, Private Vices, Publick Benefits [1714–1732], With a Commentary Critical, Historical, and Explanatory by F.B. Kaye [1924], Liberty Fund, Indianapolis, IN, 2 vols. Maurer, C., 2019, Self-love, Egoism and the Selfish Thesis: Key Debates from Eighteenth-Century British Moral Philosophy, Edinburgh University Press, Edinburgh. Nussbaum, M., 2019, The Cosmopolitan Tradition: A Noble but Flawed Idea, The Belknap Press of Harvard University Press, Cambridge, MA. Ross, I.S., 2005, The Life of Adam Smith, Oxford University Press, Oxford. Rothschild, E., 1998, “Condorcet and Adam Smith on Education and Instruction”, in A. Rorty (ed.), Philosophers on Education: New Historical Perspectives, Routledge, London, pp. 209–26. ———, 2001, Economic Sentiments: Adam Smith, Condorcet, and the Enlightenment, Harvard University Press, Cambridge, MA. Schliesser, E., 2017, Adam Smith. Systematic Philosopher and Public Thinker, Oxford University Press, Oxford. Seigel, J., 2005, The Idea of The Self. Thought and Experience in Western Europe since the Seventeenth Century, Cambridge University Press, Cambridge. Thomas, A., 2018, “Adam Smith on the Philosophy and Provision of Education”, Journal of Interdisciplinary Economics, vol. 30, no. 1, pp. 105–16. ———, 2019, “Adam Smith on Wages and Education: Some Policy Implications for India”, Indian Journal of Human Development, vol. 13, no. 1, pp. 84–9. Weinstein, J., 2007, “Introduction: Adam Smith’s Philosophy of Education”, The Adam Smith Review, vol. 3, pp. 51–74. ———, 2013, Adam Smith’s Pluralism: Rationality, Education and the Moral Sentiments, Yale University Press, New Haven, CT. Zahavi, D., 2014, Self and Other, Exploring Subjectivity, Empathy, and Shame, Oxford University Press, Oxford.

Ethics and economics

9 Adam Smith and a theory of just efficiency María Alejandra Carrasco and Maria Pia Paganelli

1 Introduction Adam Smith (1723–1790) is often considered the father of economics, and as such is seen as presenting economic theories that resemble theories economists use today. This is true, to some extent. But it can be misleading in other ways. A common characteristic often attributed to economics is that efficiency may come at the cost of fairness. So that there is a trade-off between efficiency and fairness. We show instead that for Adam Smith, this trade-off does not exist, and to the contrary, fairness comes with efficiency, and vice-versa, unfairness comes with inefficiency. In this chapter, we will show this relationship, but we will also explore whether it always happens, how it happens, and what are the reasons why it does so. Fairness is a difficult term to define, and it may be peculiar to the English language (Smith & Wilson, 2019). We can think of it as something relating to playing according to the rules of the game. These rules of the game can be thought of as applying equally to everyone. So that those rules would not cause harm. In The Theory of Moral Sentiments (TMS), Smith indeed tells us that: In the race for wealth, and honours, and preferments, [a person] may run as hard as he can, and strain every nerve and every muscle, in order to outstrip all his competitors. But if he should justle, or throw down any of them, the indulgence of the spectators is entirely at an end. It is a violation of fair play, which they cannot admit of. This man is to them, in every respect, as good as he: they do not enter into that self-love by which he prefers himself so much to this other, and cannot go along with the motive from which he hurt him. They readily, therefore, sympathize with the natural resentment of the injured, and the offender becomes the object of their hatred and indignation. (TMS, II.ii.2.1: 83)

DOI: 10.4324/9781003301448-12

148  María Alejandra Carrasco and Maria Pia Paganelli The deserved indignation generated from the injury and the resentment the injury creates are at the base of the Smithian idea of justice (Paganelli & Simon, 2022). And justice should be the base of all policies, as Smith reminds his readers in The Wealth of Nations (WN): To hurt in any degree the interest of any one order of citizens, for no other purpose but to promote that of some other, is evidently contrary to that justice and equality of treatment which the sovereign owes to all […] his subjects. (WN, IV.viii.30: 654) We argue that these fair rules that apply equally to everyone are a reason why opulence can be achieved. Indeed, for Smith, a tolerable administration of justice can unleash the power of economic growth (Life, IV.13: 315). Our natural passions are able to drive us to opulence, if the path of justice is kept open. That security which the laws in Great Britain give to every man that he shall enjoy the fruits of his own labour, is alone sufficient to make any country flourish, notwithstanding these [corn laws] and twenty other absurd regulations of commerce […]. The natural effort of every individual to better his own condition, when suffered to exert itself with freedom and security, is so powerful a principle, that it is alone, and without any assistance, not only capable of carrying on the society to wealth and prosperity, but of surmounting a hundred impertinent obstructions with which the folly of human laws too often incumbers its operations; though the effect of these obstructions is always more or less either to encroach upon its freedom, or to diminish its security. (WN, IV.v.b.43: 540) But when the laws are such that some gain at the expense of others, then we will experience all sorts of deterrence that slow down, if not even block, economic growth. Mercantilist laws are presented as laws that favor a group at the expense of society, and they are condemned as both unjust and inefficient (Paganelli, 2023). One of the reasons why for Smith we should care about economic growth is that, with prosperity, we are able to live better lives, to have higher standards of living, and, as a consequence, even potentially develop more fully at the moral level.

2  Material prosperity and “social enjoyments” Let us start from this last point. A very poor society is an environment with many hard constraints for our lives. We face constant threats and

Adam Smith and a theory of just efficiency  149 our survival is in question all the time. We face scarcity of food, precarious shelter, we may not be properly clothed, and may encounter ferocious animals or human enemies intending to kill us (WN, intro. & plan.4: 10). Under these conditions, we develop a strong self-command, meaning, we learn how to control the expression of our passions so that we do not express them (TMS, V.2.9: 205). In Smith’s moral theory, self-command is the virtue with which we learn to moderate our emotions in such a way as to express what we know others will approve of. It “is not only itself a great virtue, but from it all the other virtues seem to derive their principal lustre” (TMS, VI.iii.11: 241). Like all habits, it is trained and internalized – in “the great school of self-command” (TMS, III.3.22: 145) – so that, although at first it is necessary to repress the affects, they finish by being educated or modulated so that in the end we truly “feel” as it is appropriate for the context, or as an impartial spectator would approve of. Therefore, in a very harsh environment in which any expression of our passions is perceived as a sign of our weakness and will not generate any approbation from others, we simply do not express our feelings. After all, Smith tells us, in extreme environments, there is little point in feeling sorry for you if you are starving to death, because I am also starving to death. Any attempt to help you, due to my sorrow at your expression of pain, would jeopardize my life, so I would disapprove and ignore your pain, should it be visible. You know it. So you do not show any (Bee & Paganelli, 2019). We thus train ourselves not to express any emotions, when we live in such conditions where our lives are constantly under threat. So much so that even a small expression of affection toward a spouse is frowned upon (TMS, V.2.9: 205). How else could one adapt to live in an environment in which one is forced, or thinks to be forced, to abandon their infants, sick, and elderly to be “devoured by wild beasts,” or exposed to the elements until death take them? (WN, intro. & plan.4: 10; TMS, V.2.15: 210) Or in an environment in which a mother would give birth to twenty children to see only two grow up to maturity? (WN, I.viii.37: 96) Or where newborns are drowned like unwanted puppies because there are no means to support them? (WN, I.viii.24: 90) Extreme poverty (or constant exposure to death, like a war) creates the conditions under which we can and do develop a very strong self-command – meaning, in this case, impassivity, stoic apathy, the absolute non-expression of feelings. In such situations, the virtue of humanity must take a back seat. Smith tells us that men of the most perfect self-command, whom no difficulties can discourage, no danger appal, and who are at all times ready for the most daring and desperate enterprises, but who, at the same time, seems to be hardened against all sense either of justice or humanity. (TMS, III.3.37: 153)

150  María Alejandra Carrasco and Maria Pia Paganelli For Smith, humanity is the virtue of sharing our feelings with others, “the exquisite fellow-feeling which the spectator entertains with the sentiments of the persons principally concerned, so as to grieve for their sufferings, to resent their injuries, and to rejoice as their good fortune” (TMS, IV.2.10: 190–1), which implies expressing our feeling in the appropriate pitch so that we can share our passions with others. Humanity, for Smith, is thus the counter of repressing all expressions of emotions. Of course, we always need self-command, as we need to adjust the pitch of our passions to a level that is deemed appropriate in a particular situation1. So under severe poverty, self-command tilts all the way to no expression of any emotion, where humanity becomes impossible. While under different circumstances, the virtue of self-command will give space to the appropriate expression of emotions so we can share how we feel with others, and thus also give space to the virtue of humanity. The conditions under which humanity can prevail, for Smith, are where we are not constantly worried about our survival, but instead enjoy the “mild sunshine of undisturbed tranquility” (TMS, III.3.37: 153). Which means when a society is safe enough to eliminate the threat of death due to lack of resources, arbitrary laws, oppression or other dangers, people become more humane. In this sense, wealth is one of the conditions for people to feel safe and comfortable. And the more comfortable people are, the more humanity will be present. It is not an accident, according to Smith, that in the most commercial (read, opulent) societies in his time, a general can openly cry at court for not receiving the command of some group of soldiers, or that one would openly express more emotion for receiving a small fine, when in a less commercial society, one would not dare to cry even if receiving a death sentence (TMS, V.2.10: 207). The importance of the presence of humanity for human flourishing is that humanity allows us to exchange our passions, to exchange our sentiments. And by doing so, we can more easily develop bonds of friendship, which according to Smith are “the best and most comfortable of all social enjoyments” (TMS, VI.iii.15: 243; see also Bee, 2021). After all, for Smith, one of our deepest inner drives is our desire to be lovely and thus (properly) loved (TMS, III.2.1: 113). And it is much easier to be lovely and loved if we can express our emotions than if we cannot. Le bon David, David Hume, was loved by all his many friends, and he had no hesitation to show his loveliness, as all his friends testified. And it may not be an accident that Smith describes him as the most virtuous person the world had ever seen. Hume, in a sense, embedded the spirit of commercial society and opulence (Paganelli, 2021). How do we get that opulence that, along with other conditions, generates the tranquility necessary to develop the virtue of humanity, then? Here again, Smith is quite open about the answer. Opulence comes from the division of labor (WN, I.i: 13–24), which in its turn depends on the

Adam Smith and a theory of just efficiency  151 extent of the market (WN, I.iii.1: 31). So commerce is what brings us wealth and the tranquility needed for the virtue of humanity.

3  Commercial society and justice So far, we have seen that Smith establishes the relationship between commercial society, opulence, tranquility, and the virtue of humanity. A commercial society is a society whose people live mostly on commerce. Exchanges and some commercial activities have always been present, of course, but not always as the main way for most people to achieve their means of subsistence. In fact, in an agricultural society, people rely mostly on agriculture to live, and in a hunting society mostly on hunting, or in a shepherd society mostly on pastoral means of making a living. The advent of commercial societies may or may not be accidental (Paganelli, 2023) or providential (Viner, 1977) or historically materialistic (Meek, 1976), but it does depend on the presence of a tolerable administration of justice (Irwin, 2019). When people are let free to enjoy the fruits of their labor, people will work hard, be inventive, accumulate capital, and promote economic growth and prosperity for all. On the other hand, when this freedom of enjoying the fruits of one’s labor is impaired (due to insecurity in the face of crime, the arbitrariness of the norms, or abuse of authority), people will lose motivation to work, to invent new ways of production, and thus economic growth slows or stops completely. Smith gives the example of China, according to him, the richest country on earth at his time. But China has not grown since the time of Marco Polo, and faces some severe pockets of poverty (WN, I.viii.24: 89). Why? Because the mandarins abuse their power, rather than administer it fairly. The middling people have no incentives to produce more than needed, because if they do, all the extra would be taken from them (WN, I.ix.15: 112). These abusive practices not only are inefficient, as they deter economic growth causing devastating poverty for the very poor, but also, first and foremost, extremely unjust. It is indeed in China where we find the practices, looked upon with horror by rich Europeans, of drowning infants like puppies (WN, I.viii.24: 90). Even worse, Smith tells us, the scandalous unfair and unjust practices of the joint stock companies in the East Indian colonies are devastating for the local economies. Not only does it halt economic growth, it causes a severe contraction of the economy. The rapacity of the merchants and manufacturers, combined with the perverse incentive structures of a company that can act like a sovereign even if it is not a sovereign, causes the death from starvation of hundreds of thousands in one of the most fertile lands in the world (WN, I.viii.26: 91; WN, IV.vii.c.102–106: 637–40). There is no trade-off between efficiency and justice in Bengal. Injustice creates inefficiency. Injustice and inefficiency go in the same

152  María Alejandra Carrasco and Maria Pia Paganelli direction, compounding each other, making an already bad situation worst. Slavery is not different. Slavery implies the dehumanization of the enslaved person so that their owner can force them to work without any compensation, which Smith considers as one of the worst violations of “just liberty.” Indeed: The property which every man has in his own labour, as it is the original foundation of all other property, so it is the most sacred and inviolable. The patrimony of a poor man lies in the strength and dexterity if his hands; and to hinder him from employing this strength and dexterity in what manner he thinks proper without injury to his neighbour, is a plain violation of this most sacred property. It is a manifest encroachment upon the just liberty […]. (WN, I.x.c.12: 138) Enslaved labor is, according to Smith, the most inefficient and expensive labor. An enslaved person has no incentive to work more than strictly necessary to stay alive, while eating as much as possible (WN, III.ii.9: 387). For Smith, this is the reason why enslaved labor is found only in extremely profitable activities. Only in those businesses, such as sugar and tobacco, one can afford to waste so much on labor (WN, III.ii.10: 389). On the other hand, when one pays workers liberally and proportionally to their output, they work so hard to even get themselves sick from overwork (WN, I.viii.44: 99–100). Injustice generates inefficiencies. On the other hand, fairness generates efficiency. It is indeed difficult to find policies in Smith’s account that, even if unjust, generate an efficient result. Just like it is difficult to find in Smith fair policies that are not linked to promoting prosperity. Think, for example, about primogeniture. In Smith’s time, primogeniture is an unfair policy as it privileges the first born over all other children for no other reason than being the first born: “nothing can be more contrary to the real interest of a numerous family, than a right which, in order to enrich one, beggars all the rest of the children” (WN, III.ii.4: 384). Primogeniture is seen as the cause of monopoly of land, which discourages and prevents innovation. Large landlords care only about ornaments, not about productivity (WN, III.ii.7–8: 385–7). After all, they are not the ones cultivating the land. They just extract rent from it and their idea of improvement is simply more of the same. On the other hand, in the North American colonies, land is not subjected to primogeniture and there the economy expands at an incredible rate. Land can be bought and sold at will, by anyone, which allows anyone to be able to buy some. So any worker eventually will be able to buy their plot of land.

Adam Smith and a theory of just efficiency  153 Productivity increases. And to boot, the ability of workers to buy land implies that there is always a high demand for labor. This implies that masters cannot successfully conspire to keep workers’ wages low. To the contrary, they need to keep increasing wages to attract workers (WN, III.iv.19: 422–4). This spurs economic growth further. The positive effect of this fair policy of land allocation is witnessed by how fast a widow with several children remarries in the colonies. She would never be able to remarry in Britain, because her children would be considered a burden, not an asset. For Smith, it is not accidental that population doubles every 25 years in the North American colonies and every 500 years in Britain (WN, I.viii.23: 87–8; see also Levy, 1978; Levy, 1999). Furthermore, the non-enslaved population of the North American colonies feels equal before the law (WN, IV.vii.b.51: 584–5). The equality of treatment that the sovereign is called for to maintain in front of the law, is the condition for commercial exchange to operate. Smith indeed, in the opening of WN, describes three alternative ways of obtaining dinner. We can frown like dogs, we can beg like beggars, or we can appeal to the self-interest of the butcher, brewer, and baker (WN, I.ii.2: 26). The first two methods imply a hierarchical structure of dependency, in which the dignity of a party is diminished if not eliminated completely. These are also precarious, or inefficient, ways of getting dinner as they are dependent on our ability to please our master or on the benevolence of others. Buying our dinner from the butcher, brewer, and baker, on the other hand, puts us on the same level as them. Our self-interest is just as important as theirs, and I can convince them through a reasoned conversation among peers to give me what I want as I would give them what they want. A fair treatment of all human beings is the efficient way to obtain our dinner. Smith reiterates this point even later in the WN, even if in different terms. Smith describes the advent of commercial societies in Europe as a transition from a state of “servile dependency” to a state of equality and freedom (WN, III.iv.4: 412). In pre-commercial societies, indeed, a master would have many people as his dependents. And these dependents would have only their masters as a source of protection and survival. This is a very precarious situation for the dependents, which are like slaves, because their master has basically complete power over them. Pre-commercial societies are not prosperous societies. But with the advent of commerce, these dependents are able to break the ties with their master. Now they may have a thousand masters, Smith said, as they now depend on a thousand different customers. But this implies independence from each one of them (WN, III.iv.11: 419–20). This increases their freedom, their fair treatment, and prosperity in society. This independence is both fair and efficient.

154  María Alejandra Carrasco and Maria Pia Paganelli

4  Justice, efficiency, and a good life In Section 2, we saw that for Smith, a safe and prosperous society provides the conditions to develop the virtue of humanity, which fosters personal relationships and strengthens social bonds. Since friendship (social concord, mutual approbation) is one of the strongest desires of our nature, the virtue of humanity makes people’s lives more fulfilled and more comfortable. A society that is safe and fair is also a society where prosperity can flourish, as there are the right incentives to increase wealth. Fairness and efficiency thus seem to go hand in hand, reinforcing each other, rather than being in opposition to each other. Then, in Section 3, we showed that for Smith, prosperity and efficiency depend on the justice of laws, as commercial societies manifest, and that unjust institutions generally end up being inefficient. We thus agree with James Buchanan who, for the 200th anniversary of the publication of The Wealth of Nations, affirmed that Smith cared predominantly for a society that is just, and that it happens to be efficient. Justice is what matters, and it can matter without the fear of losing efficiency. Indeed, the lesson we can learn from Smith today is that promoting just and fair policies is a way to promote efficiency (Buchanan, 1978). Moreover, to this justice–efficiency relationship, we added a third element creating the trinomial justice–efficiency–humanity. We argued that just and efficient policies foster the development of the virtue of humanity, which, in turn, enables people to enjoy a better life. In these last sections, we will go one step further, showing that the relationship between justice, efficiency, and a better life is not accidental, but can be explained in light of the same innate tendencies of human nature that Smith highlighted along his work.

5 Institutions Smith says: The characters of men, as well as the contrivances of art, or the institutions of civil government, may be fitted either to promote or to disturb happiness both of the individual and of the society. (TMS, IV.2.1: 187) In other words, some institutions are suitable for their context and others are not, and the criterion for discerning between them is whether they promote a better life (Schliesser, 2017: 191). Naturally, this is an ex-post criterion. However, Smith’s description of successful and unsuccessful institutions helps to understand the difference between them and why some are appropriate, more efficient, and will probably be successful in the long run.

Adam Smith and a theory of just efficiency  155 For Smith, institutions that foster social development are those in which our natural principles (or innate human dispositions), social factors, and deliberate decisions interact. It is from this combination of nature and nurture that the rules of cooperation by which individuals regulate their conduct (i.e. institutions) emerge, and they are then selected according to their efficacy to satisfy the interests of those concerned (Otteson, 2011: 83). Practice comes first. The recognition and formalization of these coordinated practices come later to ratify a fact that is “naturally” given (natural dispositions plus some intervention of the human will). According to Smith, one of our strongest tendencies is the desire for mutual sympathy, to feel approved of by others (TMS, I.i.2.1: 13; VI.1.3: 213). The search for sympathy is the search for concord, which is the natural bond of communities and toward which nature pushes us (TMS, I.i.4.7: 22). However, together with this tendency, we also have a strong drive to self-preference, to overestimate our interests to the detriment of those of others (TMS, III.3.2–4: 135–7). This is the reason why when we live in society, despite our need for each other, we are also exposed to mutual injuries (TMS, II.ii.3.1: 85). The solution, in Smith’s theory, comes from self-command, the virtue we have already described. This virtue restrains and redirects our passions by habituating us to act as an impartial spectator would approve, as “[t]he most vulgar education teaches us” (TMS, III.3.7: 139). We humble the arrogance that makes us feel more than others and we achieve concord – the affective bond necessary for peaceful social cohesion. However, to safeguard this bond from breaking, we require certain institutions (TMS, II.ii.2.2: 83–4). These institutions, which articulate sympathy and self-love to preserve society, are positive laws and the administration of justice.

6  General rules, positive laws, and justice General rules are necessary because we all, due to the influence of our selfish passions and/or lack of information, can misjudge the situations in which we live. “This self-deceit – says Smith –, this fatal weakness of mankind, is the source of half the disorders of human life” (TMS, III.4.6: 158). The remedy, once more, comes from a combination of nature and nurture: the general rules we insensibly form, collecting the experience of innumerable judgments and which, as such, warrant more practical wisdom. “Without this sacred regard to general rules, there is no man whose conduct can be much depended upon” (TMS, III.5.2: 163), says Smith, because we are all morally and epistemically limited and require the concurrence of several perspectives to judge with impartiality. This is why general rules, which apply equally to everyone (fair play), may both safeguard social concord and make us mutually trustable.

156  María Alejandra Carrasco and Maria Pia Paganelli The most important rules for social life are the laws of justice: “the real protagonist in Smithian system of Jurisprudence [and] the main task of every constitutional and legal order” (Simon, 2013: 400). In the TMS, Smith describes that when faced with a situation where someone is positively hurt for improper motives, spectators sympathize with the victim’s resentment and feel, like her, the desire to punish the aggressor. Nature, antecedent to all reflection upon the utility of punishment, has in this manner stamped upon the human heart […] an immediate and instinctive approbation of the sacred and necessary law of retaliation. (TMS, II.i.2.5: 71) The institution of justice arises from this natural passion regulated by the judgment of the impartial spectator, which is later formalized in the laws. Therefore, as they make explicit that there is no proper motive for harming one’s neighbor, the institution of justice warrants the defense of the innocent and equal respect for everybody. In the race of life (“wealth, honours, preferments”), as we have already said, we must see ourselves in the light in which others see us: one in a multitude of equals. Commercial societies may foster and reinforce this equality as they give us more opportunities to interact with strangers. Interacting with strangers, according to Smith, allows us to see ourselves through different glasses, from different points of view, thus facilitating our understanding that we are just one in a multitude (TMS, III.3.4: 137). The realization that we are not the center of the universe humbles us and allows us to tone down the pitch of our passions to a level that is more acceptable to others (TMS, I.i.5.8: 25–6; I.ii.intro.1: 27), thus fostering our moral development (Paganelli, 2017). In the political sphere, “[t]he wisdom of every state or commonwealth endeavours […] to employ the force of the society to restrain those who are subject to its authority, from hurting or disturbing the happiness of one another” (TMS, VI.ii.intro.2: 218), and does so through general rules. Smith highlights the asymmetry between rules of justice and those of other virtues, for only the former are “precise, accurate, and indispensable” (TMS, III.6.11: 175). This is necessary because, as justice is “the main pillar that upholds the whole edifice [of society]” (TMS, II.ii.3.4: 86), the state must enforce it. Compliance with the rules of justice is the obligatory minimum for preserving society, guaranteeing equal respect for all. These laws are considered “sacred” (TMS, II.ii.2.3: 84) and inviolable because the interests they protect are sacred, which ultimately means that persons are sacred and inviolable: “The rules of justice define the dignity of the individual person in the sense that they render specific our status as beings who may not be treated in a certain ways” (Darwall, 1999: 156; see also Fleischacker, 2021: 117). Moreover, laws of justice also and simultaneously leave open a wide space for each person to freely develop according to her own judgment.

Adam Smith and a theory of just efficiency  157 In sum, when the institutions that govern society proceed from our natural tendencies, each person is valued on her own (not as part of a whole), so we can all be sure that the whole society will react if someone tries to denigrate another by not treating her as an equal. On the other hand, as long as we do not improperly harm others, we are also sure that our freedom to autonomously decide one’s own life will be respected. Justice, understood as Smith does, entails security, equality, and freedom. It thus offers a fertile ground on which to grow prosperous. Justice again goes hand in hand with efficiency, not against it.

7  Justice and efficiency The best institutions to organize society are those that arise from innate tendencies mediated by the impartial spectator (“reason, principle, conscience, […] the great judge and arbiter of our conduct” [TMS, III.3.4: 137]), who determines the most appropriate in each situation, collecting repeated processes of adjustment of feelings among all members of society. The reason is plain. The “bottom-up” justification legitimates the authority of these institutions. They are not imposed by an enlightened mind (a “man of system”) but arise from our own experience. Moreover, since nobody voluntarily injures herself, the concurrence of all society in their origin warrants respect for the equality and freedom of all. Consequently, the institutions of the “system of natural liberty,” especially the administration of justice and general laws, enable people to feel secure and confident to invest all their energy in their own life projects. As in the political realm, the economic institutions proposed by Smith also arise from our natural dispositions. In this sphere, he identifies the tendency to better one’s condition (which accompanies us from womb to the grave [WN, II.iii.28: 341; TMS, I.iii.2.1: 50]) and the “propensity to truck, barter, and exchange one thing for another” (WN, I.ii.1: 25). 2 When these innate drives are deployed where justice prevails (i.e. security, respect for equality, and freedom), a prosperous society arises.

8 Conclusion Contrary to what is often thought, for Adam Smith, there is no tradeoff between efficiency and justice. As James Buchanan noted, for Smith, justice is what matters, and justice happens to be efficient. Whenever justice (hence security, equality, and liberty) is warranted, society flourishes. Where there is justice, industry is kept in permanent motion (TMS, IV.1.10: 183), benefiting the whole of society. It is the great multiplication of the productions of all the different arts, in consequence of the division of labour, which occasions, in a

158  María Alejandra Carrasco and Maria Pia Paganelli well-governed society, that universal opulence which extends itself to the lowest ranks of people. (WN, I.i.10: 22; see also TMS, IV.1.10: 184) For Adam Smith, an economic order that is primarily just, has rules that govern relations between people, which are fair, and that respect the freedom and equality of people, which are the base of human and economic flourishing. Pre-commercial societies, due to their poverty, tend to generate potentially de-humanizing “servile dependency.” Their poverty threatens both human dignity and economic growth. Commercial societies on the other hand are based on economic exchanges, which intrinsically recognize equal dignity and freedom among individuals, and tend to generate prosperity. Smith, indeed, condemns policies that retard economic growth because they fail to promote equality by benefiting some at the expense of others. They are unjust and also inefficient. He praises policies that promote economic growth because they also promote the equality and freedom of all. They are fair and also efficient. Furthermore, and in the same way that justice fosters efficiency, which ultimately results in greater prosperity, a safe and prosperous society generates the conditions for developing the virtue of humanity. This completes the trinomial (justice–efficiency–humanity) that, in Smith’s theory, is based on the natural tendencies of the human being. The security and comfort of a just and prosperous society allows people to dare to express their feelings, generates more opportunities for sympathetic interaction, strengthens social bonds, and promotes friendship between people. All this contributes to a better life. Naturally, this is not an automatic or infallible sequence. Social processes are multi-causal and full of exceptions and setbacks. Human beings are not chess pieces without their own principle of motion. Smith’s suggestion is that justice is what matters the most. It is the cornerstone that must always be protected because it sustains the whole structure of society. Yet it is not the only stone needed for a good constitution. However, understanding why justice promotes efficiency, and why security and prosperity foster the development of the virtue of humanity, is an important reason for never compromising respect for justice.

Notes 1 Some confusion may arise because Smith uses the term “self-command” with two different meanings. One is the virtue that underlies and gives luster to all the other virtues since it refers to the proper control and direction of affections according to different circumstances. In this sense, the virtue of humanity also requires self-command, since it requires an appropriate expression of affections. The other meaning is the non-manifestation of any

Adam Smith and a theory of just efficiency  159 affection, and, in this sense, it is the opposite of humanity (see Montes, 2016: 147–50). 2 Otteson (2011: 93) adds “self-interest” as the third principle of human nature with an important role in this sphere. We naturally agree with him, although here we conflated it with the desire to better our condition.

References Bee, M., 2021, “The Pleasure of Exchange: Adam Smith’s Third Kind of Self-Love”, Journal of the History of Economic Thought, vol. 43, no. 1, pp. 118–40. Bee, M. & M.P. Paganelli, 2019, “Adam Smith Anti-Stoic”, History of European Ideas, vol. 45, no. 4, pp. 572–84. Buchanan, J.M., 1978, “The Justice of Natural Liberty”, in F.R. Glahe (ed.), Adam Smith and the Wealth of Nations: 1776–1976 Bicentennial Essays, Colorado Associated University Press, Boulder, CO, pp. 61–81. Darwall, S., 1999, “Sympathetic Liberalism: Recent Work on Adam Smith”, Philosophy and Public Affairs, vol. 28, no. 2, pp. 139–64. Fleischacker, S., 2021, Adam Smith, Routledge, New York. Irwin, D.A., 2019, “Adam Smith’s ‘Tolerable Administration of Justice’ and the Wealth of Nations”, Scottish Journal of Political Economy, vol. 67, no. 3, pp. 231–47. Levy, D., 1978, “Some Normative Aspects of the Malthusian Controversy”, History of Political Economy, vol. 10, no. 2, pp. 271–85. ———, 1999, “Malthusianism or Christianity: The Invisibility of Successful Radicalism”, Historical Reflections/Réflexions Historiques, vol. 25, no. 1, pp. 61–93. Meek, R.L., 1976, Social Science and the Ignoble Savage, Cambridge University Press, Cambridge – New York. Montes, L., 2016, “Adam Smith: Self-interest and the Virtues”, in R.P. Hanley (ed.), Adam Smith: His Life, Thought, and Legacy, Princeton University Press, Princeton, NJ, pp. 138–56. Otteson, J., 2011, Adam Smith, The Continuum International Publishing Group, New York. Paganelli, M.P., 2017, “We Are Not the Center of the Universe: The Role of Astronomy in the Moral Defense of Commerce in Adam Smith”, History of Political Economy, vol. 49, no. 3, pp. 451–68. ———, 2021, “Adam Smith and Dying Peacefully”, in E.A. Dolgoy, K.H. Hale & B. Peabody (eds.), Political Theory of Death and Dying, Routledge, New York, pp. 292–8. ———, 2023, “Adam Smith and the Morality of Political Economy”, manuscript, in Paul Sagar (ed.), Interpreting Adam Smith: Critical Essays, Cambridge University Press, Cambridge. Paganelli, M.P. & F. Simon, 2022, “Crime and Punishment: Adam Smith’s Theory of Sentimental Law and Economics”, Journal of the History of Economic Thought, vol. 44, no. 1, pp. 95–104. Schliesser, E., 2017, Adam Smith. Systematic Philosopher and Public Thinker, Oxford University Press, New York.

160  María Alejandra Carrasco and Maria Pia Paganelli Simon, F., 2013, “Adam Smith and the Law”, in C.J. Berry, M.P. Paganelli & C. Smith (eds.), The Oxford Handbook of Adam Smith, Oxford University Press, Oxford, pp. 393–416. Smith, V.L. & B.J. Wilson, 2019, Humanomics: Moral Sentiments and Wealth of Nations for the Twenty-First Century, Cambridge University Press, New York. Viner, J., 1977, The Role of Providence in the Social Order: An Essay in Intellectual History, Princeton University Press, Princeton, NJ.

10 The ego-alter-tertius paradigm Adam Smith’s interaction model Eleonore Kalisch 1  Ethics and economy between community and society Adam Smith contributed considerably to spiritually culturally shaping the new society of possessive individualism that was established in Britain in the 17th and 18th centuries (see Macpherson, 1989). Ferdinand Tönnies identified this process as a starting point for the sociological distinction between community and society. Community is rooted in family and gentilic blood ties, in ethnic commonalities, in local ties and personal relations that could extend concentrically, from the municipality via the city state as far as to the territorial state. Society on the other hand centres around the market; all personal ties are reshaped by material goods–money relations. Society disengages from traditional family and tribal ties, from agricultural down-to-earthness, and creates a social cosmos of cosmopolitan urbanity. For his definition of the concept of society, Tönnies explicitly referred to Smith: A general picture now emerges of what may be called “Civil Society” or Society based on general commercial exchange. It is the task of political economy to understand the nature and dynamics of a situation in which, to use Adam Smith’s expression, “everyone is a merchant.” The situation is one in which individual entrepreneurs, and businesses in the form of firms and companies, deal with one another in the national or international markets and stock exchanges. This is where the inner essence of Gesellschaft is epitomised, or thrown into relief as in a concave mirror. (Tönnies, 2012: 63–4) However, community is preserved in the context of market-centred society, as far as it can be communicated by the new kinds of market economy, of commercial society and constitutional statehood. There develop smaller and bigger, locally tied and cross-border ways of communal relations and activities, in the context of which community redefines itself: as a community of professions and interests, which is close to commercial society, and as a community of values – of religious and cultural

DOI: 10.4324/9781003301448-13

162  Eleonore Kalisch communities as far as to cosmopolitan associations and secret societies, from the clubs as far as to the Free Masons. Adam Smith tried to not tear community and society apart but to reconcile both, without disregarding their respective specifications. This way, he provided the new bourgeois-capitalist society with its internal kinds of community with both ethics and a national economy. He takes possessive individualism into consideration while at the same time criticising its excesses. In modern society, the property taboo is nothing old. Only Locke had succeeded – against the state’s capacity of confiscating private property in times of need and emergency – with enforcing the protection of private property: one precondition for the accumulation of capital and for private investment. Locke provided the crucial arguments: he no longer grounded the right to property on occupation but on labour.

2 Invisible hand without Jupiter: the auto-regulation of the market By the metaphor of the invisible hand, Smith refers to the never undisturbed balancing tendency of market economy. This becomes obvious from overcoming the scarcity of goods due to the progress of the division of labour, by the balancing of industrial mass production and the increase in purchasing power, from the relation of supply and demand, from the disproportionate support of machine tool building and the production of consumer goods. The invisible hand refers to balanced growth, confronted by the imbalance during growth: from cyclical fluctuation and crises as phases of the economic cycle, as far as to the long waves of disruptive innovations, which, as the driving forces of the development of productive force, provide their protagonists with headstart profits compared with their competitors. The invisible hand becomes an ideal that cannot be met if balanced growth is being absolutised and the imbalances between saving and investing, if the distribution battles between capital and labour as well as the pendular movements between a failing market and a failing state are ignored. After all, invisible-hand effects refer to the autonomisation of the economy by way of the self-regulation of the market in the context of the division of labour-based differentiation of society into relatively autonomous functional systems. How far can the invisible-hand model of the self-regulated market economy be generalised? Points of contact are to be found with Marx’s theory of commodity fetishism, which is realised by the contradiction of latency and evidence. Evident are the movements of the market in the field of circulation, by commodities appearing as quasi-subjects; latent are the social relationship networks among those market actors who are behind the circulation of goods. The entire production cycle presents itself as a complex overall process happening behind the actors’ backs. Such a

Adam Smith’s interaction model  163 behind-the-actor’s-back effect, which covers the trans-intentional overall and far-distance effects of intended market behaviour, is in a way in line with the invisible-hand explanation – only with the difference that in Marx, the harmonisation tendency is missing, which, in Smith, comes into the picture subliminally. Today, behind-the-actor’s-back effects are considered a proven heuristic method for a variety of topical fields. However, can the invisible-hand explanation be applied even to ethics, as Smith at least hints at? Paradoxically, Smith introduced the invisible-hand explanation into ethics even before applying it, in a particular way, to economy. The ethical interpretation is indeed the first nonteleological version of the hand metaphor that Smith had employed once before – however interpreted teleologically – as Jupiter’s hand. Later, he no longer employed teleology, with the exception of reminiscences (reference to providence in the Stoic sense), which can also be identified in The Theory of Moral Sentiments (TMS). In TMS, Smith justifies the rich landlords with their natural selfishness and rapacity: though the sole end which they propose from the labours of all the thousands whom they employ, be the gratification of their own vain and insatiable desires, they divide with the poor the produce of all their improvements. They are led by an invisible hand to make nearly the same distribution of the necessaries of life, which would have been made, had the earth been divided into equal portions among all its inhabitants, and thus without intending it, without knowing it, advance the interest of the society, and afford means to the multiplication of the species. (TMS, IV.1.10: 184–5) We might feel enticed to call Smith’s argument cynical. However, we may as well understand it to be close to what Schumpeter called “creative destruction.” Smith never absolutised the invisible-hand model. He did not draft any kind of socio-economic systems theory avant la lettre but exclusively provided a structure-centred explanation of modern market society. Thus, there is no need to ask him: What about the actors? In present times, this question has often been ignored in favour of systems–theoretical structural explanations. This has even worked in favour of conspiracytheoretical counter-drafts that claim to have once again made the question about the actors the focus of attention. From the point of view of conspiracy theories, it is about those secret actors who are supposed to be responsible for everything. These actors, located in the tradition of the secret societies, must be brought to light and be held accountable. Whereas invisible-hand apologists ask about the structures behind the actors’ backs, conspiracy theorists ask about the actors behind the structures, however, in obscure and misleading ways. On the other hand,

164  Eleonore Kalisch conspiracy-theoretical figures of thought are used to prevent the search for those who are evidently responsible for undesirable developments. For example, it is a killer argument if even the question of the role of the ruling classes (upper classes, power elites, etc.) is discredited as a conspiracy-theoretical question. In contrast, invisible-hand explanations remain indispensable for analysing the structural preconditions for societal processes.

3  The roots of Adam Smith’s ethics The ethical values Adam Smith felt obliged to are custom-made partly for market society, partly for those forms of community that – at least at first sight – are not subject to market regulations. Smith pursues a concept of natural inclinations, without following the Scottish moral philosophy and its doctrine of moral sense. Natural inclinations as Smith understands them are feelings of sympathy, feelings of avenge, self-love, to give just the three most important ones. Those emotions as being attributed to the individual are – in view of social interaction – considered moral feelings and are divided into social and unsocial passions. Social passions are elements of the individual’s understanding of him/herself and, at the same time, dispositions for social assertiveness. Furthermore, they function as motivations when dealing with others. Smith coins a principle that resembles the ancient Roman do ut des formula: “As every man doth, so shall it be done to him, and retaliation seems to be the great law which is dictated to us by Nature” (TMS, II.ii.1.10: 82). We may fathom out the civilisation-historical references even more deeply and go back as far as to the Golden Rule. However, it is close to being impertinent when today the term Golden Rule is applied to the marginal productivity of capital (van Suntum, 2001: 139). Also, by the gamestrategic formula of “tit for tat” (see Axelrod, 1984), we may indeed to identify something like a paraphrase of the Golden Rule, which, beyond its particular legal meaning, may be considered a general instruction for social interaction. This principle served for regulating the cooperation– defection–sanction–renewed cooperation offer relation. The other root of Smith’s grounding of ethics is the Stoic oikeiosis doctrine, which was succinctly summarised by Diogenes Laertius: An animal’s first impulse, say the Stoics, is to self-preservation, because nature from the outset endears it to itself, as Chrysippus affirms in the first book of his work On Ends: his words are, “The dearest thing to every animal is its own constitution and its consciousness thereof;” for it was not likely that nature should estrange the living thing from itself or that she should leave the creature she has made without either estrangement from or affection for its own constitution. We are forced then to conclude that nature

Adam Smith’s interaction model  165 in constituting the animal made it near and dear to itself; for so it comes to repel all that is injurious and give free access to all that is serviceable or akin to it. (Diogenes Laertius, 1925, Book 7, 85–6) Several times Smith refers to the oikeiosis doctrine as well as to the propensity to one’s own nature, such as: Every man, as the Stoics used to say, is first and principally recommended to his own care; and every man is certainly, in every respect, fitter and abler to take care of himself than of any other person. (TMS, VI.ii.1.1: 219)1 Smith’s modification and modernisation is not just picking into the pool of Stoic ideas, to create and distribute a meme, but also a model of the cultural self-description of the society of possessive individualism given the tough reality of its constraints and liberties, its radical changes and beginnings. In the history of concepts, the term “appropriation” has frequently been applied with multiple and even contradicting meanings. Appropriation in the sense of acquiring that what is supposed to be appropriated, in the sense of shaping, learning, making use of, in the sense of enriching oneself by way of innovation, in the sense of connecting to the wealth of the tradition and the new, and – in view of our days – in the sense of contributing to inter-textual, inter-art, and trans-media ways of activity and communicating. However, contrary to this, appropriation may as well refer to forcible annexation, to stealing from somebody, to incorporating, to cultural expropriation, usurpation, to adopting as one’s own, imitating, plagiarising. The Stoic concept of appropriation was open and contradictious at the same time; it experienced historical metamorphoses, such as the paradigm change, initiated by Locke, from appropriation in the sense of seizure by way of occupation to appropriation by way of labour, under the condition of the individual being his/ her own natural owner. Today, the concept of appropriation is disputed between the Stoic tradition and the identity-political fight against any kind of cultural appropriation, which, in a way, is considered a hostile acquisition of what is appropriated. However, according to Smith, nature has also equipped us with one of the strongest emotions, which is the emotion of vengeance, which may at the same time be tolerated with utmost care and reservation, and never without good reason. Both in the case of the emotion of sympathy and of vengeance, there happens a moment of pausing and postponement that allows for examining the affect. An emotionless, indolent person will be incapable of ethical feelings, an exuberantly compassionate spectator will finally need good reasons to lastingly maintain the emotional tension.

166  Eleonore Kalisch Often the focus is too much on sympathy when attempting to grasp the core of Adam Smith’s anthropologically grounded ethics. However, rooting the ethical attitude into the emotion of vengeance is of at least equal value. This challenges to making it a topic of discussion. It was a long way from qualitative, often bloody, retaliation to formally proportionate retaliation. Aeschylus shaped the breach of the taboo of changing from the vengeance principle of bloody retaliation to the birth of the principle of law as a tragedy. What remained as an open wound was that subliminally still working remnant of the conflict that could not be translated or dissolved into a legal dispute. Adam Smith is far from the talionic principle of an eye for an eye, a tooth for a tooth. He keeps referring the vengeance principle to the Golden Rule, although his concept of vengeance also includes positive reciprocity: To reward, is to recompense, to remunerate, to return good for good received. To punish, too, is to recompense, to remunerate, though in a different manner; it is to return evil for evil that has been done. (TMS, II.i.1.4: 68) In the present time, increasingly the complementarity of vengeance and empathy (which has replaced the concise sympathy concept of the 19th century) is conjured. In this context, there is often a lack of the necessary historically grounded differentiation when it comes to the concept of vengeance. Could any vengeance-reinforced kind of empathy be an option for the future? What must be found is ways of retaliating, of nemesis in the sense of Herder, which will not result in escalation and mutual annihilation. Interestingly, when it comes to economy, Smith recommends sanctioning as a kind of retaliation towards stubborn opponents of free trade. In Smith’s view, the individual is only capable, after all, of satisfying his/her instinct of self-preservation by being tied to the community. Smith agrees with the Stoic suggestion to socially concentrically extend the instinct of self-preservation – from individual self-care as far as to maintaining nature as a whole, which, as cosmopolis, unites gods and humans. In Smith, the natural urge towards community becomes a marketmediated urge towards society. For him, trading, swapping, purchasing were almost innate behavioural trends. He speaks of man’s tendency towards trading and swapping objects. At the same time, Smith is convinced that moral appeals to the community spirit will not achieve much as long as this spirit does not pay off for the individual: That it is not a regard to the preservation of society, which originally interests us in the punishment of crimes committed against individuals, may be demonstrated by many obvious considerations. The concern which we take in the fortune and happiness of individuals

Adam Smith’s interaction model  167 does not, in common cases, arise from that which we take in the fortune and happiness of society. (TMS, II.ii.3.10: 89)

4  “The race for wealth, and honours, and preferments” If nature has left the lives and survival of humans to their own self-care and has provided them with a creative appropriation potential for this purpose, then, however, humans must indeed care for themselves. From this, one has concluded on a disputed legitimation of possessive individualism. On the other hand, however, not even possessive individualists are capable of surviving everyone for him/herself; they depend on the social systems of necessities that can only be served by way of the market, by coordinating specialised gainful activity. This way, each participant in the market as a producer and consumer joins the competition of mutual dependencies and injuries. “All the members of human society stand in need of each others assistance, and are likewise exposed to mutual injuries” (TMS, II.ii.3.1: 85). How does the relation of reciprocal assistance and mutual injuries regulate itself with commercial society? Where, in Smith, do ethics begin and where does economy end? One answer is to be found in the field of sports (foot race, horse race, competition, hunt). This image clearly refers to the market competition, to the hunt for profit, the struggle for predominance and for eliminating the competitor. Smith writes: In the race for wealth, and honours, and preferments, he may run as hard as he can, and strain every nerve and every muscle, in order to outstrip all his competitors. But if he should justle, or throw down any of them, the indulgence of the spectators is entirely at an end. It is a violation of fair play, which they cannot admit of. This man is to them, in every respect, as good as he: they do not enter into that self-love by which he prefers himself so much to this other, and cannot go along with the motive from which he hurt him. They readily, therefore, sympathize with the natural resentment of the injured, and the offender becomes the object of their hatred and indignation. He is sensible that he becomes so, and feels that those sentiments are ready to burst out from all sides against him. (TMS, II.ii.2.1: 83) Interestingly, also Ferdinand Tönnies adopted the image of the race: The true entrepreneurs and businessmen are like sprinter racing each other on many tracks – each is trying to get ahead of the others and to reach the goal first: namely, the sale of his goods in the

168  Eleonore Kalisch greatest possible quantity. They are often obliged to push each other out of the way or to trip each other up. Harm to one means profit to another, as in the case in any individual exchange, except when exactly equal values are changing hands. This is the essence of general competition, which occurs in many other fields but nowhere so clearly or so consciously as in the field of commerce […]. (Tönnies, 2012: 65) The invisible-hand metaphor understands the market to be an autoregulative system that does not require any Divine intervention. Insofar, the metaphor of the (steering) hand might even be supposed to be somewhat ironic. However, the invisible hand of auto-regulation does not make Smith forget about the many visible hands of the market participants with their different interests and positions. The invisible hand does not replace ethics, rather it requires ethical framework conditions. These are no affirmative ethics of permanently invoking values but the prevention of violations of the elementary rule of competition, the rule of fair play. Fair play is the common ethics of the market that cannot be replaced by controlling authorities but requires voluntary behaviour. The common ethics of the market are a performative kind of ethics that must be practised and realised by actor–spectator relations. Smith equalled the rule of fair play with respect to the laws of justice: the laws which guard the life and person of our neighbour; the next are those which guard his property and possessions; and last of all come those which guard what are called his personal rights, or what is due to him from the promises of others. (TMS, II.ii.2.2: 84) In English, the basic meaning of “fair” is “beautiful,” such as “the fair sex;” there is evidence of the meaning of “flawless” for the 12th century, of “favourable” or “advantageous” for the 13th century, of “light-coloured” for the 16th century. As a noun, as early as in the 13th century, “fair” refers to the regular meetings of buyers and purchasers, as early as in the 16th century, the phrase “fair play/foul play” refers to trade in the wider sense as well as to trade, transaction in the stricter sense. Rudolf Kircher emphasises: Fair play is the epitome of values. By these two words, everything is collected which British education and the British attitude of life consider worth striving for and achievable. The words cannot be translated, and it would be senseless to interpret them by one short formula […] fair play regulates the relations to one’s neighbour, and

Adam Smith’s interaction model  169 that is relations quite where the test begins: competition and struggle, contest and affect. (Kircher, 1927: 24) Smith describes the market society of social actors as a society of spectators. The market actors act as providers and buyers, competitors and collaborators, within their spectatorical constellations, among whose main arenas and attractions there count markets and trade fairs, stock exchanges and banks. Beyond their financial transactions, social actors are actors and spectators at the same time. Interpersonal spectatorship enforces transparency; it creates publicity; it becomes professionalised by investigative journalism. A typical example is the London newspaper The Spectator.

5  Private and public Even neoliberalism today needs the visible hand of the state, which retreats when profits are privatised and is called to intervene if losses must be socialised. Hidden hands are still at work, such as the far too many lobbyists and business actors from the grey zone between legality and criminality. In a functioning democracy, there develops a differentiated actor–spectator culture. In such a culture, it should be possible to create publicity for all facts and processes that are relevant for the public. In commercial society, the relation of privacy and publicity has changed compared with courtly life. It is a bourgeois public, which spreads in coffee houses and clubs and is accompanied by a well-networked press and also by the new genre of the social novel. Private life is no longer limited to family and intimacy but includes business. From the perspective of investigative journalism and the curiosity of private individuals, the boundaries between private life and the public become blurred. In the form of stock market speculation and drawing and redrawing, the private economy provides the public with news and scandals. Smith exemplified this transition from private to public interest with the help of a sports metaphor, the race. But does the actor–spectator culture of the commercial society even include the private individual’s self-inspection in terms of his/her own actions? Henry Fielding understands himself to be a historian of private life; in this function, he created the novelty of private life as a topic, worthy of literature, of historiography, which until then had most of all been dealing with political and state issues. A society of spectators: the term implies that mutually related individuals have learned how to be actors and spectators at the same time. And this means that they have mutually made each other capable of changing perspective. However, they must mean it. Changes of perspective cannot

170  Eleonore Kalisch be achieved without activating the will in the sense of John Locke. In Locke, the will is that psychic authority that is able to stop the urge of desire for immediate wish fulfilment – by way of the spontaneous break of pausing and postponement. The impartial spectator is no figure standing around in isolation. He/ she is included in concrete lifeworlds that are configurated by a variety of actor–co-actor–spectator relations. In the social sciences and cultural studies, the analysis of the historical change of the shape of actorship is predominant. Spectatorship, on the other hand, has been neglected, although in social situations, it is not possible to act without involved first-step actors and co-actors who observe each other. Perhaps it is primarily not necessary at all to determine the impartial spectator by way of positive definitions that, after all, amount to an ideal or, at best, to a regulative idea in the sense of Kant. Let us ask instead what the impartial spectator must avoid. To which patterns of behaviour is the impartial spectator a counterdraft? Worthy of consideration are: “[t]he animosity of hostile factions,” “a nation distracted by faction,” “the furious zealots of both parties” (TMS, III.3.43: 155), “faction and fanaticism” (TMS, III.3.43: 156), “paroxysm of distress” (TMS, III.4.4: 158), “delusions of self-love” (TMS, III.4.7: 159) and “the mysterious veil of self-delusion” (TMS, III.4.4: 158). The impartial spectator moves on two levels: on an object level and on a meta-level. He/she is affected by noticeable events and processes; he/ she suffers vicariously; he/she is indignant, desperate, but he/she is not carried off without keeping distance; he/she does not uncritically leave him/herself to his/her affects; he/she keeps a minimum of distance that allows him/her to pause and come to his/her senses. However, there are situations when the paroxysm of emotions and involvement is so strong that it is no longer possible to, at the same time, stay on top of things at a meta-level. However, this is not to say that generally the impartial spectator comes forward only post festum. After all, it is not only about situative affect movements and expressions but about acquired attitudes, emotional dispositions, which serve for psychic stabilisation. The arch-antagonist of the impartial spectator is the extremes: fanaticism on the one hand and indolence on the other.

6  Bourgeois and citoyen By the contradictious relation of the partial and impartial spectators, Smith anticipates the contradiction between the bourgeois, the egotistic private person and businessman, and the citoyen, the citizen with a community awareness who always also asks about the advantage for the whole. Smith accepts the bourgeois as a reality of the commercial society; he does not oppose possessive individualism, but he makes him aware of the ethical relevance of community interests. Doing so, Smith

Adam Smith’s interaction model  171 is well aware that moral appeals alone will not do. Here, Smith pursues a compromise, for he writes for a “society of possessive individualism” (Macpherson) that has been established in Britain between the periods of Hobbes and Locke. Smith wants to convince the bourgeois that commitment for the common good is in his own interest, and he admonishes the citoyen to not in principle condemn the bourgeois as an immoral being. Rather, Smith tries to support the contradictious unity of citoyen and bourgeois. However, there is no distribution of functions such as: the bourgeois has carte blanche for business, and the citoyen is in charge of ethics. By the increasingly media-based circulation of symbols, goods and money, there develop new ways of presentation and communication. Private and public life become mutually pervasive in bourgeois-business and political-representative life. There develop new ways of presentation and of spectatorship. Spectatorship is revaluated to become an integral factor of actorship, thus gaining practical significance. Smith expressed this explicitly by arguing that the individual must present him/herself, prove his/her worth and must be accountable in a society of spectators.

7  The ego-alter-tertius relation in Adam Smith’s work In Adam Smith, ethical judgements on behaviour are first of all of an emotional nature. It is affects that are subject to the pleasure–unpleasure principle. And it is attitudes towards the judged on subject or fact that are in accordance with consolidated subjective dispositions. For this purpose, Smith provides a highly differentiated symptomatology with the emotion of vengeance as its counterpart. The emotional judgements run through a process of being reflected on and finally result in value judgements that become socially effective by communicating approval or disapproval. This is not only about individual, in single cases, or coincidental collective approval or disapproval but about value judgements made by a concrete community of interests and communication – from the club to the party, from the religious community to the scientific and fine arts academy, from the sports club to the professional association. Even more dangerous for those concerned is public disapproval spread by journalists. All these ethical ways of judgement, which may have considerable practical consequences for those concerned, make Smith’s reference to the society of spectators and their power not look like an exaggeration. When bringing together actorship and spectatorship in this way, Smith gets at the heart of the changed understanding of actorship in open society. It is thus only consequent to thoroughly analyse the figure of the spectator by his/her functional variety, his/her distinctive social features, his/her cultural adaptability, to sum it up: by his/her seat in life. Even the market, which would not exist without the activities of the concrete specialised and networked economic actors, is at the same

172  Eleonore Kalisch time a society of spectators, consisting of landlords, merchants, master manufacturers, waged labourers, independent workmen, etc. The participants in the market function as teleo-practical, sympractical and – in the mode of the passer-by – even as para-practical spectators. 2 If these as well as other spectators–actors, notwithstanding any different interests and profiles, take care that the rule of fair play is kept, they do so for the sake of their own safety, to be protected against defraudation and deceit. The professional market participants are first-step actors by their contacts to suppliers, competitors and clients. They fight any attacks on their first-step position off by all honest and dishonest means. Clients are courted third parties who at the same time are pro domo interested spectators. At the same time, they understand themselves to be, as the masters of their purchase decision, to be in a pole position and behave accordingly. Adam Smith always puts affects and emotional dispositions into a sensually concrete situational context, thus establishing a practical relation with the social actors. This way, he unites the analysis of emotional and ethical dispositions with an analysis of the actor–co-actor–spectator relation. He does not simply ask his readers to empathise with others to whose inner life he has anyway no immediate access, but he tells them to put themselves in the other’s shoes. Furthermore, Smith is not only about approving or disapproving with the situation-related affects of others who are involved in struggles or are suffering. He is also about self-approval or self-disapproval. Approval and disapproval refer to the assessed emotion being appropriate or inappropriate given its cause or subject. Exuberance or exorbitance will rather create disapproval, which should itself remain moderate. Both always depend on the actual situation that, of course, also stimulates imaginativeness and recalls the imaginary. Both the emotion of sympathy and that of vengeance find expression in a triadic situation. The latter is created by the first person, the affected spectators, by the second person who experiences suffering or does good deeds, and by the third person who makes the second person suffer or is treated kindly by him/her. This is the triad of the emotions of sympathy and vengeance. In such a situation, all social and benevolent inclinations are expressed, however, all egotistic affects such as envy, resentment, suspicion, contempt of others, greed, the hunt for wealth, power and predominance as well.

8 Could Artificial Intelligence actants be impartial spectators? Currently, we are witnessing a radical cultural change triggered by the computer revolution and thus all possible information-technological springboard innovations (Internet, digitalisation, datafication, social web, etc.). All communication processes and relations have been

Adam Smith’s interaction model  173 revolutionised. The new culture of the digital also creates new kinds of activities for worldwide networked actors. In the context of the online prosumer culture, there appear new kinds of actors: from user-content activists via social web personae as far as to professional influencers. By way of changing the reference levels, the development of artificial intelligence (AI) has extended the spectrum of the powerful actor by digitally created, artificial personae: non-human actors, also called actants. From this, there result new questions, such as: In how far are AI actors, by their encounter with human actors, capable of relation? Could AI actors develop a trans-algorithmic capability to react that might equal human wilfulness, only in different ways? Could we attribute actor status to AI actants simply because they reliably process algorithms and trigger intended processes? Could we attribute the capability to act to a being that is frequently remote-controlled? AI actants are capable of operation, but is this alone identical with the capability to act, which requires trans-algorithmic proceeding and is based on self-regulation? And is it not that AI actants must be capable of trial and error proceedings, which is also an aspect of self-regulation? In line with their expectation, humans position themselves as firststep actors. AI actants position themselves as co-actors, either in a servant- or a cooperative relation to human actors. In any case, they must observe the human first-step actors, to be able at all to establish any relation to them. However, after all, they will have a future only if they unfold wilfulness, if they are also capable of achieving the position of a first-step actor. Then, they will also be able to make humans co-actors, and they may watch them just like their AI co-actants. As yet, it is only a purely theoretical consideration that AI actants might take the initiative in a concrete situation and might try to control human actors. This requires long-term preparation as well as a way of proceeding that requires much deceit. What is going on everywhere is tactical watching, for the time being, experimenters and AI developers believe strategic watching to be their own privilege. Films such as Ex machina (director: Alex Garland, 2014) turn this privilege upside down. There, laboratory director Nathan acts as the privileged spectator who makes everything and everybody subject to his assessing and controlling view. He has professionalised the exact view in the service of science. In a way, this is deceit again, to hide his lustful looks at the artificial subjects of his desire he has made. Nathan does not treat his creations as quasi-subjects but as objects of his purposes. Pygmalion mutates into the destructor of his female artefacts and to a serial offender. Putting up resistance, the AI-woman Ava becomes the subject of her own purposes, a deceitful first-step actor of self-liberation. This figure has no scruples to sacrifice her human aid, Caleb, whom Nathan has hired as a guinea pig without telling him, during her flight. Ava does not have any sympathy for humans, at best, she has imitations of emotions. What remains open

174  Eleonore Kalisch is the question whether AI actants will, for all times, stay in the service of humans, or from time to time revolt by way of destructive excesses and self-destruction, or if they are capable of developing a non-human, artificial life form provided with wilfulness. Should AI actants ever be capable of developing populations of their own, there might result dynamic systems regulating themselves by way of invisible-hand effects. Such a prospect is hinted at in the film her (director: Spike Jonze, 2013). On the whole, it is difficult to imagine that even AI actants should not be capable of acquiring the capability of being affected and of affecting others, these affectations being similar human emotions or not. Why should ongoing evolution not develop new kinds of affectation?

Note 1 See in part. Heise, 1991. 2 “We must distinguish different kinds of tertius spectans, and that is according to the respective relation of contemplativity. We distinguish three kinds: (1) the teleo-practical spectator: a kind of watching which is subject to the practical purpose which is tactically motivated and serves as a means of achieving a goal flexibly and in accordance with the situation; (2) the sympractical spectator: a kind of watching which is included into practical activities and co-supports the practice only by breaking the immediacy, by way of reflection difference; (3) the para-practical spectator: a kind of watching which is somewhat independent of practical inclusion, which takes on contemplative features and allows other activities to be at best secondary” (Franz & Kalisch, 2008: 514).

References Axelrod, R., 1984, The Evolution of Cooperation, Basic Books, New York. Diogenes Laertius, 1925, Lives of Eminent Philosophers, ed. R.D. Hicks, Harvard University Press (“Loeb Classical Library”), Cambridge, MA, vol. II (Books 6–10). Franz, M. & E. Kalisch, 2008, “Tertius Spectans. Die Spektatorische Situation als Spezifische Zeichensituation”, Weimarer Beiträge. Zeitschrift für Literaturwissenschaft, Ästhetik und Kulturwissenschaften, vol. 54, no. 4, pp. 500–29. Heise, P.A., 1991, “Stoicism in Adam Smith’s Model of Human Behavior. The Philosophical Foundation of Self-betterment and the Invisible Hand”, in Adam Smiths Beitrag zur Gesellschaftswissenschaft (Ökonomie und Gesellschaft. Jahrbuch 9), Campus, Frankfurt – New York, pp. 64–78. Kircher, R., 1927, Fair Play. Sport, Spiel und Geist in England, Frankfurter Societäts-Druckerei, Frankfurt a.M. Macpherson, C.B., 1989, The Political Theory of Possessive Individualism. Hobbes to Locke [1962], Oxford University Press, Oxford – New York. Tönnies, F., 2012, Community and Civil Society [1887], trans. J. Harris & M. Hollis, ed. J. Harris, Cambridge University Press, Cambridge. van Suntum, U., 2001, Die unsichtbare Hand. Ökonomisches Denken gestern und heute, Springer, Berlin – Heidelberg – New York.

11 Did Adam Smith hold a labour theory of value? Beaver and deer hunters in the early state Jeffrey T. Young 1 Preliminaries Since Adam Smith has proven to be seminal in the emergence of modern economics, it seems appropriate in this volume to consider at least some, even small, aspect of that legacy. Despite rampant confusion, misunderstanding, and misinterpretation, the value theory chapters of The Wealth of Nations (WN) set price theory on a course such that modern students of economics will easily recognize the family resemblance between Smith’s theory of the natural price and what they learn in a modern price theory textbook. In this chapter, I concentrate, however, on one significant misinterpretation, i.e. attributing a labour theory of value to Smith based on the first paragraph of Book I, Chapter VI. I propose to give a negative answer to the question I have posed in the chapter title. The first paragraph of Book I, Chapter VI, contrary to widespread opinion, does not support a labour theory of value in Smith. To begin, let me define what I mean by a “labour theory of value,” and to do so in a way that does not prove my thesis by definition. To me, the labour theory could entail one or both of two claims: 1 Labour is the sole creator of value; 2 Relative quantities of embodied labour regulate (in the sense of efficient cause) relative prices and relative price movements.1 John Locke has been credited with proposing the labour theory when he wrote: For ’tis Labour indeed that puts the difference of value on every thing; […] I think it will be but a very modest Computation to say, that of the Products of the Earth useful to the Life of man 9/10 are the effects of labour: nay, if we will rightly estimate things as they come to our use, and cast up the several Expences about them, what in them is purely owing to Nature, and what to labour, we shall find, that in most of them 99/100 are wholly to be put on the account of labour. (Locke, 1970: 314)

DOI: 10.4324/9781003301448-14

176  Jeffrey T. Young We must first note that Locke is not talking about prices, so the second claim does not apply. He does seem to be making the first one, however. If we define “value” similarly to what it means in modern economics as subjective satisfaction, then Locke is saying that utility is produced by labour working with nature to create useful objects. We would say he is talking about the production function, where output is expressed in value, i.e., utility, terms, and making the claim that labour’s contribution to the final product is about 99% and land adds about 1%. In the sense of the first claim, this would indeed constitute a labour theory of value. However, creating utility out of nature is not what has generally been meant by the labour theory of value. Beginning with Smith’s beaver and deer hunters and running through Ricardian and Marxian analytical economics is the second claim: relative quantities of labour “embodied” in commodities determine the rates at which they exchange for each other in long-run competitive equilibrium. In short, relative quantities (not monetary costs) of labour determine the structure of relative prices. 2 Competitive market processes will tend to equalize quantities of labour embodied on both sides of an exchange. Thus, if two units of good A exchange for one unit of good B, then good B takes twice as much labour to produce as good A. The quantity of labour exchanged is equal. If labour combines with capital in the form of raw materials, partially finished goods, and/or durable machinery, then these inputs are themselves reduced to previously embodied labour, or indirect labour. Economists have known since Ricardo that the labour dating phenomenon tremendously complicates the analytical relationship between total labour quantities and relative prices. It gave rise to Ricardo’s search for an invariant standard of value, which he also called “absolute value,” and to the “transformation problem” in Marxian economic theory. Smith, however, was apparently completely innocent of the problems involved, and so we need not detain ourselves fruitlessly pursuing Ricardo’s absolute value or Marx’s transformation problem. In this view, value is defined as relative exchange value, which is the relative price structure in a competitive economy. 3 This is clearly not Locke’s meaning. But, if we view the labour theory as a theory of relative prices, then Proposition 1 would usually go along with 2. In this case, the labour theory would also entail the idea that value, defined as relative exchange value, not utility, is created in production and then realized in exchange, and in this sense, Peter Dooley is correct, “The labour theory of value is a production theory of value. […] Labour is the origin of value” (Dooley, 2005: 2). My claim will be that neither of these propositions applies to Smith. I must now establish some interpretive perspectives. In a letter dated 15 March 1788 addressed to Thomas Cadell, his publisher, Smith remarks, I am a slow a very slow workman, who do and undo everything I write at least half a dozen of times before I can be tolerably pleased

Beaver and deer hunters in the early state  177 with it; and tho’ I have now, I think, brought my work within compass, yet it will be the month of June before I shall be able to send it to you. (Corr., 276: 311) As it turned out, this prediction was too optimistic, and the revisions to The Theory of Moral Sentiments (TMS) were much more extensive than Smith envisioned in March of 1788. The new Part VI on the character of virtue had not yet entered into Smith’s plan for the revision. It was not until a few months before his death in 1790 that the sixth edition of TMS saw the light of day. Dugald Stewart, Smith’s first biographer, also noted Smith’s careful attention to composition. He conjectures that because Smith was so careful with what he allowed of his work to be published, that this perfectionism explains why he had his unfinished manuscripts burnt, “[a] few days before his death […]” (Life, V.8: 327). In his published works, Smith’s word choice has gone through an extensive process of writing and rewriting, and he would not let manuscripts be published if he felt they were not up to his high standards of composition. We must take his words seriously; close reading of the text will produce fruitful insights into Smith’s meaning. Next, we may note that Smith scholars now see spectating as playing a very extensive, and previously unnoticed, role in all of Smith’s work, WN included.4 In particular, they have noted two perspectives from which Smith, the author, and we, his readers, are cast in the role of observers. Knud Haakonssen, for example, points out a distinction between contextual knowledge and system knowledge: contextual knowledge, he says, Is the kind of concrete knowledge which arises from specific situations and which gives rise to common-sense ideas of behaviour wherever people live together. It concerns the immediate circumstances of individual actions, and it almost automatically gives rise to an evaluation of the appropriateness, or propriety, of the action which was in fact taken. In contrast to this, system knowledge is the understanding of things, events, or persons in some sort of functional relationship to a greater “whole” or system – or the understanding of all the elements in such a system. (Haakonssen, 1981: 79) Charles Griswold, also notes this distinction when he calls this contextual knowledge, the “standpoint of ordinary life” (1999: 13). And Smith writes: Many improvements have been made by the ingenuity of the makers of the machines, when to make them became the business of a peculiar trade; and some by that of those who are called philosophers

178  Jeffrey T. Young or men of speculation, whose trade it is, not to do any thing, but to observe every thing; and who, upon that account, are often capable of combining together the powers of the most distant and dissimilar objects. (WN, I.i.9: 21) And then, much later in the book, Smith describes the work as “speculative,” suggesting that the perspective of the philosopher who acts as an impartial, but curious, observer is the viewpoint we naturally adopt as his readers (WN, V.iii.68, 933–4). In short, the reader/author spectates from two points of view: the philosophical and the contextual. As a philosopher/observer Smith develops speculative models of larger systems and also engages in the moral judgement of such systems. An example of the latter would be Smith’s assertion that [a]ll constitutions of government […] are valued only in proportion as they tend to promote the happiness of those who live under them. (TMS, IV.1.11: 185) It is this standard, of course that Smith uses to condemn the mercantile system. However, when he places us into the context of the agents, they are assumed to learn solely from empirical experience, and, this means to take one example, that the [d]ivision of labour, from which so many advantages are derived, is not originally the effect of any human wisdom, which foresees and intends that general opulence to which it gives occasion. (WN, I.ii.1: 25) Spectating from this perspective, we see spontaneous orders emerging as unintended consequences of individual, contextual, i.e., based on their perceived local situation, behaviour. Smith has also noted an historical aspect to the interplay between these two perspectives: In every age and country of the world men must have attended to the characters, designs, and actions of one another, and many reputable rules and maxims for the conduct of human life, must have been laid down and approved of by common consent. […] They might continue in this manner for a long time merely to multiply the number of those maxims of prudence and morality, without even attempting to arrange them in any very distinct or methodical order, much less to connect them together by one or more general principles, from which they were all deducible, like effects from their natural causes. The beauty of a systematical arrangement of different observations

Beaver and deer hunters in the early state  179 connected by a few common principles, was first seen in the rude essays of those antient times towards a system of natural philosophy. Something of the same kind was afterwards attempted in morals. (WN, V.i.f.25: 768–9) Rules and maxims of conduct, morality, emerge first as spontaneous orders. To understand these processes, we must place ourselves into the context of the agents. This is essentially what Smith does throughout most of TMS. Only much later, after the advent of writing, do speculative systems emerge to impose order in the form of a “few common principles” that explain cause and effect, first in natural science and then later in moral science or moral philosophy. This is what Smith does in WN, which because economics is a moral science, is also a work of moral philosophy. 5 Thus, in TMS, we generally spectate from the contextual point of view, and in WN, we observe as philosophers. However, these are generalizations; both perspectives appear in both books. We might also note, without going into it, echoes of the posthumous Principles Which Lead and Direct Philosophical Enquiries.

2  Beaver and deer hunters Having established what I think we should mean when we say some writer holds to a labour theory of value, and having established some exegetical ground rules, I turn now to the main topic of this chapter: the beaver and deer hunters. In so doing, I will attempt to put the beaver and deer hunters into a rather different light than is normally found in the literature. Before getting to the little vignette of the first paragraph of Book I, Chapter VI, we might note that if it is a story about the causal determination of relative prices, Smith has put it into the wrong chapter. Chapter VI is the second of three value theory chapters, and it is not until we get to the next one on market and natural price that Smith offers an explanation of how competitive market processes determine an equilibrium-relative price structure. This chapter is about the component parts of price, in which Smith is engaged in an accounting exercise to distinguish original sources of income (wages, rent, profit) from derived incomes (pensions, wages of unproductive, i.e., service, labour, incomes paid from taxes). As such, I believe this chapter actually makes no claims about the causal determination of the relative price structure. In this context, then, the point of the beaver and deer exercise is to establish that labour’s share exhausts the entire output, i.e., it is the only component of price. There is only labour income. Now the chapter begins with the beaver and deer hunters, as Smith writes: In that early and rude state of society which precedes both the accumulation of stock and the appropriation of land, the proportion

180  Jeffrey T. Young between the quantities of labour necessary for acquiring different objects seems to be the only circumstance which can afford any rule for exchanging them for one another. If among a nation of hunters, for example, it usually costs twice the labour to kill a beaver which it does to kill a deer, one beaver should naturally exchange for or be worth two deer. It is natural that what is usually the produce of two days or two hours labour, should be worth double of what is usually the produce of one day’s or one hour’s labour. (WN, I.vi.1: 65, italics added) This one paragraph is the locus classicus of the claim that Smith held a labour theory of value, at least in the sense of Proposition 2, above.6 Indeed, you should see the obvious parallel between my hypothetical example of goods A and B and the beaver and deer here. The passage raises two questions: –

What sort of a thing is this “rule”? Is it like a social convention, such as “drive on the right”? Is it, as I have argued, a rule of justice, as in the general rules of morality (Young, 1986; 1997) or is it a scientific principle as Smith seems to imply, at the end of Book I, Chapter IV (WN, I.iv.14: 46)? – How do we interpret the two deer for one beaver exchange rate, which seems to hinge on the meaning of the word “usually”? The passage has universally been viewed as an exercise in analytical economic theory. As such, the most common interpretation of this paragraph is, first, that Smith is enunciating a scientific principle, and second, the principle is, in modern terms, that the rate of exchange has to equal the marginal rate of transformation, i.e., that comparative cost determines the price structure, because any other ratio is not an equilibrium, and I teach this myself when I teach Smith’s theory of value. Let us use Mark Blaug’s widely read text as a case in point: The advanced student of economics may benefit from the following justification of Smith’s approach which borrows the tools of twentiethcentury economics to clarify the logic of the constant-costs case. (Blaug, 1997: 40) He then presents a graphical interpretation using a linear transformation curve and modern supply and demand diagrams. The passage is also amenable to a Marxian interpretation, and Marxist scholars have generally agreed that Smith is advancing “a hint of a labour theory of natural value” (Dobb, 1973: 45). Analytically, there is no difference between a Neoclassical and a Marxian theory of value under the stated conditions of no accumulation of capital or appropriation of land, but I now believe

Beaver and deer hunters in the early state  181 that all historians of economics, including my earlier self, have gotten the beaver and deer wrong. This is not at all what Smith is doing here. The “rule” is not a scientific principle, and it is not a theory of price in the modern sense. It is, therefore, not a labour theory of value as defined above. My earliest work on Smith led me to the conclusion that we have to take the idea of a “rule” seriously, and we should treat this as a rule of justice. In this sense, then, “rule” is like “law” in the sense of those maxims Smith is talking about in the passage from Book V quoted above. It emerges spontaneously by “common consent.” It is not like “rule” as in “law of nature” as those principles by which God governs the natural order. In fact, Smith has already, in preparing the ground for the value theory chapters, spoken of both “rules” and “principles.”7 If Smith is the careful writer we believe he was, then I claim that this change from “rule” to “principle” is significant. Given how he distinguishes the two in the passage above, he does not intend them to be synonymous. There is a difference between rules and principles, which I believe is important in understanding the text. I shall have more to say on this in due time. As for the second question, equating the rate of transformation, the rate at which hunters can exchange beaver for deer in the woods, to the rate of exchange in the market (adjusting the market price to the natural price) depends upon two assumptions that may not at all be legitimate. Namely, that there is in fact a market, and that there is no division of labour, or at least little to no specialization between deer hunting and beaver hunting. Let us begin by unpacking what Smith means by “usually.” Consider the following production possibilities of two hypothetical hunters: CASE 1 Hunter

Hours to catch one beaver

Hours to catch one deer

A B

2 2

1 1

Figure 11.1:  “Usually” means all hunters face the same production possibilities

Before commenting, consider a second set of production possibilities for the two hunters: CASE 2 Hunter

Hours to catch one beaver

Hours to catch one deer

A B

2 3

2 1

Figure 11.2:  Each hunter has an absolute advantage

182  Jeffrey T. Young Notice that in CASE 1, there is no basis for division of labour. A or B is equally adept at both kinds of hunting. They both have access to the same production function in each commodity. Without using bourgeois theoretical categories, this is a point that Marx always makes explicit when he explains the concept of abstract labour, which the labour theory of value requires, since it is the quantity of labour alone that determines the quantity of value. Marx writes: So far as they are values, the coat and the linen are things of a like substance, objective expressions of essentially identical labour. But tailoring and weaving are, qualitatively, different kinds of labour. There are, however, states of society in which one and the same man does tailoring and weaving alternately, in which case these two forms of labour are mere modifications of the labour of the same individual, and not special and fixed functions of different persons; just as the coat which our tailor makes one day, and the trousers which he makes another day, imply only a variation in the labour of one and the same individual. (Marx, 1887: 50–1, italics added) For labour quantities in any way to determine competitive market exchange ratios, the labour must in some sense be undifferentiated. In Smith’s early and rude state, the trade-off of one beaver for two deer in production must be the same for everyone in the village. Each hunter individually must be able to hunt either beaver or deer, and each must be able to hunt either animal if the market exchange rate is out of equilibrium according to all known (to me) interpretations of the passage. Everyone, in short, faces the same, linear, transformation function. Thus, if in the “market” two beavers can be exchanged for one deer, then hunting deer and exchanging for beaver is the best way to get a beaver. This being true for everyone, deer will be in excess supply, and the “market price” of deer will fall. The converse is also true. If one beaver is exchanged for three deer in the “market,” then beaver hunting and exchange are the cheapest ways to get deer, since two hours of beaver hunting will get one beaver, which saves three hours of deer hunting. Beaver will be in excess supply and the market price of beaver will fall. Only if the exchange ratio is the same as the labour-embodied ratio, 2D = 1B, will the market price be in equilibrium. This is what the textbooks say, and it does not depend on holding a Neoclassical or Marxian theory of value. The two yield the same results in this case. Smith, we might notice, has not yet defined the natural price as distinct from the market price, neither does he explain how the market price will adjust to equal the natural price. Smith reserved this analysis for his next chapter on market and natural price, and then, only

Beaver and deer hunters in the early state  183 for the advanced state. That this analysis is missing here suggests that this is not about price determination. Now consider CASE 2. This second scenario supposes that there is division of labour and specialization according to absolute advantage. 8 In this case, “usually” would mean that the deer hunter “usually” takes one hour to catch a deer (and everyone else takes longer), and the beaver hunter “usually” takes two hours to catch a beaver (and everyone else takes longer). The example requires that this information is generally known, and so “usually” could also entail that it is public knowledge, i.e., the impartial spectator knows it. It is contextual knowledge. I think it is important in context to remember that Smith has already discussed the division of labour, and he has provided a brief conjectural history of how it may have arisen in the rude state.9 In a tribe of hunters or shepherds a particular person makes bows and arrows, for example, with more readiness and dexterity than any other. He frequently exchanges them for cattle or for venison with his companions; and he finds at last that he can in this manner get more cattle and venison, than if he himself went to the field to catch them. (WN, I.ii.3: 27, italics added) Notice that here there is exchange, but no agreed rate of exchanging bows/arrows for cattle/venison. Note also the arrow maker has absolute advantage over his companions when it comes to making arrows, and exchange is among “companions.” In the very next paragraph, Smith claims that [t]he difference of natural talents in different men is, in reality, much less than we are aware of; and the very different genius which appears to distinguish men of different professions, when grown up to maturity, is not upon many occasions so much the cause, as the effect of the division of labour. (WN, I.ii.4: 28) Apparently, there are some natural differences of talents that predate specialization, as there is already a person who has absolute advantage in arrow making. But all Smith is claiming is that these natural differences are smaller than they seem. Therefore, I do not think this is sufficient evidence to overturn what David Levy and Sandra Peart have called Smith’s moral commitment to “analytical egalitarianism” based on Smith’s claim about the philosopher and the street porter (Peart & Levy, 2005). However, it does seem that Smith needs to import some sort of natural difference to get his story off the ground.

184  Jeffrey T. Young We might also note that in Book II, Smith claims that some accumulation of stock must precede division of labour: As the accumulation of stock must, in the nature of things, be previous to the division of labour, so labour can be more and more subdivided in proportion only as stock is previously more and more accumulated. (WN, II.intro.3: 277) The conjectures of Book I make no mention of accumulating stock, but what Smith says here does not contradict the story about arrows and deer. First, we should realize that all Smith is claiming about accumulation is that there must be some. In this case, there must be food on hand to feed the deer hunters and arrow makers while they hunt and fashion arrows. This we may assume is implied. Secondly, this crude accumulation does not imply that we have left the early state, since there is no reason to assume that there is a separate class of capitalists advancing the food stocks to the workers, and, therefore, no profit as a separate form of class income. In fact, they are conspicuous by their absence. And, lastly, arrows are themselves circulating capital in deer hunting.

3  Rules vs. principles In reading about the hunters and arrow makers in WN, Book I, Smith’s former students might have remembered a similar story when Smith taught this material in his moral philosophy classes at Glasgow University. There, Smith is reported to have said: A savage who supports himself by hunting, having made some more arrows than he had occasion for, gives them in a present to some of his companions, who in return give him some of the venison they have catched; and he at last finding that by making arrows and giving them to his neighbour, as he happens to make them better than ordinary, he can get more venison than by his own hunting, he lays it aside unless it be for his diversion, and becomes an arrow-maker. (LJA, vi.46: 348, italics added) I have discussed this passage before, where I pointed out that the failure to mention gift-giving in the WN account should not be taken too seriously (Young, 2000: 101). In WN, the point seems to be pretty much taken for granted until Smith states explicitly that “Commerce […] ought naturally to be, among nations, as among individuals, a bond of union and friendship” (WN, IV.iii.c.9: 493, italics added). But he does specifically say that these men are “companions,” which could also imply that the exchanges are gifts. Thus, if beaver and deer hunting are

Beaver and deer hunters in the early state  185 assumed to be separate types of labour in which one person can catch a beaver in two hours and another can catch a deer in one hour, and if we are dealing with friends and neighbours, not impersonal markets, then the sort of arbitrage that I posited above will not be the social process that establishes the rule that 1B = 2D. In other words, the process that Smith will describe in the next chapter of how market price adjusts to natural price is not at all the same social process that establishes the rule of exchange in the rude state. In the early state, there is no market, at least not at the stage we are envisioning here. Hence, there is no market price that could be out of equilibrium with the 1B = 2D natural price. Using Smith’s own principles, I will attempt a conjectural history of Smith’s conjectural history to fill in what I think may take place in the early state instead of market price adjustment. Recall that there is an important change of perspective when Smith states the questions that the theory of value addresses. The first statement was about the rules by which people establish rates of exchange and the second statement was about enunciating the principles that govern exchange rates. This, I claimed, reflected an important distinction as it presents the reader with a change of perspective from initially being a contextual observer who views the situation from the perspective of the agents involved to the systematic perspective of the philosopher who establishes scientific principles about the behaviour of the system. I now claim that this same switch in perspective is taking place in the first few paragraphs of Book I, Chapter VI. We are initially viewing the scene from the contextual perspective as we enter into the agents’ perspectives. Seen in this light by “rule,” I would suggest that what Smith means is not a scientific principle but rather something like a maxim by which we live together in the absence of codified law. I think that the rule for exchanging beaver and deer is a maxim that guides human behaviour in society where interactions are on a personal level. If it is commonly known that the deer hunter “usually” takes half the time to get his deer than the beaver hunter to get his beaver, then the exchange rate would emerge inductively by common consent, in conversation among neighbours, not in a marketplace. It would initially take the form of a reciprocity norm: exchange should in some sense be equal, and hours of toil and trouble seem to present themselves as a natural equalizer in this context. The account in the Lectures, is quite clear that division of labour in the early state is first governed by maxims of reciprocity. Filling in the blanks, so to speak, we might argue that before there was anything like market exchange, there was gift-giving between neighbours. In my earliest work on Smith, I made the argument that the rules involved here are rules of justice, while somewhat later, I discovered (or noticed for the first time) the gift exchanges. The point is that exchange entails reciprocity, and that the social rules governing reciprocity may be either formal rules of justice or informal rules associated with giving and receiving gifts,

186  Jeffrey T. Young which are the rules of gratitude. The latter evolve into the former, justice at some point, or by degrees, takes over from gratitude in the relationship between beaver and deer hunters, as exchanges become increasingly impersonal between strangers. This would also coincide with the evolution of property rights as society passes through pastoral and agricultural stages on its way to becoming a fully formed commercial society. Now we should be clear about the relationship between justice and benevolence, the virtue which prompts gift-giving. Smith’s distinction between the rules of justice and those of benevolence are well known, so I will not rehearse them here. However, perhaps less well known is the close affinity between gratitude and resentment, virtues associated with the response of the agents who are the recipients of acts of benevolence or of acts of injustice respectively. Gratitude is the virtue associated with the recipient of a gift, and it establishes the appropriate reciprocal obligation. Regarding these sentiments, Smith writes, [t]he sentiment which most immediately and directly prompts us to reward, is gratitude; that which most immediately and directly prompts us to punish, is resentment. (TMS, II.i.1.2: 68) Thus, gratitude is the proper sentiment of the neighbour who was given some surplus arrows, and resentment is the sentiment of a beaver or deer hunter who felt he was robbed of his catch. Gratitude is the proper response because it elicits the approval of the spectators, us: When we see one man assisted, protected, relieved by another, our sympathy with the joy of the person who receives the benefit serves only to animate our fellow-feeling with his gratitude towards him who bestows it. (TMS, II.i.2.4: 70, italics added) There is a double sympathy involved in gratitude. The spectators, us again, must also be able to sympathize with the motives of the agent that bestowed the gift: First, I say, That wherever we cannot sympathize with the affections of the agent, wherever there seems to be no propriety in the motives which influenced his conduct, we are less disposed to enter into the gratitude of the person who received the benefit of his actions. (TMS, II.i.3.2: 72) Surely, we can sympathize with the motives of the arrow maker who gives his extras to his neighbour. He would not feel jealousy or begrudge

Beaver and deer hunters in the early state  187 his neighbour, since by assumption, the arrows are surplus to him. He has no use for them, so he must have intended to give away any arrows he had left over after the hunt. Just as justice and benevolence are contrasting virtues, gratitude and resentment also have a close affinity: Gratitude and resentment, however, are in every respect, it is evident, counterparts to one another; and if our sense of merit arises from a sympathy with the one, our sense of demerit can scarce miss to proceed from a fellow-feeling with the other. (TMS, II.i.5.7: 76) Sympathy with the resentment of an agent who has been injured is the basis of the virtue of justice. “The man who resents the injuries that have been done to me, and observes that I resent them precisely as he does, necessarily approves of my resentment” (TMS, I. i.3.1: 16), and it is the safeguard of justice: Resentment seems to have been given us by nature for defence, and for defence only. It is the safeguard of justice and the security of innocence. It prompts us to beat off the mischief which is attempted to be done to us, and to retaliate that which is already done; that the offender may be made to repent of his injustice, and that others, through fear of the like punishment, may be terrified from being guilty of the like offence. (TMS, II.ii.1.4: 79) Thus, resentment and gratitude are to each other as injustice is to benevolence. Smith usually presents justice and beneficence/benevolence as contrasting virtues, a theme that carries through to the most often quoted passage in WN: It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from their regard to their own interest. We address ourselves, not to their humanity but to their self-love, and never talk to them of our own necessities but of their advantages. (WN, I.ii.2: 26–7) However, the close affinity between acts of beneficence that should be rewarded and acts of injustice that should be punished, suggests that justice and benevolence are not that far removed from each other. Indeed, they both support reciprocity among humans, who are constantly in need of each other’s assistance. The fact that we address ourselves to the self-interest of the butcher does not preclude the possibility of

188  Jeffrey T. Young other forms of social order in which we relate through reciprocal acts of gift-giving. This idea is reinforced when Smith claims that after justice, the rules of gratitude are the next most exact: The general rules of almost all the virtues, the general rules which determine what are the offices of prudence, of charity, of generosity, of gratitude, of friendship, are in many respects loose and inaccurate, admit of many exceptions, and require so many modifications, that it is scarce possible to regulate our conduct entirely by a regard to them. […] Of all the virtues I have just now mentioned, gratitude is that, perhaps, of which the rules are the most precise, and admit of the fewest exceptions. (TMS, III.6.9: 174, italics added) Thus, the exactness of the beaver and deer exchange does not preclude my interpreting it as gratitude-based reciprocity. Agents in their own local situation probably have a pretty good idea how difficult deer hunting and beaver hunting are, and the rules of reciprocal gift-giving are capable of fairly precise, but perhaps not perfect, quantification. Nothing I am saying here contradicts Smith’s important hierarchy of justice and benevolence/beneficence.10 Beneficence […] is less essential to the existence of society than justice. Society may subsist, though not in the most comfortable state, without beneficence; but the prevalence of injustice must utterly destroy it. (TMS, II.ii.3.3: 86) To say that exchanges are governed by rules of beneficence and gratitude prior to their coming under the more formal protection of justice does not deny the foundational place of justice in establishing social order. Smith’s hunters and arrow makers are assumed not to be in a position of constantly harming each other. “Nobody – writes Smith – ever saw one animal by its gestures and natural cries signify to another, this is mine, that yours; I am willing to give this for that” (WN, I.ii.2: 26, italics added). “Mine” and “thine” must already apply to the beaver and the deer, and indeed, we may assume that this is the case in the hunting state of society.11 The laws of justice would also protect the hunters’ persons from all sorts of injury. However, if private property is not very extensive (beaver and deer, but not beaver and deer habitat), and not very valuable (beaver before the advent of the Hudson Bay Company), then informal rules between neighbours will be sufficient to sustain both types of hunter as well as arrow makers. They would not have to address each other’s self-interest. If this is the case, the modern story about supply and demand equilibrium in the

Beaver and deer hunters in the early state  189 market simply does not apply, and we are left with the “rule” being a socially agreed rule of gratitude. However, when property becomes valuable enough and extensive enough, such that failure to reciprocate entails a sufficiently high loss, then punishment may be deemed appropriate, and the laws of justice would over time replace the rules of gratitude, and agents would address each other’s self-interest. This would in some sense be a stepping-stone to the emergence of the market as it is modelled in economic theory as an impersonal mechanism. As such markets, in which exchange is governed by the laws of justice, extend the network of reciprocity to strangers. The necessary assistance now encompasses a much larger population, and a more extensive division of labour becomes possible. The extent of the market, and, along with it, the extent of capital accumulation, then, become the limiting factors in the extent of the division of labour, one of Smith’s most famous and important economic theorems.

4 Conclusion: Smith did not hold a labour theory of value In this chapter, I have taken Smith’s distinction between rules and principles seriously, and I have suggested that it arises out of the dual perspectives from which Smith and his audience observe the scenes he lays before us in his texts. Rules arise out of sympathetic interaction in the daily interactions of social life. They are spontaneous, unplanned and, in the case of justice, necessary for the existence of society. Principles arise out of philosophical speculation, which comes later in human development. In short, people make rules; philosophers make principles. I have applied this to the first paragraph of Book I, Chapter VI, and argued that the point of view of agents spontaneously generating rules of conduct is the correct perspective to understand Smith’s text. The source of error in my view has been to ignore this distinction, and, therefore, to treat rules and principles interchangeably.12 Once we accept the distinction and take it seriously, something quite different from the normal textbook treatment of the beaver and deer hunters emerges. Rather than some equilibrating market process, we have essentially the same sort of agent/spectator sympathetic interaction going on as Smith lays out in TMS. I have proposed a conjectural history of Smith in which the rule of exchange is initially a rule of gratitude, and that only with the evolution of property rights, increasing value of those rights, and the extension of the division of labour do the rules take on the form of justice, which underpins all society, commercial society included. Only then can philosophers begin to discern principles that regulate markets. I have also shown that as an analytical principle, the labour theory requires some pretty stringent assumptions. The equilibrating process spelled out in the textbooks assumes that all hunters have the

190  Jeffrey T. Young same production possibilities. However, if there is an absolute advantage as a basis for specialization, they will not all have the same comparative costs, and the equilibrating process cannot get off the ground. It is for all of these reasons I claim the beaver and deer hunters do not support a labour theory of value in Smith. He did not just abandon the labour theory in the second paragraph of the chapter. He never proclaimed it in the first place.

Notes 1 I have purposely left out the “labour commanded” interpretation of the labour theory of value, because it deals with measurement, not causation. 2 The theory asserts that relative exchange values are determined by the quantity of labour; the implication is that wage rates have nothing to do with explaining the relative price structure in a competitive economy. In the example above, if the units of labour are all paid the same wage, then the wage cancels out of the equation and the labour quantities equalize. 3 As a theory of relative price, it has always been confined to competitive market conditions in which wage and profit rates equalize throughout the economy. It has always been understood not to apply to monopoly pricing and the pricing of natural resources that cannot be reproduced by human labour. 4 One example would be Levy, 1995: here Levy distinguishes between the impartial spectator and the partial spectator, i.e., we who observe only naively, and therefore reach common, but wrong opinions (301). 5 By moral science, I mean the old-fashioned appellation for that science that investigates phenomena caused by human agency. 6 There are other passages where Smith may be seen as holding the labour theory, such as a few paragraphs later (WN, I.vi.4: 65). However, this takes us into issues that go far beyond the scope of this chapter. If I have convincingly supported my claim that the first paragraph of the chapter does not do what it has been traditionally thought to do, namely, propose the labour theory, then that is sufficient for now. 7 At WN, I.iv.12: 44, Smith asks, “What are the rules which men naturally observe?” and then at WN, I.iv.14: 46, he says he wants to investigate the “principles which regulate the exchangeable value of commodities” (italics added in both). 8 As is well known, the principle of comparative advantage had not yet been discovered. Ricardo, who is usually credited with its discovery, knew that the labour theory will only give a range within which equilibrium rates of exchange will fall. The theory breaks down in the presence of comparative advantage. Consider the beaver and deer hunters specializing according to comparative advantage: Hunter Hours to catch one beaver Hours to catch one deer A

2

2

B

4

8

Ahas absolute advantage in both commodities, but only comparative advantage in deer, while B has comparative advantage in beaver. In this case, there is no equilibrium price based on labour time alone. A would be willing to

Beaver and deer hunters in the early state  191 take anything more than one beaver for one deer, and B would be willing to give up to one deer for two beavers. Equilibrium is indeterminate between one and two beavers per deer. More information, such as the marginal rate of substitution, i.e., willingness to pay for deer and beaver, is needed. 9 Dugald Stewart was the first to denote Smith’s methodological approach to writing history as “conjectural history.” This method arises, says Stewart, when we cannot trace the process by which an event has been produced, it is often of importance to be able to show how it may have been produced by natural causes. […] To this species of philosophical investigation, which has no appropriated name in our language, I shall take the liberty of giving the title of Theoretical or Conjectural History; an expression which coincides pretty nearly in its meaning with that of Natural History, as employed by Mr Hume, and with what some French writers have called Histoire Raisonnée. (Life, II.47–8: 293) The account of the origin of the division of labour certainly fits into this description. 10 For my purposes in the text, the distinction between benevolence and beneficence is not relevant. Benevolence, literally a good will in Latin, is not the same as beneficence, a good act which may or may not proceed from a good will. The neighbour giving away arrows may have a good will or not, hence in this case, I think the two concepts can be conflated. 11 Smith’s account of the origin and evolution of property rights is found in the extant Lectures on Jurisprudence. Presumably, this material was part of the unfinished manuscripts Smith had his executors burn. It is beyond the scope of this chapter to discuss this material here. Suffice it to say that Smith presents an origin story in the early state of how the idea of property as an exclusive privilege of some sort originated, and that hunted animals, such as beaver and deer, were among the first instances of property in his conjectural history (LJA, i.35–44: 16–20). 12 Dobb, for example, conflates the two: “cause or ‘rule’ (i.e. principle) of value” (1973: 47).

References Blaug, M., 1997, Economic Theory in Retrospect, 5th ed., Cambridge University Press, Cambridge. Dobb, M., 1973, Theories of Value and Distribution Since Adam Smith, Cambridge University Press, Cambridge. Dooley, P.C., 2005, The Labour Theory of Value, Routledge, London – New York. Griswold, C.L., Jr., 1999, Adam Smith and the Virtues of Enlightenment, Cambridge University Press, Cambridge – New York. Haakonssen, K., 1981, The Science of a Legislator: The Natural Jurisprudence of David Hume and Adam Smith, Cambridge University Press, Cambridge. Levy, D.M., 1995, “The Partial Spectator in the Wealth of Nations: A Robust Utilitarianism”, The European Journal of the History of Economic Thought, vol. 2, no. 2, pp. 299–326. Locke, J., 1970, Two Treatises of Government [1689], A Critical Edition with an Introduction and Apparatus Criticus, ed. P. Laslett, Cambridge University Press, Cambridge.

192  Jeffrey T. Young Marx, K., 1887, Capital, vol. I [1867], Progress Publishers, Moscow. Peart, S.J. & D.M. Levy, 2005, The “Vanity of the Philosopher”: From Equality to Hierarchy in Postclassical Economics, University of Michigan Press, Ann Arbor. Young, J.T., 1986, “The Impartial Spectator and Natural Jurisprudence: An Interpretation of Adam Smith’s Theory of the Natural Price”, History of Political Economy, vol. 18, no. 3, pp. 365–82. ———, 1997, Economics as a Moral Science, Edward Elgar Publisher, Cheltenham. ———, 2000, “Adam Smith’s Two Views of the Market”, in P.L. Porta, R. Scaz­ zieri & A. Skinner (eds.), Knowledge, Division of Labour and Social Institutions, Edward Elgar Publisher, Cheltenham, pp. 95–110.

12 Endogenous ethics Smith’s real contribution to the Enlightenment Amos Witztum

1 Introduction One of the Enlightenment’s most significant contribution was the shift back to the endogenisation of explanations. Instead of understanding the world through the design of an exogenous force (usually divine, as was the case throughout the Scholastic era), we now seek intrinsic explanations that are based on the properties, behaviour and interactions of those fundamental units that comprise the system. At first, the process of endogenisation was focused on the physical world.1 But inevitably, it spread into the social domain too. 2 If we can explain the physical world – by experience and reason – as reaching a sustained and clearly observable order through the balance of the activities of all its components, so can, perhaps, sustained social order be explained – again, through experience and reason – as resulting from compatible activities and interactions of its own elements. However, when it comes to understanding society, the idea of endogenisation becomes somewhat more complex. The main reason for this is that unlike the elements that comprise the physical world, humans – who are the atoms of society – are consciously aware of the principles that are supposed to govern their behaviour. The behaviour of particles in the natural world is usually independent of the consequences that such a behaviour will bring about.3 In fact, the particles have no expectations at all with regard to the purpose of their own properties or behaviour. Humans, on the other hand, are conscious of their properties, aware of the effects of their actions and have expectations with regard to the consequences of these either to themselves or to others.4 If we add to this awareness the possibility of human autonomy, 5 then endogenising the social sciences requires not only to know how certain properties (or character attributes) and behaviours lead to particular outcomes (which may, in turn, constitute a self-regulated system), but also to be able to understand how the awareness of individuals of these circumstances and outcomes may affect their own character, behaviours or expectations.6 The implied recursive nature of endogenising social theories suggests two crude lines of potential feedback. The first is the case where a

DOI: 10.4324/9781003301448-15

194  Amos Witztum consistent failure of a particular behavioural strategy in achieving one’s objectives leads to a revised choice of strategy (or behaviour). The second, perhaps the more problematic one, is predicated on the essence of humans as social beings. Regardless of the raison d’être of social organisation, individuals will be aware of the others, their expectations and their relationship with them. Evidently, these relationships are the subject of what we call ethics. As endogenising explanations means an inherent interdependence between agents, the pursuit of any strategy to achieve whatever it is people seek to achieve will inevitably have moral consequences. Therefore, a successful achievement of one’s objective requires not only the right choice of strategy in terms of its ability to deliver the expected outcome for the actor but also a choice of strategy that is consistent with whatever is one’s moral conception of social relationships. The difficulty emanating from the recursive nature of endogenising social analysis (mainly, the second form of a feedback) came to the fore at a very early stage when Mandeville (1988) posed a social dilemma. The problem he posed can be summarised in the following way: what happens if that which we want as a society (say, material plenty) can only be obtained by a behaviour that is morally repugnant? In the case of Mandeville, the starting point was a separation between ethics and society (or economics) and an exogenous source of morality. The moral values that people had were derived from a divine corpus and, so he argued, clashed with people’s presumed natural desire for plenty of material well-being. Supposing for a moment that Mandeville was right about the behavioural qualities needed for the generation of material plenty, for a social order to exist would have required the endogenisation of ethics. Society cannot subsist for long if there is a universal disapproval of the behaviour of its agents or of the consequences to which such behaviour give rise. In this particular case, endogenising ethics would have meant one of two: either, through observation, experience and reason, society would create a moral system – like, for instance, a utilitarian one – that approves of the behaviour that generates material plenty by being a consequentialist theory, or, instead, society could declare the acquisition of material well-being a disapproved form of behaviour and thus, make material plenty a moral vice. But one thing is clear: society cannot remain in the position of private vice, public good and claim that a social order exists.7 There is, of course, another aspect that is relevant for the endogeneity of ethics and it is related to the outcomes – rather than the behaviour – of the pursuit of material well-being. The fact that we may morally approve of the behaviour that generates material well-being does not mean that we also approve of its distributional consequences. If we do not approve of the distributional consequences, we would again need to revise our views of the morality of the behavioural traits that are necessary for the generation of material plenty. Only when the value system we create is consistent with all aspects of social life (motives to action

Endogenous ethics  195 and distributional consequences) can we say that we have created an endogenous theory of ethics. In spite of this tremendous burden emanating from the effort to endogenise explanations, neither economic theories nor ethics have actually risen to the challenge. The reason for this is that with very few exceptions, in theorising both economics and ethics, there seems to be only one-directional analysis: from the individual to the outcome.8 Economics, as a rule, followed this one-directional reasoning in search of a natural, or spontaneous order.9 At first came the French (Quesnay, Turgot and other Physiocrats) with the idea of laissez-faire, which was implicitly contesting Mandeville’s dilemma as it were implying that what is natural cannot be morally repugnant.10 Then came Scottish Enlightenment with Hutcheson and Hume suggesting that benevolence is, in fact, a natural trait of human behaviour and therefore, there cannot be anything intrinsically wrong in letting people do what they want. Ferguson (1996) went even further by suggesting some kind of “unintended consequences” that will emerge from such ethical behaviour (see Graham, 2013: 517). Adam Smith and John Stuart Mill are, perhaps, the great exception here even though the way in which they are understood by modern economics – and many scholars – makes them part of this one-directional analysis. Adam Smith is perceived by many as someone who had resolved Mandeville’s paradox by demonstrating that the motive behind the generation of plenty is not really selfishness but rather the more benign idea of self-interest or the prudent pursuit of one’s interest. So much so that modern economics sees in Adam Smith the intellectual origins of the idea of an order where not only do we maximise material plenty but we also end up with a coordinated outcome where everyone gets from society that which they have reason to expect. Again, this is a onedirectional analysis from the individual to the outcome and where that which constitutes the moral good is immovable in the face of social interactions. Modern economics has gone one step further by adopting the position of ethical neutrality. As such, economic analysis exempted itself from considering the ethical implications of economic interactions that meant, among other things, that economic outcomes will have no influence on either the behaviour or the moral principles by which individuals evaluate human interactions and outcomes. Ethics too has not fared better. Most ethical theories have adopted endogenisation only in the sense of searching for the origin of that which constitutes the morally good in the individual. There is some degree of interactions in Hutcheson (1728) where the moral sense is given but one needs reason to find the way in which one can act in a way that will benefit the others. This, in turn, may be different in different stages of social development, but it is not the ethical notion of benefitting the other (a form of benevolence) that is responsive to social circumstances, only its

196  Amos Witztum application. The absence of ethics in the recursive social system became even more pronounced with the rise of Utilitarianism. More recently, even the Rawlsian attempt at resuscitating moral theory from the linguistic trap followed the same principle: we find out what individual would deem as morally good (in this case, just) and this will be unaffected by social circumstances or outcomes. So, what is so special about Smith’s social theory that suggests that he has properly incorporated the principle of endogenisation? The simple answer is that there are two main reasons for this. The first is that the principle in human nature that lies behind the way in which people form moral opinions is closely associated with the principle in human nature that is the cause of the division of labour and Smith’s entire conception of economic systems. The second reason is that given the nature of this principle, the way in which it is used by humans depends both on their character and circumstances. Consequently, morality and economics are closely intertwined, which makes the reading of Smith much clearer. On the one hand, it allows us to understand the differences that exist between Smith the commentator and that which he observes in the world. This is particularly important given the empiricist tendencies of Smith’s epistemology. On the other hand, it also allows us to understand how it becomes possible for a system that he expressively decreed as inferior to be considered by people within it as a manifestation of moral goodness.

2 The unity of explanation and the duality of manifestation Smith’s works have been greatly misunderstood or understood very differently. Rothschild (1992) records that immediately after his death, he was first cited by those who were in favour of the poor’s laws and within a decade, it was the opposition to it that was citing his work. Soon after, das Adam Smith Problem developed when (mainly) German scholars felt that there was a contradiction between the premise of his two major works. We know that there could not have been a contradiction as Smith himself edited the sixth edition of TMS to be published around the time of WN. The accepted resolution of the problem implied that the two books offered different, yet compatible, principles in human nature. TMS dealt with the capacity humans have to feel sympathy while WN explored the motive of self-interest. Neither of these principles excludes the other yet; they do not seem to be influenced by one another. This, in the end, led to the conclusion that Smith’s message was that natural liberty works in a world where people behave ethically.11 What is meant by this is not any kind of specific morality but simply that people can be self-interested or prudent in their pursuit of their own regard while being able to feel sympathy with another as part of their other-regarding

Endogenous ethics  197 faculty. In other words, to generate a solution to the problem, there has been an implicit acceptance that the domains of economics and ethics are separable. Yet, while this may offer a solution to the question of conflicting premises, it does not resolve Smith’s numerous reservations about the moral dimensions of commercial society (see, for instance, Viner, 1927; Meek, 1977; Griswold, 1999). Evidently, the key for the resolution of das Adam Smith Problem relied on accepting that sympathy and self-interest are different and unrelated dimensions of human character. If so, Smith indeed offered a onedirectional theory of both economic and ethics, and in this respect, he has not really contributed to the endogenisation of explanations more than anyone else. But this, in my view, is a seriously flawed way of reading Smith’s works that leaves a considerable amount of confusion with regard to the nature of his message (or theory). To counter this view, I argue that while sympathy and self-interest may reflect different aspects of human nature, Smith was committed to the unity of nature, and this also means the unity of human nature. Therefore, not only is there a connection between what motivates people – even in the pursuit of their own direct interests – and the way in which they form moral judgement but also, and this is even more important, there is a connection between the circumstances that their behaviour creates and the way they behave and morally judge. Both the unity of human nature and of nature in general can be derived from Smith’s writings (albeit unpublished) on methodology. From LRBL, we learn that we can extract the theoretical structure of Smith’s writings from the form of exposition. It becomes fairly evident that both TMS and WN are written according to the Newtonian method, which means that the principle behind the theory is laid out at the beginning. In the case of TMS, this seems to be sympathy, while behind WN, it is really the division of labour or the tendency to barter and exchange. But we can also learn from it about the way he conceived things like human character. I have explored this at length (see Witztum, 1998) but it is quite clear that while one can say that each of these theories explore a different aspect of human character, there must be something that binds them together. But there is a more direct call for unity that we can derive from his EPS. In spite of the emphasis that is given to AL due to its more accurate account, the other essays are equally important for an understanding of the way in which Smith conceived the world. Not surprisingly, we find in it two important propositions that are significant to the understanding of Smith’s writings. The first is the one with regard to the unity of all theories. In AL, Smith defines the three elements of a scientific theory: a

it must have a principle that will unify all those apparently irregular phenomena;

198  Amos Witztum b it must be a simple system that would put our mind at ease; c it must be based on familiar qualities.12 The need for these three elements increases even further when we move from theorising about that which appears to be simple (the sky above), to the far more perplexing and confusing life on earth (AP, 1: 106). As both the world of social interactions and ethics as well as the world of economic interactions are part of the same strata that requires a simple, familiar and unifying principle that will put our mind at ease, there must be something for which both sympathy and the tendency to barter and exchange constitute different expressions. The second important proposition that is useful to the understanding of Smith’s writings is that while on the face of it Smith is clearly an empiricist, a closer look at his thoughts suggests a more complex way of thinking. This means that Smith draws a distinction between the world of universals and the specifics – or appearances – of the world (see AL, 1: 118–20). The reason this distinction matters is because it will allow us to explain the divergence between that which should be and that which is.13 Namely, when we talk about a recursive social system (endogenised ethics), we do not necessarily mean that the principles of how ethics should be conducted change but rather how the reality of their expression materialises. To be specific, and I will explain this further below, people who may end up judging by utility (in the Smithian sense) do not do so because they think that utility is the criterion of morality but rather because of the corruption of the principle of sympathy. Thus, when Smith is disparaging of public opinion, it is because of the corrupting effects of the recursive system and not because of a change in the way people really think that they should judge. This distinction between universals and substance appears to be in complete accordance with what is suggested in the History of Astronomy (HA, II.2–3: 38–9). Namely, that there is a need to classify matter according to familiar qualities. The only addition here is that we must analyse these qualities separately. Metaphysics, for Smith, the Theory of Universals, is a theory, the domain of which is not the matter itself but its classification.14 This does not mean that there is no connection between the different theories or that the universals are based on some a-priori notion. Even in Hume, we can find assertions of the following type: I must distinguish in the imagination betwixt the principles which are permanent, irresistable, and universal […]. And the principles, which are changeable, weak, and irregular […]. (Hume, 1888 [I.iv]: 225)

Endogenous ethics  199 That is to say that we have, in fact, two distinct levels of analysis. In each of them, there are principles, the role of which is to connect the different phenomena. The rules that are derived from them may be permanent in character, or temporary. Clearly, it will be the domain of the temporary where the recursive nature of the social system will be most significant.

3 What lies behind sympathy? A universal principle of relative morality So, how does the search for a unifying principle and the distinction between what Smith call the theory and the practice of morality present themselves in his analysis and how do they give rise to a genuinely endogenous theory of ethics? The principle behind Smith’s ethics (and social theory) is generally accepted as the principle of sympathy. However, the way in which it is expressed – following his Newtonian method – is somewhat different. He says, in the opening statement that no matter how selfish a person may be supposed: “there are evidently some principles in [man’s] nature, which interest him in the fortune of others” (TMS, I.i.1.1: 9). Namely, the principle is not really sympathy as such, but the interest people have in the others. Nevertheless, it is true that the most immediate expression of this interest, according to Smith, is the tendency to feel as others would, had one been in their position (i.e., sympathy). But I emphasise here that sympathy is not the principle as it is the expression of the interest that people have in the others. It is also important to note that already in observing the interest in the others as the foundational principle – which we will show to also stand behind the WN – the universal is open to very different practices, depending on the nature of this interest that in itself, is bound to be influenced by individual character and the way in which it is affected by circumstances and outcomes. Having declared the foundational principle, Smith continues to say that it is on the tendency to identify with the sentiments of the other that we form a moral opinion. This means that while interest in the others is an underlying principle, it is nevertheless its expression as sympathy that is the foundation of ethics. However, Smith then notes that we morally approve, or disapprove, of anything according to whether sympathy – identifying with the sentiments of another – invokes harmony of sentiments, or dissonance. But it is not upon the mere harmony (or dissonance) that we morally approve or disapprove. It is upon the pleasure we have in finding such a coincidence of sentiments with someone else. Nevertheless, these pleasant, or unpleasant, feelings, do not reflect the simple sense of pleasure like the one derived from utility (in its Benthamite sense).15 Instead, it is a much more complex notion of pleasure. In fact, it comprises two different sorts of pleasures. First, the

200  Amos Witztum pleasure we derive from realising that we would have felt the same as another, had we been in his place: nothing pleases us more than to observe in other men a fellowfeeling with all the emotions of our own breast; nor are we ever so much shocked as by the appearance of the contrary. (TMS, I.i.2.1: 13) And the important feature of this sort of pleasure is that it is independent of the nature of sentiment in question. Namely, that the pleasure we gain from realising that we would have felt the same as the subject of approbation in case of a pleasant sentiment, is the same as the one we would have experienced in the case of an unpleasant sentiment. The second aspect of the pleasure of harmony, on the other hand, depends on the nature of sentiment in question as well as on the observer’s disposition towards the other. Given that “interest in the fortune of others” does not necessarily mean a positive, or benevolent, interest, the consequences for actual moral judgement become unclear. Thus, the other’s sorrow, or joy, gives rise to pleasure or pain according to whether or not we have a positive or negative interest in their fortune.16 In the end, it is the combination of these two types of pleasure that formulate the actual judgement. However, this does not mean that there is no benchmark for what the moral judgement should be if the idea of sympathy were properly executed. This is the domain of theory as opposed to the practice of morality. According to Smith, people are aware of the difficulty in entering into another person’s position as their own character, as we have just argued, intrudes on them. Yet, what they consciously are trying to achieve is not their subjective judgement but the right judgement that would come about when they can contemplate what an impartial spectator would feel had he been in the position of the subject of approbation. This idea of the impartial spectator constitutes the main building block of the theory of ethics. Quite a lot has been made about the impartial spectator being the man within: one’s conscience. But the truth seems to me to be different not in the sense that one’s conscience should not be guided by the impartial spectator but that the impartial spectator is not guided by a sentimental conscience as it is by reason. Recall that the entire first part of the TMS is actually devoted to the analysis of actions and the principle of propriety. It is not about the nature of virtue. So, to properly understand the role and meaning of the impartial spectator, we have to ask ourselves how this would work when we analyse an action. In general, the action cycle has an actor – whose action is the result of the sentiments invoked in him due to circumstances – who chooses an action that has effects on another in whom a sense of gratitude or resentment is invoked (again, given this person’s

Endogenous ethics  201 circumstances). I have discussed the moral evaluation of this cycle in details elsewhere (Witztum, 2008), but I would like to concentrate on the key term that Smith uses for moral approbation. It is the notion of “suitability”: In the suitableness or unsuitableness, in the proportion or disproportion which the affection seems to bear to the cause or object which excites it, consist the propriety or impropriety, the decency or ungratefulness of the consequent action. (TMS, I.i.3.6: 18) And, as far as the action is concerned: Before any thing, therefore, can be the complete and proper object, either of gratitude or resentment, it must possess three different qualifications […] it must not only have produced those sensations, but it must have produced them from design, and from a design that is approved of in the one case, and disapproved of in the other. (TMS, II.iii.1.6: 96, italics added) So, how can suitability of sentiments that are invoked in an actor (by circumstances or as a result of being affected by another’s action) or the design of an action be determined? The answer is, of course, through the impartial spectator. Would he had felt as the actor does, given the circumstances? Would he have chosen the same action? And, of course, who is he? As each observer’s own character interferes in the judgement, the idea of the impartial spectator is basically to strip away individuals’ characteristics. This can be done through a notion of an average, or abstract, individual or through another question of what would have happened if everyone acted this way. Namely, if I choose to act A intending to benefit another and I know that if everyone acted A, then the outcome will be the exact opposite, then no impartial spectator would approve of this action. In other words, the “impartial observer” must examine whether allowing a free transformation of such sentiments into such actions may prove dangerous to society as a whole. For instance, in the case of resentment and hate, Smith believes that an “impartial spectator” may feel “sympathy” with the subject of approbation (i.e., everyone would have felt the same). Nevertheless, as far as transforming this hate, or resentment, into a harming action is concerned, Smith is quite adamant. “There can be no proper motive for hurting our neighbour [...] which mankind will go along with” (TMS, II.ii.2.1: 82). Namely, although we may approve of someone’s feelings in certain circumstances, we confront, all of a sudden, a sort of a Kantian “categorical imperative.” It is a kind of “categorical imperative” because the reason Smith believes that an “impartial spectator” will never consider

202  Amos Witztum a harmful action as suitable to the approved resentment, is its “universal test”. “Society” writes Smith “cannot subsist among those who are at all times ready to hurt and injure one another” (TMS, II.ii.3.3: 86). Obviously, the reason for rejecting the harmful action is not the absence of suitability between it and the resentment or hate behind it, but rather, its global significance. If everyone would act in such a way habitually (at all times), society could not subsist. The difference between Smith and Kant is that for Smith, the idea of the impartial spectator and the way to form the theory (or, pure, as opposed to practice) of morality is derived from what he observes in what people do, while in Kant this is a logical construct. In Smith too, there is a logical or rationalist element in it as the impartial spectator is some kind of a logical limit and not necessarily what people are capable of knowing by themselves. But it is still derived from that which he observes. Now, the way this impartially works – as well as the universal test in Kant – opens the door for some immediate relativity not necessarily in the practice of ethics as it is in its theory. The answer to the question of what would happen if everyone acted, say A, is not necessarily universal and may depend on social circumstances. Kant does not consider this as he does not really have a complete social theory, but as Smith did have a social theory, he was very much aware of the possibility that what the impartial spectator may approve at different stages of social development may not be the same thing. For instance, in Smith’s discussion of justice, he draws the attention (in the LJ) to the possibility that theft may not be considered a violation of justice in a world where there is no private property.17 This means that we already have a significant endogeneity in Smith’s analysis that presents itself at the theoretical level rather than the practical one where circumstances influence people. Here, the universal principle of ethics produces socially dependent moral values. To some extent, this is also reminiscent of Hutcheson (1728) who considered the role of reason to be the means for learning what it is that benefits the others.

4 Circumstances and the corruption and practice of morality Having established that the principle behind sympathy – and thus, moral judgement – is the interest people have in the other; we must now show the unity of the system by claiming that the division of labour, or the tendency to barter and exchange, which is the Newtonian method principle behind WN is also, as a matter of fact, a reflection of the interest people have in the other. There cannot be any doubt that the principle behind WN is that of the division of labour. However, unlike modern economics, in Smith, specialisation and trade are the natural result of

Endogenous ethics  203 human propensity to truck, barter and exchange and under no consideration, the result of rational choice. “We cannot imagine” writes Smith about the division of labour “[for it] to be an effect of human prudence” (LJB, 218: 492). Nor is it, according to Smith, because of the differences in people’s abilities: “This disposition to barter,” he claims, “is by no means founded upon different genius and talents” (LJB, 220: 493). Instead, “[t]he real foundation of it is that principle to perswade” (LJB, 221: 493). But what is this principle of persuasion if not the equivalent of the principle behind sympathy. Attempting to persuade someone of one’s own position is another expression of the search for harmony with the others. Evidently, we search for harmony because we are interested in the other; because it is our most fundamental social sentiment. So, how do we get from a simple desire to persuade and find harmony with others with regard to the division of labour? The answer is embedded in the way in which the principle of interest in the other manifests itself in the motive to act. Often Smith refers to one fundamental motive in human action and it is the desire to better our condition. The places where such references are made are numerous – and it is seen by modern economists as the equivalent of utility maximisation – but the meaning of it is not really the improvement of our physical conditions: From whence, then, arises that emulation which runs through all the different ranks of men, and what are the advantages which we propose by that great purpose of human life which we call bettering our condition? To be observed, to be attended to, to be taken notice of with sympathy, complacency, and approbation, are all the advantages which we can propose to derive from it. (TMS, I.iii.2.1: 50) In other words, the main driving force behind individual behaviour, according to Smith, is the search for social approbation. This, of course, is perfectly consistent with the general principle of the interest people have in the other and it is also consistent with the search for harmony through both sympathy and persuasion. But how does the search for social approbation through persuasion and the subsequent tendency to barter and exchange become the division of labour that lies at the heart of the WN. Moreover, the recursive question – the one that will highlight the endogeneity of Smith’s analysis – would be focused on how the division of labour relates to the desire to be socially approved and how it can go out of hand. The answer to the first question can be quite elaborate and is derived from Smith’s evolutionary approach18 to the development of society.19 In an early stage of social development when individuals are responsible for their own subsistence, people may find that they are better in doing one thing rather than another. 20 Hence, if one finds it easy to forge an arrow from

204  Amos Witztum wood, he can easily make plenty of them and bestow some as presents on another. In return, and for exactly the same reason, he would receive as presents those things, which the other has acquired, above their needs for subsistence. There are two results from this process. One intended and the other unintended. The intended one is that through gifts and the process of exchange individuals will acquire the social approbation they seek. The unintended consequence is that people will realise that by exchanging their surpluses, they can actually acquire a great deal more than if they alone tried to fulfil their needs directly from nature. 21 However, the moment people become dependent on others for their subsistence, they cannot really rely on gifts and friends alone to satisfy all their needs. It means that once people realise that they can use the surplus above their need of that thing in which they specialise, not only to connect with others but also to provide for all their needs, they become increasingly dependent on others who may not be their immediate friends. In other words, they become dependent on others with whom their social distance is somewhat greater. Indeed, Smith is quite clear that the exchange of gifts – or the specialisation, which is motivated by the desire to persuade – would not be sufficient to supply us with our needs. “In civilized society,” he writes, man “stands at all times in need of the co-operation and assistance of great multitudes, while his whole life is scarce sufficient to gain the friendship of a few persons” (WN, I.ii.2: 26). The question that arises is what happens when the social distance between those with whom one is engaged to acquire life’s necessity through exchange becomes great. The tendency to feel as others would, had one been in their position (i.e., sympathy) becomes far more difficult to materialise. Recall that for a proper process of moral evaluation, we must be able to understand the circumstances of the others. The further they are, socially, the less able we are to do so. Indeed, Smith himself discusses at length the dependency of sympathy on social distance and concludes that sympathy is unlikely to be used as a means for social approbation as social distance within the group on which one depends becomes great. This, of course, does not mean that people will not form moral opinions or will lose their interest in the others. If we bear in mind that the meaning of the interest in the other and the subsequent moral evaluation was based on the pleasure of harmony that a coincidence of sentiments generates, then the question is whether there is another source of such harmony that may, potentially, become a substitute to sympathy. The answer is in the affirmative and the origin of this is Smith’s notion of utility. Utility, in Smith, is the sense of pleasure we derive from seeing, or conceiving, things that are harmonious. Therefore, he suggests that it is quite possible to confuse interest in the others and its expected pleasure of harmony with the “utility” of things or systems. Smith claims that we

Endogenous ethics  205 are sometimes “eager to promote the happiness of our fellow-creatures” (genuine interest in the others) “from a view to perfect and improve a certain beautiful and orderly system” (aesthetic-based pleasure of harmony) rather than from care to what has befallen them (TMS, IV.1.11: 185). Put differently, people can be so impressed by the beauty of, say, a system, that they will believe that it must be morally good. The implications of this for the ethical dimension of Smith’s works are considerable. It means that, first of all, there are, in practice, competing methods of moral evaluation: “sympathy” and “utility.” Though Smith clearly considered the coincidence of sentiments – through an impartial spectator – as the right (theoretical)22 way of forming moral judgement (TMS, IV.2.3: 188), the practice of moral approbation is very different indeed. He even goes as far as to suggest that where “sympathy” dominates, the more likely political system will be hierarchical (monarchy) and where “utility” dominates, it is more likely to be or a republican nature (LJB, 12–15: 401–3). The question that arises is what is it that leads to this corruption of moral sentiments. There are, in principle, two answers. The first is that the tendency to employ sympathy depends on the strength of one’s interest in the other. The fact that individuals have an innate interest in the other does not necessarily mean that the level of this interest is equally shared. When Smith analyses human character, he distinguishes between the own-regarding and other-regarding categories. All individuals have both, but they are manifested differently in them. Employing Smith’s methodological search for unity, we can see that the way in which people pursue their own interests (own-regarding) is closely connected to the way in which they will behave in their other-regarding capacity. Thus, the person who is behind the WN may not be selfish but his, or her, interest in the other will be moderate relative to a person that could be called benevolent. As judging by means of sympathy requires a considerable amount of effort to put oneself in the position of another, the tendency to do so could therefore be dependent on human character. Why go through such efforts to try to understand the circumstances of another to achieve the pleasure of harmony if one’s interest in them is limited and where there is another way, much less demanding to acquire a sense of pleasure from harmony (utility)? It is therefore not at all surprising that Smith distinguishes between three social states. As individuals are always in need of each other’s assistance, the question is how such an assistant is provided. When it is provided out of benevolence and a genuine desire to help the other, society will flourish and be happy. When such assistance is provided in a mercenary fashion out of self-interest, society may subsist but in a very unhappy state (TMS, II.ii.3.2: 85–6). The third state is that in which individuals are willing to harm one another and is an unsustainable social situation.

206  Amos Witztum One way of explaining the difference between the two viable states is through the way in which people form their moral opinion about social states. In the case of benevolent individuals, they are more likely to employ sympathy and genuinely approve of each other’s behaviour. But if they are self-interested with a limited interest in the other, they may opt for utility as an easier replacement for the pleasure of harmony and therefore conclude that the system is morally good just because it generates wealth and is a well-contrived machine. The reason why Smith considers this an unhappy state is because the reason why the people in the system may be content with it is a corrupt reason that they would immediately recognise once they put their mind and conscience to it. But there is another, more powerful, reason why morality may become corrupted, and this is something that would be relevant whatever is one’s character. It is also the more relevant argument for the endogeneity of ethics as if the reason why morality becomes corrupt is based on human character, then one would need to show how characters evolve to demonstrate endogeneity and this is something that one cannot really find in Smith’s social theory. 23 The reason why morality may become corrupt endogenously is based on a combination of what Smith calls deception by nature and his own analysis of social evolution and his ethical theory. The argument goes as follows: When people’s sympathy leads them to the exchange of gifts and the division of labour, they become dependent on an increasing number of individuals. This necessarily means that social distance would increase and therefore, people will become less able to understand the circumstances of another in order to be able to morally judge them or hope for them to approve of one’s own behaviour. This increase in social distance will lead, according to Smith, to the decline in the employment of sympathy. But as people are still interested in the others, seek the pleasure of harmony and social approbation, they will opt for an alternative way of achieving it: utility. Now, utility is not just the harmony of a well-contrived machine but also the beauty of things among them one may count as material wealth. Though it is in order to supply the necessities and conveniences of the body, that the advantages of external fortune are originally recommended to us, yet we cannot live long in the world without perceiving that the respect of our equals, our credit and rank in the society we live in, depend very much upon the degree in which we possess [...] those advantages. The desire of becoming the proper objects of this respect, of deserving and obtaining this credit and rank among our equals, is, perhaps, the strongest of all our desires […]. (TMS, VI.i.3: 212–3) But how can wealth accumulation fulfil our social desires given that, as Smith the observer argues, it is at the “highest degree contemptible

Endogenous ethics  207 and trifling” (TMS, IV.1.9: 183)? The answer is that nature has created a deception – through the pleasure of harmony derived from utility – so that it will appear more favourable. [W]e rarely view [wealth] – writes Smith – in this abstract and philosophical light. We naturally confound it in our imagination with the order, the regular and harmonious movement of the system, the machine or œconomy by means of which it is produced. The pleasures of wealth and greatness, when considered in this complex view, strike the imagination as something grand and beautiful and noble, of which the attainment is well worth all the toil and anxiety which we are so apt to bestow upon it. And it is well that nature imposes upon us in this manner. It is this deception which rouses and keeps in continual motion the industry of mankind. (TMS, IV.1.9–10: 183, italics added). In other words, when society expands and social distance increases, our social relations – and morality – become commodified. Through consumption and the accumulation of wealth, we are able to acquire social approbation and the pleasure of harmony that is derived from the beauty of wealth and the machine that produces it (note, without guidance as we are discussing a natural order). However, if we need more commodities to acquire social approbation, the division of labour will have to be intensified. As this happens, we become dependent on even a greater number of individuals and therefore, social distance will increase further. As it does, the ability to use sympathy in our relationships with increasing number of individuals is diminishing while the attractiveness of utility increases. Together with nature’s deception, we then repeat this cycle as we deepen the level of social alienation, increase the role of commodity in social approbation and offend the basic principles of morality that emanate from our original desire to find harmony of sentiments.

5 Conclusion I have endeavoured to show how Smith’s analysis offers a theory of ethics that is genuinely endogenous. Apart from being thus loyal to the purpose of the Enlightenment, it helps to understand how it can be possible for a society to become trapped in a corrupt sense of morality where social relationships have been commodified and the sense of moral goodness comes from a false sense of harmony. The significance of such insights into contemporary debates about economic and social institutions cannot be overstated. One thing is clear, had John Locke known this, the foundations of liberalism would not have been what they have become.

208  Amos Witztum

Notes 1 Kepler, Copernicus, Galileo and Newton represent the evolution of this process in the natural (non-biological) sciences. 2 Hobbes (Leviathan) and Locke (Two Treatises of Government) could be considered as the beginning of endogenous analysis in the sphere of social sciences and political philosophy. 3 This, of course, is particularly true in the world of mechanics but even when we take thermodynamics into account where changes may follow, the consequences of interactions (say, as a result of a rise in entropy and temperature), the particles still have no expectations and do not, so to speak, behave in a particular manner because they expect specific outcomes. As far as living organisms are concerned, evolution does reflect changes in behaviour, and even properties, that are due to changes in the environment. Nevertheless, the ‘expectations’ of those organisms – their survival – remain unchanged. 4 This had led Lachmann to doubt the scientific nature of social subjects like economics: “Given […] the natural proclivity of every science to become more limited in scope as it grows more conscious of its premises” (1943: 12, italics added). 5 Broadly speaking, I am referring here to a combination of free will and the ability to act in a way that is guided by reason rather than by natural instinct. While this is not a direct reference to the Kantian notion of being able to act on universal rules of reason while overriding the rules of nature (see Kant, 1964: 98–9), it is not so far off it. 6 On the connection between expectations and behaviour, see Witztum, 2021. 7 It is not simple to ascertain Mandeville’s real intention who in addition to the Fable also wrote An Enquiry into the Origins of Moral Virtues. His position between the Deists – who saw no contradiction between experience, reason and God – and the Sceptics of his time has not been well established. See, for instance, H. Munro (1975) as well as the introductory comments on Mandeville’s thought by F.B. Kaye in his edition of The Fable of the Bees (Mandeville, 1988). 8 Naturally, the German Historical School (with its English offshoots) or scholars like Comte do not fit into this story as they rejected any separation between social spheres. However, as their influence on the developments of both Economics and ethics in Western thinking had been limited, I exclude them from my discussion. Another reason for doing this is that I feel that the reply which J.S. Mill gave to people like Comte also justifies this exclusion. 9 While it is true that in modern economics, there is considerable amount of learning (the first type of feedback to which I referred earlier), this is not really proper feedback because it does not really lead to a change in behaviour that is due to deeper changes in human character or understanding. Simply to learn that one strategy is better than another while maintaining the same objectives and value is a very limited and perhaps even insignificant form of feedback. 10 The moral position of the Physiocrats is some kind of a combination between Locke’s position about natural rights and property and a utilitarian view of the purpose of nature. See discussion in Albaum, 1955. 11 See, for instance, Evensky, 1993: 396. There have been discussions about the effects of natural liberty on the social stock but not to the extent that it would yield a change (see Rosenberg, 1990; West, 1996). 12 These characteristics are put forward in Sections I & II in the History of Astronomy (HA, I-II: 34–47).

Endogenous ethics  209 13 To some extent, Smith defies Hume by demonstrating a form of extracting an ought from an is. Due to space limitation, I will leave this important point open. 14 In the account of Smith’s life given by Dugald Steward, who was helped by one of Smith’s students, John Millar, he describes the convention of moral philosophy at that time to be: “The science of Ethics has been divided by modern writers into two parts; the one comprehending the theory of Morals, and the other its practical doctrines” (Life, II.1: 278). 15 The differences between the use of the term utility and pleasure in Smith and Bentham are discussed at length in Witztum and Young, 2013. The main point is that pleasure here is that unlike Utilitarianism, it is not a motive to act. 16 Smith has a long discussion about how envy may affect the way we interpret sorrow or joy in the other. The presence or absence of envy will suggest something about the kind of interest that individuals have in others. 17 I discuss Smith’s theory of Justice in Witztum, 1997, 2005. 18 Which he shared with Turgot. 19 A systematic treatment of this with the required textual support can be found in Witztum, 2010. 20 Though the early stage in Smith is the age of hunter-gatherers where there was already some degree of division of labour, this seems to be depicting an even earlier stage though it could also apply to the hunter-gatherers’ stage with limited social division of labour (as opposed to individual division of labour). 21 “By this disposition to barter and exchange the surplus of ones labour for that of other people […] he will live better than before and will have no occasion to provide for himself, as the surplus of his own labour does it more effectually”(LJB, 220: 493). 22 Something with which all will agree if were presented to them in this way as it corresponds to the natural way of forming a moral judgement. 23 It is, of course, in Mill with his “Ethology,” or theory of “character formation.”

References Albaum, M., 1955 “The Moral Defenses of the Physiocrats’ Laissez-Faire”, Journal of the History of Ideas, vol. 16, no. 2, pp. 179–97. Evensky, J., 1993, “Adam Smith on the Human Foundation of a Successful Liberal Society”, History of Political Economy, vol. 25, no. 3, pp. 395–412. Ferguson, A., 1996, An Essay on the History of Civil Society [1767], ed. F. Oz-Salzberger, Cambridge University Press, Cambridge. Graham, G., 2013, “Adam Ferguson as a Moral Philosopher”, Philosophy, vol. 88, no. 4, pp. 511–25. Griswold, C.L., 1999, Adam Smith and the Virtues of Enlightenment, Cambridge University Press, Cambridge. Hume, D., 1888, A Treatise of Human Nature [1739–1740], ed. L.A. SelbyBigge, Clarendon Press, Oxford. Hutcheson, F., 1728, An Essay on the Nature and Conduct of the Passions and Affections, J. Darby & T. Browne, London. Kant, I., 1964, Groundwork of the Metaphysic of Morals [1785], ed. H.J. Paton, Harper and Row, New York.

210  Amos Witztum Lachmann, L.M., 1943, “The Role of Expectations in Economics as a Social Science”, Economica, vol. 10, no. 37, pp. 12–23. Mandeville, B. de, 1988, The Fable of the Bees: or, Private Vices, Publick Benefits [1714–1732], With a Commentary Critical, Historical, and Explanatory by F.B. Kaye [1924], Liberty Fund, Indianapolis, IN, 2 vols. Meek, R.L., 1977, Smith, Marx, and After: Ten Essays in the Development of Economic Thought, Chapman & Hall, London. Munro, H., 1975, The Ambivalence of Bernard Mandeville, Clarendon Press, Oxford. Rosenberg, N., 1990, “Adam Smith and the Stock of Moral Capital”, History of Political Economy, vol. 22, no. 1, pp. 1–18. Rothschild, E., 1992, “Adam Smith and Conservative Economics”, Economic History Review, vol. 65, no. 1, pp. 74–96. Viner, J., 1927, “Adam Smith and Laissez Faire”, Journal of Political Economy, vol. 35, no. 2, pp. 198–232. West, E.G., 1996, “Adam Smith on the Cultural Effects of Specialization: Splenetics versus Economics”, History of Political Economy, vol. 28, no. 1, pp. 83–105. Witztum, A., 1997, “Distributive Considerations in Smith’s Conception of Economic Justice”, Economics and Philosophy, vol. 13, no. 2, pp. 242–59. ———, 1998, “A Study into Smith Conception of the Human Character: Das Adam Smith Problem Revisited”, History of Political Economy, vol. 30, no.3, pp. 489–513. ———, 2005, “Property Rights and the Rights of the Fruits of one’s Labor: A Note on Adam Smith’s Jurisprudence”, Economics and Philosophy, vol. 21, no. 2, pp. 279–89. ———, 2008 “Smith’s Theory of Actions and the Moral Significance of Unintended Consequences”,  The European Journal of the History of Economic Thought, vol. 15, no. 3, pp. 401–32. ———, 2010, “Interdependence, the Invisible Hand, and Equilibrium in Adam Smith”, History of Political Economy, vol. 42, no. 1, pp. 155–92. Witztum, A. & J.T. Young, 2013, “Utilitarianism and the Role of Utility in Adam Smith”, The European Journal of the History of Economic Thought, vol. 20, no. 4, pp. 572–602.

Theory and critique of commercial society

13 The poor man’s son Deception in Adam Smith’s case for free enterprise James R. Otteson

1 Introduction Adam Smith is often understood as a supporter of commercial society.1 His political economy presumed governmental enforcement of primarily justice, which he defines in his Theory of Moral Sentiments (TMS) as the protection of our persons, of our property and possessions, and of our voluntary agreements, contracts, and promises (TMS, II.ii.2.2: 84). In addition to protecting this conception of justice from both foreign and domestic aggression, Smith also advocated, in his Wealth of Nations (WN), that the government provide “certain publick works” that would meet both of two criteria: they would benefit substantially all members of society, not merely one person or one group at the expense of another; and they must be unable to be provided by private enterprise (WN, IV.ix.51: 687–8). Smith goes on to discuss some “publick works” that might satisfy these two perhaps surprisingly stringent criteria, including infrastructure and public education (WN, V.i.d-e: 724–58 and V.i.f-i: 758–816, respectively). In these discussions, however, Smith finds examples in which infrastructure, education, and even the administration of justice are provided privately and sometimes, he claims, with greater effectiveness than when they are undertaken by the state. 2 And he does not entertain possible “publick works” such as retirement benefits, healthcare, unemployment insurance, or wealth redistribution, which are central activities of many governments throughout the world today. Although his argument thus allows for the possibility of a larger, possibly welfare-state, government, the Smithian government would likely be quite small by today’s standards, giving prima facie support in favor of understanding Smith’s argument as supporting a broadly free-enterprise economic system. That is not to say that Smith advocates laissez-faire. The standard points against such an interpretation include Smith’s repeated concern for the poor, his allowance of government provision of “publick works” that do pass his two-pronged test, his discussion of the need for education, and his apparent defense of proportional taxation. These Smithian departures from laissez-faire are well catalogued.3

DOI: 10.4324/9781003301448-17

214  James R. Otteson There has, however, been relatively less scholarly attention paid to a parable that appears in Part IV of his TMS. This parable tells the story of a “poor man’s son, whom heaven in its anger has visited with ambition” (TMS, IV.1.8: 181).4 Smith tells us that this son is unsatisfied with the “too small” accommodations that his father is able to provide for him, and so he resolves to work to generate wealth sufficient to provide himself the accommodations he sees the rich enjoying and that he desires. Perhaps surprisingly, Smith claims that even if the poor man’s son is eventually able to achieve the wealth and its attendant accommodations he desired, it will turn out not to have repaid his efforts. This now-rich poor man’s son will himself, Smith claims, admit that it was not worth it. Is the lesson from Smith’s parable that we should not pursue wealth, or that we should not work hard to earn money to enable ourselves to live at “ease in a palace” (TMS, IV.1.8: 181)? That our goal should instead be the “tranquility” Smith extols in TMS but that seems out of place in – even inconsistent with – a drive for production, creation, and innovation on which a free-enterprise system seems to depend? Is the lesson that, as Justman puts it, “the poor man’s son should have stayed poor” (1993: 57)? This chapter addresses those questions in the following steps. The next section lays out Smith’s “poor man’s son” parable (PMSP) and the lessons Smith seems to draw from it. It also connects the PMSP to another passage in TMS where Smith seems to suggest a similar moral. The third section explores the moral lessons the PMSP seems to imply, as well as what these lessons would indicate for the moral status of Smith’s case for free enterprise. It also reviews the extent to which the PMSP comports with other claims Smith makes about a moral case for free enterprise. Section 4 reviews a handful of scholarly treatments the PMSP has received and argues that they do not resolve the central challenge of the parable. Section 5 proposes a resolution of the problem the parable poses and draws lessons about what the PMSP means for Smith’s case for commercial society. The sixth and final section concludes.

2  The parable Part IV of Smith’s TMS addresses “the Effect of Utility upon the Sentiment of Approbation.”5 David Hume had argued that utility formed the principal foundation of many, even most, of what we recognize as virtues. Smith is sympathetic to much of the Humean argument, though he argues that utility does not capture everything. In the first Chapter of Part IV, Smith argues that human beings also value “fitness,” or the “happy contrivance of any production of art” (TMS, IV.1.3: 179), in addition to its utility; indeed, we sometimes, Smith believes, value the “fitness” even more highly than the utility.

Deception in Adam Smith’s case for free enterprise  215 An example Smith offers to substantiate his claim is that people highly value accurate timepieces. “A watch […] that falls behind above two minutes in a day, is despised by one curious in watches” (TMS, IV.1.5: 180). This fact cannot be explained merely by utility, Smith argues, because there is little difference in utility between a watch that does not lose two minutes per day and one that does, and yet people “curious in watches” will value the former much more highly than they would a watch that does lose that much time per day. In any person’s actual life, losing two minutes of time per day can, Smith thinks, make no meaningful difference in utility: both watches would serve their owners’ utilitarian purposes roughly equally. Smith concludes there must therefore be something else for which people value watches beyond their utility of telling time. This conclusion leads him to explore the value that “lovers of toys” put on “baubles” and on “trinkets of frivolous utility” for which they are willing to pay handsome sums (TMS, IV.1.6: 180). He concludes with the following, which serves as the preface for his parable: Nor is it only with regard to such frivolous objects that our conduct is influenced by this principle [of valuing “fitness” and “happy contrivance of any production of art,” not its strict utility]; it is often the secret motive of the most serious and important pursuits of both private and public life. (TMS, IV.1.7: 181) This “principle” is immediately succeeded by Smith’s parable, which begins thus: “The poor man’s son, whom heaven in its anger has visited with ambition, when he begins to look around him, admires the condition of the rich” (TMS, IV.1.8: 181). Smith’s PMSP reports that the poor man’s son is unsatisfied by the accommodations his father is able to provide him. He resents the labor in which he is called to engage but that does not improve his accommodations, and he imagines he would be happier with a big house and servants at his beck and call. He imagines what his life would be like if he were rich and “is enchanted with the distant idea of this felicity” (TMS, IV.1.8: 181). He decides that to achieve this imagined state of felicity, he will have to work hard to earn more money, and he thereupon resolves to do so. Smith relates that the poor man’s son thus submits in the first year, nay in the first month of his application, to more fatigue of body and more uneasiness of mind than he could have suffered through the whole of his life from the want of them. He studies to distinguish himself in some laborious profession. (TMS, IV.1.8: 181)

216  James R. Otteson He hence engages in “unrelenting industry” and “labours night and day;” and he “solicits every opportunity of employment.” He realizes that in order to succeed he must also please others, and so he “makes his court [open] to all mankind,” and he even “serves those whom he hates, and is obsequious to those whom he despises” (TMS, IV.1.8: 181). At long last, after years of toil and ignominious flattery, he achieves his goal: he has attained the level of wealth he sought. Has he now finally attained the “felicity” he sought and for the sake of which he subjected himself to so much toil and labor? Smith’s answer is no: It is then, in the last dregs of life, his body wasted with toil and diseases, his mind galled and ruffled by the memory of a thousand injuries and disappointments which he imagines he has met with from the injustice of his enemies, or from the perfidy and ingratitude of his friends, that he begins at last to find that wealth and greatness are mere trinkets of frivolous utility, no more adapted for procuring ease of body or tranquillity of mind than the tweezer-cases of the lover of toys; and like them too, more troublesome to the person who carries them about with him than all the advantages they can afford him are commodious. (TMS, IV.1.8: 181) At the end of this process, Smith reports, the now-wealthy poor man’s son understands, finally, that all the years of toil and labor were not repaid by the utility they provided. In his heart he [now] curses ambition, and vainly regrets the ease and the indolence of youth, pleasures which are fled for ever, and which he has foolishly sacrificed for what, when he has got it, can afford him no real satisfaction. (TMS, IV.1.8: 182) Smith’s poor man’s son believed that attainment of wealth would provide him “more means of happiness” (TMS, IV.1.8: 182), which entails that his ultimate goal was indeed happiness, which Smith repeatedly equates with “ease” and “tranquility.”6 It turns out, however, that the cost – in time, labor, opportunity cost, and even humiliation – do not outweigh the benefit, and indeed pale by comparison. Yet he realizes this only too late, after he had devoted years to this end. And now his anguish and disappointment are compounded by several factors: the belated realization that he had in his hands from the outset the means of attaining the goals of “ease of body” and “tranquillity of mind” that he now has spent so many years vainly pursuing; the belated realization that he has

Deception in Adam Smith’s case for free enterprise  217 frittered his life away in this pointless pursuit; and the belated realization, upon finally procuring the accommodations he sought, that they appear then to be, what they are, enormous and operose machines contrived to produce a few trifling conveniencies to the body […] and which in spite of all our care are ready every moment to burst into pieces, and to crush in their ruins their unfortunate possessor. (TMS, IV.1.8: 182–3) Smith’s conclusion: If we consider the real satisfaction which all these things are capable of affording, by itself and separated from the beauty of that arrangement which is fitted to promote it, it will always appear in the highest degree contemptible and trifling. (TMS, IV.1.9: 183) It would be hard to overstate how negatively Smith portrays such a wasted life and how mistaken he believes people are who devote themselves to it. He continues at some length describing the “anxiety,” “fear,” and “sorrow” such people will experience; the risks of “diseases,” “danger,” and even “death” they run (TMS, IV.1.8: 183); and yet how “contemptible and trifling” their resulting achievements actually are (TMS, IV.1.9: 183). We might therefore expect that Smith would condemn such vain pursuits and counsel instead an appreciation of the “means of happiness” that he believes many, perhaps most, of us already possess; and that he would condemn a system of social expectations, and still more a system of political economy, that would encourage us in the fool’s errand of tireless pursuit of pointless wealth – even though both would seem at odds with what one might have expected from a putative “father of capitalism” (see Bassiry & Jones, 1993; Hühn & Dierksmeier, 2016). Before turning to the lessons Smith draws from this parable and the principles they imply, let us look at another passage in which Smith seems to paint a similar picture. In Part III of TMS, Smith discusses the development of our “conscience” (TMS, III.3: 134–56), and the process by which Smith thinks it emerges, gets honed by experience, and enables us to judge our own actions, sentiments, and judgments, not just those of others (see Otteson, 2013). Smith describes the virtue of “self-command,” which he argues enables us to discipline our conduct to heed the judgment of an imagined impartial spectator – what becomes for Smith our “conscience” (see Raphael, 2007). Smith’s discussion occasions an exploration of the Stoic view that “between one permanent situation and another, there was,

218  James R. Otteson with regard to real happiness, no essential difference” (TMS, III.3.30: 149). Though Smith departs from Stoic apatheia in some respects – he believes, for example, that parents should rightly be more concerned with their own children than with those of others (TMS, III.3.15: 143) and that suffering an injury or accident properly allows us to be unhappy (TMS, III.3.27: 147–8) – nevertheless Smith agrees with the Stoic ideal of happiness understood as “tranquility.” He goes so far as to claim: “The great source of both the misery and disorders of human life, seems to arise from over-rating the difference between one permanent situation and another” (TMS, III.3.31: 149). Smith here introduces an anecdote drawn from Plutarch about Pyrrhus, the king of Epirus. As Smith relates the story, Pyrrhus is expatiating to his adviser Cineas, whom Smith calls Pyrrhus’s “favourite,” “all the conquests which he proposed to make” (TMS, III.3.31: 150). At the conclusion of Pyrrhus’s list of proposed conquests, Cineas asks what the king imagines he would do then. “I propose then, said the King, to enjoy myself with my friends, and endeavour to be good company over a bottle.” To which Cineas perhaps impertinently replies: “And what hinders your Majesty from doing so now?” If happiness genuinely does consist in tranquility, the king already has that available to him – and he does not need to prosecute costly and bloody wars to achieve them. Smith’s moral of this anecdote: “you will find that the misfortunes of by far the greater part of them have arisen from their not knowing when they were well, when it was proper for them to sit still and to be contented” (TMS, III.3.31: 150).7 This anecdote seems to comport with Smith’s PMSP. In both cases, we have people who underestimate the contentment, tranquility, and thus happiness that is already within their reach, and who overestimate the happiness or utility that wealth or power will provide them. These two discussions suggest a skepticism of the ambition and drive that seem required in a commercial society, a prediction of ultimate disappointment for any who engage in a life of business and enterprise, and thus an author who might – especially as a moral philosopher, not an apologist for capitalism – be critical of a political economy that encourages industry and production and offers a mirage of reward for ceaseless striving for more. And yet Smith is routinely taken to be precisely such an apologist for commercial society, and not without reason: his WN consists largely, though not entirely, in defense of commerce and of trade and enterprise – and premises the argument on its ostensible benefits specifically to the “workman,” the “day-labourer,” and the “lowest ranks of the people” (WN, I.i.10: 22), who might well be ‘poor men’s sons.’ What, then, do Smith’s PMSP and the anecdote of Pyrrhus imply about how the Smith of TMS views the case for commercial society?

Deception in Adam Smith’s case for free enterprise  219

3  The moral of the parable The first thing to emphasize about the moral Smith draws from his PMSP is that the poor man’s son was deceived into thinking that riches would provide him happiness – and that it is good that he was so deceived. “And it is well that nature imposes upon us in this manner,” because “[i]t is this deception which rouses and keeps in continual motion the industry of mankind” (TMS, IV.1.10: 183). Smith recounts the benefits that people suffering from this “deception” provide the rest of us, including agricultural breakthroughs, building and construction, invention, and other goods, services, and activities that “ennoble and embellish human life” (TMS, IV.1.10: 183). Smith is making two claims here. First, it is precisely because people are deceived about the benefit to themselves that will accrue from their toil and labor that they nevertheless engage in it. But, second, though they themselves may not thereby enjoy a net increase in utility, the rest of us will: society is the primary beneficiary of their deluded labors. There are further moral implications of Smith’s argument. First, he appears to be endorsing the principle that it is morally acceptable for some of us to benefit at others’ expense. If we other members of society enjoy a net increase in utility from the activity of society’s poor men’s sons who do not themselves enjoy a net increase, if we claim that the benefit to us outweighs the loss to them, and if we endorse them being deceived into benefiting us, then we are endorsing the principle that it is acceptable – even, perhaps, praiseworthy – for us to benefit at their expense. Such a principle would seem to endorse treating others as mere means to our ends, rather than as ends in themselves. This principle might violate Smith’s own conception of justice. Smith had argued for a “negative” conception of justice (TMS, II.ii.1.9: 82), which consists primarily in refraining from injuring others in their persons, in their property or possessions, or in their voluntary contracts or promises. Smith called these three protections “sacred” (TMS, II.ii.2.2: 84), and he argued that a moral system of government entailed their protection whatever else it did and before it would engage in any acts of “beneficence” (TMS, II.ii.3: 85–91).8 Smith argues for this negative conception of justice for several reasons, including that it constitutes “the foundation which supports the building” of society, without which society “must in a moment crumble into atoms” (TMS, II.ii.3.4: 86). He defines this conception of justice as enjoining uninvited or unwelcome “harm” or “injury” to another; when one “does real and positive hurt to some particular persons,” one has worsened their position, thereby becoming “the proper object of resentment, and of punishment” (TMS, II.ii.1.5: 79). For that reason, injustice requires punishment or compensation, as appropriate.

220  James R. Otteson Yet Smith denies that a potential act of injustice could be justified by eventuating in a net increase in overall utility: To disturb [another’s] happiness merely because it stands in the way of our own, to take from him what is of real use to him merely because it may be of equal or of more use to us, or to indulge, in this manner, at the expence of other people, the natural preference which every man has for his own happiness above that of other people, is what no impartial spectator can go along with. (TMS, II.ii.2.1: 82) Thus, we may not benefit ourselves at others’ expense, even when doing so could potentially lead to an increase in net utility. The rest of society would not be stealing from or trespassing upon the property of the poor men’s sons, but the PMSP’s apparent endorsement of a ‘deceptive’ bargain by which society gains at their expense seems to violate the principle informing Smith’s conception of justice holding that we may not treat others as mere means to our own ends. Thus, Smith’s conception of justice would seem to condemn behavior that Smith himself recommends in his PMSP. A second implication of Smith’s PMSP seems to be that we should be actively complicit in the deception. If we benefit from their being deceived, and if it is good for society that they should be so deceived, then it seems to follow not only that their deception is itself good (it is justified by the good ends to which it leads) but also that we would be well-advised to do what we can to continue the deception. We should therefore not caution young and ambitious would-be entrepreneurs that the goals they aim to achieve will constitute a net loss to them, and we should not counsel them to appreciate the degree to which they already possess means to achieve the tranquility that is key to, or identical with, happiness. Perhaps we should even vividly portray for them all the gilded utility of a happiness at which their toil aims but will never reach. How does this affect Smith’s case for commercial society? Smith’s conception of justice undergirds a claim that a proper government’s main purpose is to protect justice – that it should be “negative,” remaining predominantly inactive except in cases of injustice. It would follow that the government should take little or no notice of disparities in wealth, should not engage in wealth redistribution even for beneficent ends, and should otherwise leave individuals free to produce, associate, transact, and trade with others as they see fit. But if that argument is based on the endorsement of deception, and if it entails, and indeed depends on, some knowingly and deceitfully benefiting at others’ expense, then the case not only seems inconsistent with Smith’s own conception of “sacred” justice but seems to endorse a morally unsavory principle in itself. How, then, could Smith endorse it? And how could we, who, thanks to Smith,

Deception in Adam Smith’s case for free enterprise  221 now understand the deception and the extractive nature of the benefit, continue to endorse it in good conscience? I believe we should not do so. If the case for commercial society depends on people being deceived into benefiting others at their own expense, then the moral case for commercial society fails. The injunction against extractively benefiting oneself at the expense of others turns on the immorality of treating others as mere means to our own ends. If others are, however, equal in moral agency to us – as Smith claims: “Though it may be true, therefore, that every individual, in his own breast, naturally prefers himself to all mankind,” nevertheless when “he views himself in the light in which he is conscious that others will view him, he sees that to them he is but one of the multitude in no respect better than any other in it” (TMS, II.ii.2.1: 83) – then extraction constitutes a violation of Smith’s moral egalitarianism (see Fleischacker, 1999; Herzog, 2013; Anderson, 2016). Assault and murder, theft and fraud, and breach of promise are “unjust” because they all involve, in different though related ways, the using of others as mere means to our ends and thus of disrespecting their equal moral agency. They involve treating others as if they were mere “trinkets” and “baubles” whose purpose is to gratify our vanity, or perhaps to conduce to our enjoyment of “fitness” to our ends.

4  The parable in the literature Charles Griswold claims it “is crucial to see that The Wealth of Nations, and so the world of wealth getting it promotes, is painted within this frame” articulated in the PMSP, and that the PMSP presents a “largescale mistake in our understanding of happiness” and thus constitutes what Griswold calls a “comic irony” (1999: 222). If Smith in WN is advocating a market economy and a “world of wealth getting,” then the PMSP might indeed be “ironic”; yet, it is not clear that it is “comic.” Perhaps “tragic” would be a better word to describe people being deceived into benefiting others at a net cost to themselves. Samuel Fleischacker disagrees that all of Smith’s WN should be “painted within [the] frame” of the PMSP: “If Griswold’s interpretation is right, Smith urges us throughout TMS to see the pursuit of wealth as morally corrupting and conducive to unhappiness, but also applauds a social system that depends upon, and encourages, that very pursuit” – a notion Fleischacker asserts “doesn’t make sense” (2004: 104). Fleischacker claims that Smith’s PMSP is discussing “not the desire that everyone has, merely to ‘better one’s condition,’” but, rather, the “desire for great wealth” (2004: 105); thus, Fleischacker argues that the poor man’s son’s aspiration to a “life of some superior rank of beings” (TMS, IV.1.8: 181) is a wish “to become super-human” and to live “beyond the human lot” (Fleischacker, 2004: 106). But Smith’s description of the aspirations of the poor man’s

222  James R. Otteson son does not portray them as “super-human.” They are, rather, aspirations to live as the wealthiest in his day already do. Smith claims that the poor man’s son’s deluded quest ensues “when he begins to look around him” and “admires the condition of the rich” (TMS, IV.1.8: 181) – that is, the condition of the rich he actually sees, not that of super-human beings he can only imagine. He “sees his superiors carried about in machines, and imagines that in one of these he could travel with less inconveniency” (TMS, IV.1.8: 181). The poor man’s son has high aspirations, but they issue from desiring what he sees with his own eyes. Fleischacker concedes that Smith “did continue to endorse [the PMSP’s] main insight – that the attractions of wealth and greatness lie less in their usefulness than in their apparent suitedness to accomplish useful ends,” but claims that this was merely “a rough first stab at bringing [Smith’s] moral philosophy to bear on economics, not a frame for all his economic thought” (2004: 108). Fleischacker might be right that this was merely a “rough first stab” on Smith’s part and that it was not intended as a “frame for all his economic thought” (2004: 108, italics added) – a claim that would provide a corrective to Griswold. Yet, the passage in TMS in which the PMSP occurs remained unchanged throughout all six of TMS’s editions published during Smith’s lifetime, so Smith had ample opportunity to revise or change it if his thinking had changed. Regardless, Fleischacker’s gloss on the PMSP does not address its core problematic, and the source of its power: we should (apparently) welcome the existence of our society’s poor men’s sons and embrace the deception that leads them to produce wealth from which we benefit, even if the toil and labor required for them to produce that wealth are not repaid to them by the utility of the “trinkets of frivolous utility” they procure with their wealth. Ryan Patrick Hanley calls Smith’s PMSP a “brilliant rhetorical set piece” that presents “the ostensible tragedy of commercial society: the desire of the poor man’s son to better his condition appears to be at once the condition necessary for collective social prosperity and the condition that guarantees his individual misery” (2009: 104–5). Hanley calls the story of the poor man’s son an “ironic tragedy” in which “his love of tranquility leads him to pursue his goal in a manner specifically inimical to the achievement of that goal” (104–5), yet Hanley argues that the point of the PMSP is to illustrate the dangers of improperly directed vanity: “if vanity can be neither avoided nor extirpated, the most prudent and effective strategy for its management is to direct it in such a way that its ambitions are harnessed to provide incentive for virtue” (107). For Hanley, the Smithian lesson is that we should counsel our poor men’s sons to develop the virtue of prudence, which would presumably entail making a dispassionate estimation of the likelihood that their efforts will achieve their goals, and then calibrating their efforts accordingly. Hanley’s advice regarding the virtue of prudence may be, as he suggests, a central part of what Smith believes proper “fatherhood” requires

Deception in Adam Smith’s case for free enterprise  223 instilling in children (2009: 106). But Smith speaks of the poor man’s son’s “ambition,” not his vanity. Moreover, the moral Hanley draws from Smith’s PMSP seems not to address the moral that Smith himself draws, namely, that we should welcome and even participate in the deception because the rest of us benefit from it. If Smith’s lesson from the PMSP were that good fathers should strive to develop proper prudence in their sons, then why would Smith have concluded the PMSP with his rousing endorsement of the many benefits society receives from deceived poor men’s sons? Hanley’s claim that Smith’s “advice to the father of a vain son” is that while vanity is “inevitable,” it is nevertheless morally “educable” (109) may be good parental advice, but it does not address either poor men’s sons’ ambition (not vanity) or the benefit Smith claims society receives from their ambition. Finally, Dennis Rasmussen suggests a reading that he claims “neatly solves the puzzle” of the PMSP by reconciling Smith’s advocacy of a commercial society with its ultimately not repaying those who toil in it. Rasmussen claims that the “main reason Smith advocates commerce and commercial society” is because “commerce paves the way toward ‘order and good government, and with them, the liberty and security of individuals’ ” (2008: 150; the quoted passage is from WN, III.iv.4: 412). He claims that Smith’s chief political-economical goal is the “happiness” of citizens, and that for Smith, the path to happiness lies principally in reducing misery, a chief cause of which is dependence on others (2008: 137–44). In commercial society, we become interdependent on one another, but not dependent on any particular other; we rely on others for goods and services, but we are not beholden to them the way we can be beholden to kings and lords, who can hold our fates in their hands. In a commercial society, Smith argues: Each tradesman or artificer derives his subsistence from the employment, not of one, but of a hundred or a thousand different customers. Though in some measure obliged to them all, therefore, he is not absolutely dependent upon any of them. (WN, III.iv.12: 420) Even the rich person is not a threat in a commercial society: Though he contributes, therefore, to the maintenance of them all [i.e., the workmen in the rich person’s employ], they are all more or less independent of him, because generally they can all be maintained without him. (WN, III.iv.11: 420) Rasmussen emphasizes Smith’s concern for independence, and Smith’s argument that it is in commercial societies that people’s, especially the

224  James R. Otteson poor’s, independence is enhanced. Rasmussen claims, moreover, that the alleviation of misery is a central concern for Smith, again especially the misery of the poor. Rasmussen’s argument would hold that, in Smith’s view, whatever deleterious consequences a commercial society might have are outweighed by the increase in independence – and thus the chance of achieving happiness – that people experience in such a society: on Smith’s view the key prerequisites for an individual to avoid misery – to attain a reasonable degree of tranquility and enjoyment – are a sense of relative safety and freedom from direct dependence on another individual. (Rasmussen, 2008: 139–40) Recall that the two main aspects of the PMSP are (1) the seeming use of others as mere means to our own happiness, and (2) the predictable diminishment in utility to those who engage in toil and labor because they are deceived into thinking it will increase their utility. Rasmussen’s argument addresses the first of these by proposing a tradeoff: yes, we treat you as a mere means to our happiness, but in return, you get increased independence, which is a key to alleviating misery and achieving your own happiness. This is a tradeoff we might expect people would willingly make, because the alternative is to lose both prosperity and independence. Smith believes that in commercial societies, we become interdependent on one another – as he illustrates, for example, in his recounting of all the people who play a role in bringing to the “day-labourer” the “woollen coat” he wears (WN, I.i.11: 22–4) – and that this interdependence provides a measure of independence unavailable to those who are beholden to the king or lord. Rasmussen portrays Smithian interdependence as the only realistic way to increase independence, especially for the poor. Hence, Rasmussen’s interpretation of Smith’s argument respects Smith’s concern for independence and provides a way to address the first aspect of the puzzle of the PMSP. The second aspect, however, remains. If it is true that in commercial society we are deceived into believing our toil and labor will be repaid in the end, when in fact it will not be – and those of us who have read and understood Smith’s PMSP know that it will not be – then we are endorsing a losing bargain for deceived others so that we can enjoy the fruits of their labor ourselves, which seems an immoral way to treat others who are our moral equals.

5  A possible resolution One way to avoid the problematic implications of the PMSP is to deny that people do not themselves benefit from the toil and labor in which

Deception in Adam Smith’s case for free enterprise  225 they engage. There are at least two reasons to believe Smith himself might deny this premise. First, as Fleischacker points out (2004: 104), much of Smith’s argument in WN requires its denial. That by itself does not prove there is no tension between the PMSP and Smith’s argument in WN, but it might give us reason to reconsider the moral of the PMSP. A further reason to believe Smith might deny the premise is that he repeatedly claims that people do benefit from commercial society, indirectly if not directly. The error identified in the PMSP, and hence the deception involved, lies in the mistaken belief that the trinkets one buys with one’s increasing wealth directly repay one in utility. That, Smith acknowledges, is a fool’s errand. But if one expands the scope of one’s consideration to account for (1) the benefit to oneself from living in a society in which many people similarly engage in toil and labor, and (2) the benefit to oneself from the knowledge that one’s toil and labor benefits others, then the balance, for Smith, tips in favor of the commercial society. As we have seen, Smith welcomed the benefits to the rest of us from the self-interested activities of people who toil and labor in markets. He believed that their activities would lead to increasing consumer surplus, and for him this justified welcoming their activities even if they did not directly repay those engaging in it. I suggested that such an argument seemed to involve an endorsement of benefiting ourselves at the expense of others, rendering Smith’s argument internally inconsistent. What could rescue Smith’s position, however, would be to claim that the deceived poor men’s sons in fact do benefit from their toil and labor – and do so sufficiently that it repays the disutility they experienced in their toil and labor. Because Smith has already argued that their toil and labor is not sufficiently recompensed by the goods and services they thereby acquire, that route, for Smith, is forestalled.9 Yet if the “mere trinkets of frivolous utility” they procure with the wealth their toil and labor generate do not repay them in “ease of body or tranquillity of mind” (TMS, IV.1.8: 181), they might nevertheless benefit from living in a society in which such toil and labor is undertaken by others. In other words, their utility might enjoy a net increase, despite the direct loss from their toil and labor, because the overall standard of living in their society is increasing. And this appears to be Smith’s view. He writes: “The earth by these labours of mankind has been obliged to redouble her natural fertility, and to maintain a greater multitude of inhabitants” (TMS, IV.1.10: 184). Even the “natural selfishness and rapacity” of the rich, Smith claims, though motivated by “the gratification of their own vain and insatiable desires,” nevertheless lead the rich to “divide with the poor the produce of all their improvements” (TMS, IV.1.10: 184). Hence, the now-rich poor

226  James R. Otteson men’s sons, even “without intending it, without knowing it,” engage in activities that “advance the interest of the society, and afford means to the multiplication of the species” (TMS, IV.1.10: 185). This is an instance of an “invisible hand” argument – Smith even uses the phrase “invisible hand” in the passage (TMS, IV.1.10: 184) – by which Smith argues that in a properly ordered commercial society the wealth generated by individual toilers and laborers benefits others, even unwittingly. This argument provides for Smith in fact two sources of benefit to offset the loss experienced by poor men’s sons. First, the overall standard of living in their society increases, providing them benefits indirectly if not directly. Even if the poor men’s sons are deceived about the utility they will receive from the “trinkets” they buy, they are not deceived about the overall benefit to them of living in a society in which goods and services are being produced at an increasing rate and scope. So, it is not the case that others are benefiting while they are losing; everyone is benefiting, including them. Second, Smith’s argument about the pleasure we receive from a mutual sympathy of sentiments (TMS, I.i.2: 13–6) suggests that poor men’s sons would feel the benefit of pleasure from knowing they are benefiting others. If they were to introduce into their utility calculations not only the utility to others who are affected by their activity but also the utility they themselves receive from benefiting others, they would see that their efforts are in fact repaid. Their efforts “to cultivate the ground, to build houses, to found cities and commonwealths, and to invent and improve all the sciences and arts” will “ennoble and embellish human life” (TMS, IV.1.10: 183), not just for others but for themselves. The poor men’s sons are not, then, merely the dupes of a losing bargain: both they themselves, as well as others about whose welfare they also care, benefit.

6 Conclusion If the poor man’s son, once grown and in possession of wealth, concludes that the trinkets and baubles he imagined as a young man that he would enjoy once rich do not, in fact, provide him with the utility he had imagined, Smith believes he is likely correct. Yet, his efforts will have improved the lives of others, and contributed to a society in which the estates of others, including the least among us, improve. Once he reminds himself that “to the rest of mankind he is a most insignificant part of” humanity and that “he is but one of the multitude in no respect better than any other in it” and no “impartial spectator [can] enter into the principles of his conduct” if he prides himself above all others, then he will realize that he must therefore “humble the arrogance of his selflove” (TMS, II.ii.2.1: 83). The poor man’s son should then expand the focus of his concern to include not only his own well-being but also that

Deception in Adam Smith’s case for free enterprise  227 the others with whom he interacts, exchanges, and partners – others who are “in every respect, as good as he” (TMS, II.ii.2.1: 83). David Schmidtz writes that Smith’s poor man’s son “loses sight of the difference between creating wealth and merely capturing it;” the poor man’s son turns “what should have been an effervescent positive sum society into a dreary zero-sum game” (2016: 216). What is missing on the poor man’s son’s behalf is an awareness that his toils and labors have a more expansive effect than merely whatever meager utility his procured baubles and trinkets afford. If the poor man’s son expects those baubles and trinkets to be worth years or decades of toil and labor, he is indeed deceived. But if he can lift his eyes above the trinkets, he will see that his toil and labor have generated benefit in the lives of others, benefit with which he can sympathize, and that he himself has benefited from living in a society in which others also toil and labor – for him. Smith’s overall case for free enterprise would still depend on other empirical claims Smith makes – including the productive surplus generated by division of labor, the resulting increase in the supply of goods and services and thus the decrease in their real prices, and the connection between self-interested seeking of benefit for oneself and benefit for others that are allegedly linked by an “invisible hand,” not to mention overcoming concerns about inequality, collective action problems, cronyism, negative externalities, and so on. But interpreted in the way I have suggested, Smith’s poor men’s sons – and, we might suppose, also the daughters of poor men and poor women – should expect that their efforts will be repaid not only in indirect ways to themselves but also both directly and indirectly to others. If so, then, as Smith suggests in the PMSP, we should welcome their efforts to improve our conditions and expect that their efforts can result in an overall beneficial proposition for them as well.

Notes 1 See, for example, Bassiry & Jones, 1993; James & Rassekh, 2000; Smith, 2006; Hühn & Dierksmeier, 2016; Norman, 2018. 2 Smith claims that the “whole expence of justice too might easily be defrayed by the fees of court” (WN, V.i.b.20: 719); that “[i]t does not seem necessary that the expence of those publick works [such as “roads, bridges, navigable canals, harbours, &c.”] should be defrayed from that publick revenue” (WN, V.i.d.1–2: 724) and adds that they “are always better maintained by a local or provincial revenue, under the management of a local and provincial administration, than by the general revenue of the state” (WN, V.i.d.18: 730); that “[t]he institutions for the education of the youth may, in the same manner, furnish a revenue sufficient for defraying their own expence” (WN, V.i.f.1: 758), adding that “[t]hose parts of education, it is to be observed, for the teaching of which there are no publick institutions, are generally the best taught” (WN, V.i.f.16: 764); etc. See Otteson, forthcoming.

228  James R. Otteson 3 See Werhane, 1991; Rothschild, 2001; Fleischacker, 2004; Sen, 2010; Bevan and Werhane, 2015; Fleischacker, 2016. 4 Scholarship that does address this parable, to varying extents, includes Justman, 1993; Griswold, 1999; Fleischacker, 2004; Rasmussen, 2008); Hanley, 2009; Hill, 2017. It is mentioned briefly in Wells and Graafland, 2012, and Norman, 2018 only alludes to it briefly (pp. 185–6). Foley, 2006 omits to mention it, though it would have served his criticism of Smith well. It receives no discussion in Reisman, 1976; Otteson, 2002; Aspromourgos, 2009, or Schliesser, 2017. It receives only fleeting mentions in Berry, Paga­ nelli, and Smith (eds.), 2013, though S. Tegos devotes one paragraph to it (Tegos, 2013: 367); or in Hanley, 2016, though D. Schmidtz’s contribution to this volume offers some potentially fruitful hints (Schmidtz, 2016), which I discuss below. It receives only a footnote in Wolcott, 2018 (n35). Pointing out that this scholarship omits discussion of the parable is not intended as a criticism, but only to indicate the comparatively little attention it has received. 5 Here and throughout, Smith’s text is reproduced exactly as it is in the original. Smith uses masculine pronouns in these discussions; to avoid begging any questions about the scope of his claims’ applicability, this essay adopts Smith’s convention. 6 Smith sometimes claims tranquility is a necessary component of happiness: “composure and tranquillity of mind [are] so necessary to happiness” (TMS, I.ii.3.7: 37); elsewhere he suggests that tranquility is equivalent to happiness: “Happiness consists in tranquillity and enjoyment” (TMS, III.3.30: 149). See also TMS, I.i.4.10: 23; I.ii.2.2: 32; I.iii.1.7: 45; III.1.7: 113; III.2.3: 114; III.3.31: 149–50. 7 Cf.: “In ease of body and peace of mind, all the different ranks of life are nearly upon a level, and the beggar, who suns himself by the side of the highway, possesses that security which kings are fighting for” (TMS, IV.1.10: 185). 8 What Smith would later identify as our duty to engage in the “becoming use of what is our own” (TMS, VII.ii.1.10: 270) – including investment, charity, and beneficence – applies only after we have respected the “most sacred laws of justice” (TMS, II.ii.2.2: 84). 9 It is of course possible that Smith is wrong about that claim – that is, perhaps such persons would, or at least might, receive sufficient compensation for their toil and labor from the goods and services they buy – but because Smith claims they do not, I pass over that possibility in silence.

References Anderson, E., 2016, “Adam Smith on Equality”, in Hanley (ed.), 2016, pp. 157–72. Aspromourgos, T., 2009, The Science of Wealth: Adam Smith and the Framing of Political Economy, Routledge, London – New York. Bassiry, G.R. & M. Jones, 1993, “Adam Smith and the Ethics of Contemporary Capitalism”, Journal of Business Ethics, vol. 12, no. 8, pp. 621–7. Berry, C.J., M.P. Paganelli & C. Smith (eds.), 2013, The Oxford Handbook of Adam Smith, Oxford University Press, Oxford. Bevan, D. & P. Werhane, 2015, “The Inexorable Sociality of Commerce: The Individual and Others in Adam Smith”, Journal of Business Ethics, vol. 127, no. 2, pp. 327–35.

Deception in Adam Smith’s case for free enterprise  229 Fleischacker, S., 1999, A Third Concept of Liberty: Judgment and Freedom in Kant and Adam Smith, Princeton University Press, Princeton. ———, 2004, On Adam Smith’s “Wealth of Nations”: A Philosophical Companion, Princeton University Press, Princeton. ———, 2016, “Adam Smith and the Left”, in Hanley (ed.), 2016, pp. 478–93. Foley, D.K., 2006, Adam’s Fallacy: A Guide to Economic Theology, Harvard Belknap, Cambridge, MA. Griswold, C.L., 1999, Adam Smith and the Virtues of Enlightenment, Cambridge University Press, Cambridge. Hanley, R.P., 2009, Adam Smith and the Character of Virtue, Cambridge University Press, Cambridge. ——— (ed.), 2016, Adam Smith: His Life, Thought, and Legacy, Princeton University Press, Princeton. Herzog, L., 2013, Inventing the Market: Smith, Hegel, and Political Theory, Oxford University Press, Oxford. Hill, L., 2017, “‘The Poor Man’s Son’ and the Corruption of Our Moral Sentiments: Commerce, Virtue and Happiness in Adam Smith”, Journal of Scottish Philosophy, vol. 15, no. 1, pp. 9–25. Hühn, M.P. & C. Dierksmeier, 2016, “Will the Real A. Smith Please Stand Up!”, Journal of Business Ethics, vol. 136, no. 1, pp. 119–32. James, H.S. & F. Rassekh, 2000, “Smith, Friedman, and Self-Interest in Ethical Society”, Business Ethics Quarterly, vol. 10, no. 3, pp. 659–74. Justman, S., 1993, The Autonomous Male of Adam Smith, University of Oklahoma Press, Norman, OK. Norman, J., 2018, Adam Smith: Father of Economics, Basic Books, New York. Otteson, J.R., 2002, Adam Smith’s Marketplace of Life, Cambridge University Press, Cambridge. ———, 2013, “Adam Smith”, in R. Crisp (ed.), The Oxford Handbook of the History of Ethics, Oxford University Press, Oxford, pp. 421–2. ———, “Adam Smith on Public Provision of Education”, Journal of the History of Economic Thought, forthcoming. Raphael, D.D., 2007, The Impartial Spectator: Adam Smith’s Moral Philosophy, Oxford University Press, Oxford. Rasmussen, D.C., 2008, The Problems and Promise of Commercial Society: Adam Smith’s Response to Rousseau, Pennsylvania State University Press, University Park, PA. Reisman, D.A., 1976, Adam Smith’s Sociological Economics, Routledge, New York. Rothschild, E., 2001, Economic Sentiments: Adam Smith, Condorcet, and the Enlightenment, Harvard University Press, Cambridge, MA. Schliesser, E., 2017, Adam Smith: Systematic Philosopher and Public Thinker, Oxford University Press, Oxford. Schmidtz, D., 2016, “Adam Smith on Freedom”, in Hanley (ed.), 2016, pp. 208–28. Sen, A., 2010, “Adam Smith and the Contemporary World”, Erasmus Journal for Philosophy and Economics, vol. 3, no. 1, pp. 50–67. Smith, C., 2006, Adam Smith’s Political Philosophy: The Invisible Hand and Spontaneous Order, Routledge, New York.

230  James R. Otteson Tegos, S., 2013, “Adam Smith: Theorist of Corruption”, in Berry, Paganelli & Smith (eds.), 2013, pp. 535–71. Wells, T. & J. Graafland, 2012, “Adam Smith’s Bourgeois Virtues in Competition”, Business Ethics Quarterly, vol. 22, no. 2, pp. 319–50. Werhane, P.H., 1991, Adam Smith and His Legacy for Modern Capitalism, Oxford University Press, New York – Oxford. Wolcott, G., 2018, “The Rehabilitation of Adam Smith for Catholic Social Thinking”, Journal of Business Ethics, vol. 149, no. 1, pp. 57–82.

14 Whose Adam Smith? The limits of law’s action Agustín José Menéndez

1 Smith’s modernity: coupling social cooperation and self-love through norm-following Scores of commentators have emphasized an alleged tension between the visions of human nature underpinning The Theory of Moral Sentiments and the Inquiry into the Nature and Causes of the Wealth of Nations. In the first book, Smith would emphasize the capacity to be empathic of human beings, which would predispose them not only to enjoy the happiness of others, but also to engage in different forms of mutual aid and benevolence. The picture of human nature that emerges from the latter book is usually taken to be very different: Smith seems to assume that human beings are foremostly possessive individuals, eager to appropriate things (material and immaterial), and in the process, exclude others from their enjoyment. What lies behind the different iterations of the so-called Adam Smith Problem (Tribe, 2008) is the complexity of human nature in Smith’s vision. In his Lectures in Jurisprudence, the Scottish philosopher puts forward a historical fresco of the progress of humankind, marked by the simultaneous development of ever more complex forms of social cooperation and the affirmation of the individual. Instead of opposing those trends, or regarding them as symptoms of a peculiar form of social schizophrenia, it is possible (and in my view necessary) to interpret Smith as showing the social basis of the individual (both in anthropological and moral terms), and the peculiar individual basis of all forms of modern socialization. As history marches forward in Smith’s reconstruction of human history, human beings learn how to divide their labour in increasingly effective ways, in the process not only multiplying the number of economic exchanges and the size of human societies, but also, increasing the stock of material resources in that given society. This puts in motion two related processes: firstly, the development and reproduction of social ties. The progressive sophistication of the economic structure presupposes increasingly complex forms of collective action: Only through concerted action it is possible to organize sophisticated forms of division

DOI: 10.4324/9781003301448-18

232  Agustín José Menéndez of labour. Secondly, the growing self-conscience of the individual as a separate being, both in moral terms (creating the basis for critical morality) and in economic terms (manifested in her or his acting on the basis of self-love). Most Smith’s commentators focus on the acquisitiveness of this individual, on the correlation that exists between her emergence and the tendency to self-love that Smith describes in TMS but which takes a central and defining role in WN. This is reflected in the natural tendency to truck, barter and exchange: This division of work is not however the effect of any human policy, but is the necessary consequence of a naturall disposition altogether peculiar to men, viz the disposition to truck, barter, and exchange; and as this disposition is peculiar to man, so is the consequence of it, the division of work betwixt different persons acting in concert. […] Man continually standing in need of the assistance of others, must fall upon some means to procure their help. This he does not merely by coaxing and courting; he does not expect it unless he can turn it to your advantage or make it appear to be so. […] When you apply to a brewer or butcher for beer or for beef you do not explain to him how much you stand in need of these, but how much it would be ‘his’ interest to allow you to have them for a certain price. You do not address his humanity, but his self-love. (LJA, vi.44–46: 347–8) What is less noticed, and is however of essence, is that while repeated economic exchange may result in the making of the possessive individual, all economic exchanges presuppose what is an even most fundamental character and trait of the individual, being a norm producer and norm follower. It is worth quoting at length the following passage from LJ: If we should enquire into the principle in the human mind on which this disposition of trucking is founded, it is clearly the naturall inclination every one has to persuade. The offering of a shilling, which to us appears to have so plain and simple a meaning, is in reality offering an argument to persuade one to do so and so as it is for his interest. Men always endeavour to persuade others to be of their opinion even when the matter is of no consequence to them. […] And in this manner every one is practising oratory on others thro the whole of his life. – You are uneasy whenever one differs from you, and you endeavour to persuade ‘him’ to be of your mind; or if you do not it is a certain degree of self command, and to this every one is breeding thro their whole lives. (LJA, vi.56: 352)1

Limits of law’s action  233 If that is so, then, the capacity and proclivity to barter, from which modern complex societies made up of individuals emerge, presupposes the moral nature of human beings, or what is the same, using the terminology of Robert Alexy (1998), their irrepressible tendency to raise claims to normative correctness and to offer arguments in their support. It is this normative character that explains the ubiquitousness of norms. All societies, from the most rudimentary hunter society to the most sophisticated and complex commercial society, are at the end of the day constituted and reproduced via norms. But the more complex societies, the commercial societies, do not only need more norms, but specific kinds of norms. This accounts for the need in modern societies of complementing positive morality with modern law, as we will see in Section 2. What I urge the reader to keep in mind for the time being is that Smith holds that the human proclivity to exchange material goods relies on the capacity of human beings to exchange moral reasons. If economic transactions can be limited to a consideration of the selfinterest of the parties (as they are in capitalist societies) is because such transactions are supposed to be framed by general norms that ensure the moral soundness of the overall scheme of division of labour. Barter, including barter in capitalist societies, is but one manifestation of the normative nature of human beings. And at any rate, the ever more complex schemes of exchange can only be constituted and reproduced if human beings can produce and comply with norms, either customarily emerged or explicitly formulated. In other words, bartering and trucking presuppose that human beings distinguish themselves, as a species, by being producers, users and followers of norms. At the very same time, Smith sustains that the incentive to engage in ever more complex forms of socialization, in ever more sophisticated forms of division of labour is to be found in the development of private property, which caters to the acquisitive character of human beings: But man has almost constant occasion for the help of his brethren, and it is in vain for him to expect it from their benevolence only. He will be more likely to prevail if he can interest their self-love in his favour, and shew them that it is for their own advantage to do for him what he requires of them. Whoever offers to another a bargain of any kind, proposes to do this. Give me that which I want, and you shall have this which you want, is the meaning of every such offer; and it is in this manner that we obtain from one another the far greater part of those good offices which we stand in need of. It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from their regard to their own interest. We address ourselves, not to their humanity but to their

234  Agustín José Menéndez self-love, and never talk to them of our own necessities but of their advantages. (WN, I.ii.2, 26–7) Or what is the same, once human societies move from the hunting to shepherding stage, social organization is mediated by some form of private property. This reflects the emergence of the consciousness of separateness of individuals in a very tangible material way, but it is important to stress now that private property entails something else, namely, a clear-cut differentiation of the process of production of goods (and services) and the process of allocation of the wealth thus produced. Through ever more complex forms of division of labour, the production of goods becomes increasingly a social venture, a form, as we have just emphasized, of extremely sophisticated collective action. A silent but decisive socialization of production takes place. Meanwhile, however, the product of such collective action is to be appropriated by concrete and specific individuals, in a literal sense privatized, a move that results and reinforces the previous processes of privatization of material resources and credit. The most advanced societies, that is commercial societies, are indeed characterized by collective forms of production and private forms of distribution and consumption of goods. Something that entails, as I was trying to show, the analytical and very effective distinction of the process of production and distribution, and also, at least potentially, of the criteria by reference to which the burdens are distributed in such different processes, as Smith himself noted: The rich and opulent merchant who does nothing but give a few directions, lives in far greater state and luxury and ease and plenty of all the conveniences and delicacies of life than his clerks, who do all the business. (LJA, vi.27: 341) Indeed, social production with private appropriation results, as illustrated by the quotation just made, in massive inequalities, which tend to increase as human societies go from one stage to the other (shepherd, agricultural, commercial), and as ever more forms of property are devised (for example, intellectual property). How come such inequalities are accepted, how come a system in which wealth is socially produced but privately appropriated is at the very least tolerated, especially by the less well-off in society? Smith offers what is essentially a sociological answer. Inequalities are accepted and even welcomed by most members of society, and not only by the winners, out of essentially utilitarian reasons. Ever increasing division of labour, coupling social production and private appropriation, produces so much wealth that not only the size of the social product, but the share of all members of society increases dramatically. In striking

Limits of law’s action  235 terms that Smith repeats once and again through his writings, he claims that the poorest member of a commercial society is better off than the king of a hunter society: We may see this odds in comparing the way of life of an ordinary day-labourer in England or Holland to that of a savage prince, who has the lives and liberties of a thousand or 10000 naked savages at his disposall. It appears evident that this man, whom we falsly account to live in a simple and plain manner, is far better supplied than the monarch himself. Every part of his cloathing, utensils, and food has been produced by the joint labour of an infinite number of hands, and these again required a vast number to provide them in tools for their respective employments. (LJA, vi.25: 340) Or what is the same, the less privileged groups in society would be in absolute terms much better off getting a relatively smaller size of the pie in a commercial society than they would be getting a bigger size of a smaller economic pie in any other kind of society. 2 The implicit but fundamental argument Smith is making is that through the expansion of division of labour is possible to create riches enough to sustain both the accumulation of wealth of the rich and the constant increase of the wages of the mass of dependent workers. It should be added, because it will be important later on, that this utilitarian acceptance of inequality that is part and parcel of the coupling of social production and private appropriation is coherent with Smith’s theory of social legitimacy, heavily influenced by Hume, and which underpins his legal theory. As is well known, Smith does away with any reference whatsoever to consent, and assumes that obedience is motivated either by reverence to authority (what we would perhaps characterize as the ultimate form of traditional legitimacy) or by a utility calculus (which is bound to boil down to a consideration of whether we are better or worse off, in terms of our liberties and wealth, living under a specific government and a specific set of norms). This principle or duty of allegiance seems to be founded on two principles. The 1st we may call the principle of authority, and the 2d the principall of common or generall interest. – With regard to the principle of authority, we see that every one naturally has a disposition to respect an established authority and superiority in others, whatever they be. […] Whatever be the foundation of government this has a great effect. […] With regard to the other principle, every one sees that the magistrates not only support the government in generall but the security and independency of each individuall, and they see that this security

236  Agustín José Menéndez can not be attained without a regular government. Every one therefor thinks it most advisable to submitt to the established government, tho perhaps he may think that it is not disposed in the best manner possible; and this too is strengthend by the naturall modesty of mankind, who are not generally inclined to think they have a title to dispute the authority of those above them. (LJA, v.119–21: 318) All this entails that the progress of mankind from the age of hunters to the age of commerce is propelled by the dramatic increase of the breadth and scope of arrangements through which individuals engage in different forms of division of labour. Now, such a transformation is critically dependent on the capacity of the individuals to follow norms, the very norms that render possible the division of labour, at the very same time that creates the conditions under which human beings are increasingly conscious of their individual separateness, of their being individuals. In other words, cooperation sustains the process of individualization, while the more human beings have a consciousness of their individuality, the easier is to engage in sophisticated forms of collective action. The social embedding of the individual coupled with the formation of societal ties by individuals constitutes the key to the production of wealth capable of allowing everybody, and not only the better off, to enjoy levels of well-being beyond subsistence. There is thus a double social or collective moment in Smith’s argument in favour of commercial societies. First, complex commercial societies result from the growth of schemes of division of labour, which rely in complex forms of social coordination. Second, the total wealth generated in a commercial society is so vastly superior to that produced in other societies as to allow to increase the economic resources at the disposal of all the members of society.

2  The emergence of the visible hand of law In the previous section, I have shown that the key and defining feature of human beings in Adam Smith’s thought is their being norm producers and norm followers. The propensity to barter, truck and exchange is indeed a consequence, and not a cause, of the normative nature of human beings. This immediately calls for an analysis of Smith’s legal theory. It is very well known that Smith planned to write a book specifically dedicated to jurisprudence, which would have developed his political and legal theory. Such a book was never completed, but we have now two accounts of his Lectures in Jurisprudence, which offer an overview of the whole range of thought of Smith but are to a considerable extent dedicated to law and government.

Limits of law’s action  237 It seems to me that Smith’s legal theory is articulated around three fundamental premises. Firstly, the historical character of modern law. Secondly, the close relationship that there is between law and all other means of social integration, especially law and positive and critical morality. Thirdly, the constitutive role that modern law plays in the socio-economic structure. Firstly, Smith affirms in clear and unconditional terms the historical character of modern law, in the process distinguishing positive, institutionalized law from other means of social integration and forms of law other than what we would call state law (including, but not exclusively, natural law). If that is so, and contrary to the assumption of many jurists and not so few legal theorists, it is simply not true that wherever we find a society, there is law (ubi societas, ibi ius). That is not true once we define law in a sufficiently precise manner and identify modern law with positive and institutionalized legal norms. Rather, the contrary is true: law is a social creation that emerges when social complexity overburdens the capacity of other means of social integration (i.e. positive morality), when the number and character of the tasks of social integration cannot be successfully discharged by non-institutionalized means of social integration. Less complex societies, essentially hunter societies, are constituted and reproduced by beliefs shared by the (small) collectives that form them, and which are more or less backed up and supported by different forms of religious faith. In the terms that have become standard in modern legal theory, they are societies in which positive morality discharges the basic tasks associated with social integration, while human beings develop their moral competencies. Secondly, Smith does not only emphasize the historical character of modern law, but also the extent to which modern law is closely related to the other means of social integration, and in particular, to its predecessor positive morality and to critical morality, which, much as law, reflects the normative character of human nature, but crystallizes as human societies progress. To put it differently: modern law might discharge in modern societies tasks that in other societies were performed by, among others, positive morality. But such replacement does not result in the withering away of positive morality, but rather in the redefinition of its social tasks, including those it performs in close relationship to modern law. Indeed, LJ can be constructed as an exploration of the relation between modern law, critical morality and positive morality (as Neil MacCormick [1981] rightly emphasized in his exploration of Smith’s legal theory). While Smith seems to deny the existence of a necessary normative connection between modern law and critical morality (and in this sense, his legal theory leans on a positivistic direction), LJ reveals the extent to which the structural principles of modern legal systems reflect not only basic norms of positive morality, which in their turn reflect basic norms of critical morality, responding to principles

238  Agustín José Menéndez that would be endorsed by the impartial spectator. Law complements positive morality, and in the process of doing so, is capable of integrating critical normative claims in the constitution of society. 3 Thirdly, in terms that anticipate in many respects those that Marx will use decades later, Smith establishes a clear correlation between the emergence of new forms of production (which in their turn entail different forms of organizing social cooperation, different forms of division of labour) and both the emergence of modern law and the number and character of the tasks discharged by it. The more improved any society is and the greater length the severall means of supporting the inhabitants are carried, the greater will be the number of their laws and regulations necessary to maintain justice, and prevent infringements of the right of property. (LJA, i.35: 16) In particular, Smith establishes a close connection between the emergence of forms of social production based on private property and modern law.4 The process is a complex and slow one. Modern law emerges first in the form of singular norms dictated by actors that would come to be identified as judges (much as moral judgement begins with individual decisions on specific instances). General norms (leading to the form of the modern statute) emerge later, propelled by the same trend of the increase of social complexity, but normatively motivated by the search for a technical means to limit the power of judges. Laws are in this manner posterior to the establishment of judges. At the first establishment of judges there are no laws; every one trusts the naturall feeling of justice he has in his own breast and expects to find in others. Were laws to be established in the beginnings of society prior to the judges, they would then be a restraint upon liberty, but when established after them they extent and secure , as they do not ascertain or restrain the actions of private persons so much as the power and conduct of the judge over the people. In this manner the legislative power is established, which in time, as well as the others, grows up to be absolute […]. (LJA, v.110–11: 314) As was already pointed in the previous section, societal progress leads to the emergence of ever larger and ever more complex patterns of division of labour. Law plays the role of enabling the infrastructure of such transformations, tasked not only with the solving of conflicts (the basic function of property norms and of criminal law), but also with the creation of the templates for the exercise of private autonomy, and, increasingly

Limits of law’s action  239 as complexity grows, with the coordination of actions in view of the achievement of common goods. This leads, as we will see in Sections 3 and 4, to Smith’s ambivalent formulation of what is at the same time a defence of collective action through the state and a theory of the limits of state action. The state has to discharge three main duties. Ensuring peace or at least security from foreign sources; civil peace (which is basically a matter of strict or narrow justice) and last, but certainly not least, the provision of a number of public goods and services (including education), the specification of which occupies Smith in LJ but above all in Books IV and V of WN. To conclude this section, allow me to stress which tasks correspond to the law, what the limits of the tasks assigned to the law are, determines what we make of the arguments put forward by Smith, in brief the Smith we construct, as I discuss in the next two sections.

3  Smith the liberist, Smith the ordoliberal The central role that Smith assigns to exchange in the progress of humankind (Section 1) can quite easily be extended into a plea for unleashing exchange from all different forms of constraints, for making economic actors “free” and in the process, to allow the spontaneous operation of markets, which will then, quite obviously, also be free markets. This seems to be the obvious interpretation to be given to the core sections of WN, in particular, to Smith’s “system of natural liberty”: All systems either of preference or of restraint, therefore, being thus completely taken away, the obvious and simple system of natural liberty establishes itself of its own accord. (WN, IV.ix.51: 687) In such a way, the constructive force of economic competition would propel society towards ever bigger opulence: Every man, as long as he does not violate the laws of justice, is left perfectly free to pursue his own interest his own way, and to bring both his industry and capital into competition with those of any other man, or order of men. The sovereign is completely discharged from a duty, in the attempting to perform which he must always be exposed to innumerable delusions, and for the proper performance of which no human wisdom or knowledge could ever be sufficient: the duty of superintending the industry of private people, and of directing it towards the employments most suitable to the interest of the society. (WN, IV.ix.51: 687)5

240  Agustín José Menéndez Unsurprisingly, a good deal of Smith’s commentariat tends to search into WN for the framework and fundamental materials of a liberist6 or an ordoliberal7 political philosophy. 3.1  Smith the liberist The liberist reading of Adam Smith largely is based on WN, and returned with full force in the late seventies, just at the time that liberist ideas came back with full force in political philosophy and in public discourse and in public policy (see Mirowski & Plehwe, 2009), and perhaps even more strongly, in the late eighties and early nineties, as the “liberal” end of history was proclaimed after the fall of “really existing” communism (Ther, 2016). If WN was for a long time read as a sustained plea against mercantilism and a defence of free trade, liberists have read it as the book that lays down the basis of their normative vision. In particular, Smith would have (1) established the historical and normative priority of market exchange over state intervention and regulation (indeed, the defining feature of Smith’s system of natural liberty that would also be at the core of liberism); (2) put forward a theory of the limits of state action, made of three components: (a) a prima facie case against state intervention; (b) a theory of the proper breadth of state intervention, defined by reference to public goods; (c) a final reason to restrict as much as possible the scope of state action on account of the easiness with which sectional interests can capture government and make use of it for the realization of their own interests. Many passages in the WN and in the LJ can be constructed as a plea for the “liberalization” of economic activity, anticipating the pleas for forms of negative integration allowing the (re)establishment of free trade and discourses against all different forms of economic dirigisme.8 However, Smith’s contribution was to drive home the normative (even ontological) priority of economic freedom as an organizing force of society. According to the Scottish philosopher, the primordial form, in historical and normative terms, of collective action is exchange, while the different forms of social intervention and regulation come afterwards, intended to correct or transform the previously existing, and normative prior, market exchanges. This is something that Smith makes crystal clear through the double move of (1) introducing an analytical distinction between natural and market prices and (2) raising the allegedly empirical claim that natural and market prices “naturally” coincide if free course is allowed to economic forces: “The market and naturall price therefore naturally coincide, unless they be hindered by some bad police” (LJA, vi.83: 362). If that is so, then, not only the burden of justification is placed on the shoulders of those arguing in favour of any form of social intervention,

Limits of law’s action  241 but it is assumed that, unless there is indeed proof to the contrary, intervention would raise actual prices and consequently reduce the wealth of the nation: “Whatever policy tends to raise the market price above the naturall one diminishes publick opulence and naturall wealth of the state” (LJA, vi.84: 362). This entails that the default option should be non-intervention: “the best police would be to leave every thing to its naturall course, without any bounty or any discouragement” (LJA, vi.97: 366). This is where the famous quotations from WN on the hidden hand seem to be fully fitting: As every individual, therefore, endeavours as much as he can both to employ his capital in the support of domestick industry, and so to direct that industry that its produce may be of the greatest value; every individual necessarily labours to render the annual revenue of the society as great as he can. He generally, indeed, neither intends to promote the publick interest, nor knows how much he is promoting it. By preferring the support of domestick to that of foreign industry, he intends only his own security; and by directing the industry in such a manner as its produce may be of the greatest value, he intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention. (WN, IV.ii.9: 456) In addition, Smith puts forward a three-fold theory of the limits of state action. We saw in the previous section that the capacity and propensity to propose and follow norms is the ultimate propeller of human progress. Most of the norms would be enforced either “spontaneously” or through non-institutional systems of social integration (such as positive morality). But once society reaches a given degree of complexity, once the breadth and the scope of the schemes of division of labour reach a certain magnitude and proportion, there is a need to have resort to modern law and modern government. To prevent that state intervention exceeds its purpose, it is necessary to develop a theory of the limits of state action, which is what Smith does not only in Books IV and V of WN but also in LJ. Firstly, Smith defines an area in which state intervention is justified, but, once and at the same time, excludes prima facie all forms of state intervention beyond it. The protection of justice in the strict sense of the term allows for the protection of the life, liberty and property of all members of society, and is the only one that results, by default, in the justification of coercion. This is so because Justice […] is the main pillar that upholds the whole edifice. If it is removed, the great, the immense fabric of human society, that

242  Agustín José Menéndez fabric which to raise and support seems in this world, if I may say so, to have been the peculiar and darling care of Nature, must in a moment crumble into atoms. (TMS, II.ii.3.4: 86) The limitation of the freedom of others is necessary to prevent that some individuals make use of such freedom in ways that result in the coercion of the freedom of others: The first and chief design of every system of government is to maintain justice; to prevent the members of a society from incroaching on one anothers property, or siezing what is not their own. (LJA, i.1: 5) As society cannot subsist unless the laws of justice are tolerably observed, as no social intercourse can take place among men who do not generally abstain from injuring one another; the consideration of this necessity, it has been thought, was the ground upon which we approved of the enforcement of the laws of justice by the punishment of those who violated them. (TMS, II.ii.3.6: 87; see also VII.ii.1.10: 269) When justice is at stake, thus, coercion is justified, and that cannot be challenged on the basis that the result is a restriction or constraint of economic freedom, which is actually not to be regarded so much as such, but as a restriction on the civil liberty of others (WN, IV.ix.51: 687). Secondly, beyond strict justice, the case for state intervention is only sufficiently strong regarding the provision of public goods (national defence and the administration of justice) and of publick works and certain publick institutions, which it can never be for the interest of any individual, or small number of individuals, to erect and maintain; because the profit could never repay the expence to any individual or small number of individuals, though it may frequently do much more than repay it to a great society. (WN, IV.ix.51: 688)9 Smith seems to be arguing, both in LJ and WN, against the institutionalization of what the moral virtue of benevolence would require us to do: As now men are only bound not to hurt one another and to act fairly and justly in their dealings, but are not compelled to any acts of benevolence, which are left intirely to his own good will, so in the ruder times this was extended to the nearest relations, and the

Limits of law’s action  243 obligation they were under to do for one another was supposed to be binding only by their inclination […]. If a son is taken by pirates, or any other set of men, as the barbarous nations on the coast of the Mediterranean sea, who will either in all probability put him to death or reduce him to slavery, we do not look on the father as bound to ransom according to the rules of justice, but only as a great sign of inhumanity and hardheartedness. (LJA, iii.78–79: 172) Thirdly, Smith offers an additional reason to interpret as narrowly as possible the scope of law and government: the advantages of state intervention have to be weighed and balanced against the risks of such public power being coopted, instrumentalized in favour of “vested interests.” Here it is interesting to notice, the key vested interests are not those of trade unions, as is characteristic in contemporary liberism, but those of capitalists themselves, which proves that if anything, Smith was an advocate of capitalism, but not of capitalists. The interest of the dealers, however, in any particular branch of trade or manufactures, is always in some respects different from, and even opposite to, that of the publick. To widen the market and to narrow the competition, is always the interest of the dealers. To widen the market may frequently be agreeable enough to the interest of the publick; but to narrow the competition must always be against it, and can serve only to enable the dealers, by raising their profits above what they naturally would be, to levy, for their own benefit, an absurd tax upon the rest of their fellow-citizens. (WN, I.xi.p.10: 267) 3.2.  Smith the ordoliberal The ordoliberal reading of Smith may seem to be quite similar to the liberist one at first sight. The fundamental difference lies on the extent to which the ordoliberal would stress the extent to which Smith, much as ordoliberals would later do, emphasize the positive character of the economic constitution, and in particular, of capitalism and of free markets. Human beings might well have a propensity to trade and an inclination to engage in different forms of economic exchange. Even if in certain respects capitalism is an evolutionary achievement, the fact of the matter is that it needs to be upheld by public authority. Consider, for example, what Smith regards as the key medium through which exchange takes place, namely, money. The Scottish philosopher seems to assume that money emerges as part of the undirected search for as medium that can serve both as the measurement of value and as a means of exchange. However, it is only through the intervention of public authority in the

244  Agustín José Menéndez coinage of money that such medium is stabilized, and its potential for the contribution to collective wealth can be fully realized (LJA, vi.109: 371). Seen from that perspective, the market is not normatively prior to state intervention. Rather the opposite is true. The market economy is the product of a specific constellation, of a set of decisions through which the infrastructure of the market is created: of a specific “ordo.” At the same time, state intervention has to be limited to constituting the market and keeping the market functional, capable of remaining a formidable decentralized device for the production of economic knowledge through the “signals” synthetized in market prices. As a general rule, the uncoordinated, unplanned exchanges occurring in markets are more conducive to the generation of wealth than can any form of public ownership of the means of production or, even, for that matter, an economy based on private property but subject to systematic (indicative) planning. The case for the central policy in the ordoliberal imagination, antitrust or competition policy, would be anticipated in Smith’s many eulogies of competition as the key force through which different private powers keep each other in mutual check. Coordination through markets in which actors are motivated by self-love promotes equality, liberty and justice if free competition prevails: Monopoly, besides, is a great enemy to good management, which can never be universally established but in consequence of that free and universal competition which forces every body to have recourse to it for the sake of self-defence. (WN, I.xi.b.5: 163–4)

4  Beyond the neoliberal Smith In the previous section, I have shown that the fundamental elements of both liberalism and ordoliberalism can be found in the works of Adam Smith. In this section, as anticipated in the introduction, I will argue that it is possible to search in Smith the materials with which to construct a rather different theoretico-political vision. That is not only possible but, in my view, can be more loyal to the fundamental insights of Smith, in particular, to the definition of human beings as essentially normative beings, producers and users of norms through which they relate to each other. Firstly, Smith seems to be deeply influenced by his own (limited) experience, both on what regards the full decoupling of political legitimacy from consent (which may have been compatible with social stability in 18th-century Britain, but it would be doubtful in most other places, including nowadays in “post-commercial” societies), on what regards the capacity of the “system of natural liberty” to radically increase wealth (lacking yet any knowledge of the extent to which industrialization would

Limits of law’s action  245 rely on the obviously wrong assumption of the infinitude of material resources at the disposal of society), and on what concerns the serious risks that public intervention, even if motivated by the best of intentions, may result in oppression (for example, ultimately religiously motivated) or in the diminution, not the increase, of wealth. This may explain why Smith does not seriously entertain that it could be part of the tasks of the state not only to provide public goods and services, but also to redistribute resources, especially, even if not exclusively, when socio-economic differences may risk the possibility of integrating society. Secondly, the elements of a radically different interpretation of Smith can be derived almost immanently from the ordoliberal interpretation of Smith. If the two fundamental media of the accumulation of property, and consequently of the generation of inequalities, namely property and money, are creatures of the state and of the law, the system of natural liberty stands in need of justification, because the system of natural liberty can only be sustained through explicit or implicit public intervention (so, in a relevant sense, is not “natural”), and it may be contested that it really results in liberty. Indeed, the argument that Smith provides is an utilitarian appeal to the wealth-generating capacity of capitalism when adequately constituted and maintained. Such line of reasoning, beside its contingency (it is far from clear whether leashed or unleashed capitalism does not produce both inequalities and misery), rules out by default the need of actually persuading all members of society of the correctness of such an argument, assuming implicitly that the design of the socio-economic order is outside the scope of what can properly be decided in a given society. But if human beings are normative and argumentative beings, the advocates of the system of natural liberty have not only to claim the superiority of such a system, but also to provide evidence that this is the case, and to persuade most members of society that they are right, so that they can mobilize a majority willing to write into the constitution that would define consequently the socio-economic structure. Something that, quite obviously, entails that the citizens of a given political community could opt for a different socio-economic constitution, even if that would generate less total wealth than capitalism (Keynes, 1933).10 Thirdly, I have already made implicit reference to the fact that a key component of LJ is the stadial theory of the development of mankind. Contrary to Neil MacCormick (1981), I have serious doubts not only about the details of the theory, but even about the larger picture.11 But if we leave aside such potential criticisms for a second, we may come to the conclusion that given the logic of Smith’s argument, there is no good reason why the commercial society should be the last stage in the evolution of human societies. There can be later stages, stages in which not only the scope of common action norms could be larger (a world and cosmopolitan state [Hill, 2010]) but in which the forms or organization

246  Agustín José Menéndez of division of labour may be further responsive to the sympathetic and empathic capacities of human beings, in which the moral and normative character of human beings would render possible, through processes of moral learning, to engage in forms of economic exchange in which appeal can be made not so much to self-love and self-interest, or at least not exclusively, but to mutual aid (pace Kropotkin [1902], affirming that the more a society relies on spontaneous or institutional form of mutual aid, the more it should be considered as advanced). In human history, we find many forms of exchange decoupled from acquisitiveness (Mauss, 1954; Davis, 1992), which could become dominant again in later stages of human history, this time as a result of our explicit endorsement of their moral and practical superiority. In fact, capitalism in many ways breaks the ground for such a move by, as I underlined in Section 1, resulting in the clear distinction of the criteria of contribution to the production of wealth and the criteria for the distribution of the produced wealth. In that regard, the Democratic and Social States, which emerged in interwar Europe, and were (partially) realized through social institutions such as social security and collectively financed systems of public health, can be regarded as an evolutionary achievement that proves, even if only tentatively, the possibility of this later evolution (MacCormick, 1989). To conclude reiterating the point: that does not represent a radical break with Smith’s argument, but a reconstruction of his thought that is attentive to its underlying spirit, not lacking in reflection in his thought: A superior may, indeed, sometimes, with universal approbation, oblige those under his jurisdiction to behave, in this respect, with a certain degree of propriety to one another. [….] The civil magistrate is entrusted with the power not only of preserving the public peace by restraining injustice, but of promoting the prosperity of the commonwealth, by establishing good discipline, and by discouraging every sort of vice and impropriety; he may prescribe rules, therefore, which not only prohibit mutual injuries among fellow-citizens, but command mutual good offices to a certain degree. When the sovereign commands what is merely indifferent, and what, antecedent to his orders, might have been omitted without any blame, it becomes not only blamable but punishable to disobey him. When he commands, therefore, what, antecedent to any such order, could not have been omitted without the greatest blame, it surely becomes much more punishable to be wanting in obedience. Of all the duties of a law-giver, however, this, perhaps, is that which it requires the greatest delicacy and reserve to execute with propriety and judgment. To neglect it altogether exposes the commonwealth to many gross disorders and shocking enormities, and to push it too far is destructive of all liberty, security, and justice. (TMS, II.ii.1.8: 81)

Limits of law’s action  247

Notes 1 See also LJA, vi.46: 348: This bartering and trucking spirit is the cause of the seperation of trades and the improvements in arts. A savage who supports himself by hunting, having made some more arrows than he had occasion for, gives them in a present to some of his companions, who in return give him some of the venison they have catched; and he at last finding that by making arrows and giving them to his neighbour, as he happens to make them better than ordinary, he can get more venison that by his own hunting, he lays it aside unless it be for his diversion, and becomes an arrow-maker. 2 Notice the structural similarity between Smith’s reconstruction of the sociology of the acceptance of inequalities in commercial societies with John Rawls’ second principle of justice, according to which social and economic inequalities have to be to the greatest benefit of the worse-off, the least advantaged in society. See John Rawls, 1971: 60 ff. 3 It is a clear defining mark of modern secular law that it integrates moral concerns with other kinds of concerns, including the frailty of human beings as moral beings. See LJA, i.86: 36. 4 Both the norms that constitute private property and the norms that the institutions (the judge, the policeman) that are in a position to enforce such norms are unknown in hunter societies (LJA, i.27–28: 14), emerge with the practice of shepherding (LJA, i.28: 15; i.33–34: 16), and become ever more complex in agricultural (LJA, i.48: 21) and commercial societies. See also Stein, 1979: 636. 5 See also WN, IV.vii.b.44: 582: To prohibit a great people, however, from making all that they can of every part of their own produce, or from employing their stock and industry in the way they judge most advantageous to themselves, is a manifest violation of the most sacred rights of mankind. 6 A very short but decisive intervention is the one by Hayek, 1978. 7 McLean, 2006; Klump and Woersdoerfer, 2010 claims to offer a “third way” and essentially social-democratic interpretation of Smith, which actually consists in a search in Smith of the materials with which to defend an ordoliberal “social market economy.” 8 The theoretical engine of Hayek’s plea for turning federalism into a means of pre-empting dirigisme could well have been inspired by a very specific reading of WN. See Hayek, 1948. 9 These are but the flip side of what has come to be labelled as “market failures,” and which, from a liberist perspective, are instances in which intervention is limited to mimic the production and distribution of goods that would take place if markets were fully operative. This use of collective force to extend the market in non-market areas is the defining feature, as is well known, of public choice. 10 Among the many paradoxes of ordoliberalism, the decisive one consists in the double move of ‘denaturalizing’ capitalism (through the acknowledgement of the fact that public authorities constitute markets) and immediately afterwards, developing a theory of the limits of state action that leaves no alternative but the creation of a “social market economy,’ and thus precluding democratic choice on the socio-economic order. 11 See for a groundbreaking interpretation Paganelli, 2022.

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References Alexy, R., 1998, “Law and Correctness”, Current Legal Problems, vol. 51, no. 1, pp. 205–21. Davis, J., 1992, Exchange, University of Minnesota Press, Minneapolis, MN. Hayek, F.A., 1948, “Economic Conditions of Inter-State Federation” [1939], in F.A. Hayek, Individualism and Economic Order, Chicago University Press, Chicago, IL, pp. 255–72. ———, 1978, “Adam Smith’s Message in Today’s Language” [1976], in F.A. Hayek, New Studies in Philosophy, Politics, Economics and the History of Ideas, Routledge, London, pp. 267–9. Hill, L., 2010, “Adam Smith’s Cosmopolitanism: The Expanding Circles of Commercial Strangership”, History of Political Thought, vol. 31, no. 3, pp. 449–73. Keynes, J.M., 1933, “Economic Possibilities for Our Grandchildren”, in J.M. Keynes, Essays in Persuasion [1931], MacMillan, London, pp. 358–73. Klump, R. & M. Woersdoerfer, 2010, “An Ordoliberal Interpretation of Adam Smith”, Ordo. Jahrbuch für die Ordnung von Wirtschaft und Gesellschaft, vol. 61, pp. 29–51. Kropotkin, P., 1902, Mutual Aid: A Factor in Evolution, Heinemann, London. MacCormick, N., 1981, “Adam Smith on Law”, Valparaiso University Law Review, vol. 15, no. 2, pp. 243–63. ———, 1989, “Spontaneous Order and the Rule of Law: Some Problems”, Ratio Juris, vol. 2, no. 1, pp. 41–54. Mauss, M., 1954, The Gift: The Form and Reason for Exchange in Archaic Societies [1923–1924], trans. W.D. Halls, Norton, New York. McLean, I., 2006, Adam Smith: Radical and Egalitarian, Edinburgh University Press, Edinburgh. Mirowski, P. & D. Plehwe (eds.), 2009, The Road from Mont Pèlerin: The Making of the Neoliberal Thought Collective, Harvard University Press, Cambridge. Paganelli, M.P., 2022, “Adam Smith and Economic Development in Theory and in Practice: A Rejection of the Stadial Model?”, Journal of the History of Economic Thought, vol. 44, no. 1, pp. 95–104. Rawls, J., 1971, A Theory of Justice, Harvard University Press, Cambridge. Stein, P.G., 1979, “Adam Smith’s Jurisprudence – Between Morality and Economics”, Cornell Law Review, vol. 64, no. 4, pp. 621–39. Ther, P., 2016, Europe since 1989: A History, Princeton University Press, Princeton. Tribe, K., 2008, “‘Das Adam Smith Problem’ and the Origins of Modern Smith Scholarship”, History of European Ideas, vol. 34, no. 4, pp. 514–25.

15 Work and freedom in Adam Smith Limits of historical experience Maria Luisa Pesante

1 Introduction Smith treated conceptions of labour within three contexts. First, he treated it as a generic necessity and capability of mankind. Attitude to labour did not have, in Smith’s writings, basically the character of human fulfilment. Within this framework, work is rather the “hardship that involves a giving up of liberty and ease, even happiness.”1 Complying with the call of labour is no natural attitude in man; it has to be learned, and that is possible only within an institutional framework where reward is proportional to work. The activity filling most of the individual’s lifetime labour shapes his or her character. Human characters, like those of the porter and the philosopher are not determined by different human endowments at birth, but by social position later on. Therefore, the chosen profession does not represent the realization of individual potentialities. Second, he analysed situations, behaviour, and range of action of wage labourers – members of a specific, historical type of labour organization. This analysis was part of a larger argument about the labourers’ wages in different societies, which has attracted the most attention by historians of Smith’s political economy. This chapter focuses on this second framework, and the labourers’ freedoms. It tries to dispel some confusion between natural freedom, actual liberty, and independence: mixing those concepts, without acknowledging their distinct characters makes Smith look happier about present British situations and their prospects than he actually was. 2 Finally, he considered labour, whether free or slave, as a crucial factor in the character of society in different situations, and in so doing, he tackled the problem of historical progress and its aporias. Without agreeing on everything Heilbroner wrote in his essay on the paradox of progress in Smith’s system, I follow his line of inquiry. The paradox is that the promise of continuous economic betterment and the prospect of general social betterment could not be warranted by the economic theory espoused (Heilbroner, 1975: 524). The point of Heilbroner’s line of inquiry is not the crude distinction between

DOI: 10.4324/9781003301448-19

250  Maria Luisa Pesante pessimism and optimism in WN. It is rather to go into the darker consequences of several crucial points of its theories: a connection Smith did not acknowledge. “Nevertheless the paradox is there” (Heilbroner, 1975: 536). Following this line, I will focus on specific essential passages, without trying to give any general outline of Smith’s philosophic and analytical system. Over the last 20 years, many interpreters, rightly reacting against the hegemonic reading of the book as a marginalist or neoclassical text, have construed a different and much more complex Smithian system at the price, however, of papering over several difficulties. In such a capacious system, you can always find sentences apt to limit or covering the most perverse consequences of other sentences (among those interpreters, for instance, Fleischacker, 2004a). On the contrary, Heilbroner went into the logic of Smith’s economic analysis and vision of history, without looking for any attenuating utterance.

2  The three frameworks The distinctions I drew between three frameworks cannot be drawn neatly in Smith’s texts. Rather they are employed by the present writer to provide some structure to a fragmented corpus of ideas. A theory of labour, if ever Smith reached that formal point in his research, is in no way the same thing as a theory of wages. The latter is about the ways labourers’ wages are fixed, and the situations in which they might increase or decrease. The former is rather about motivations, aspirations, or ambitions, and behaviour of labourers. Of course, the two are closely connected, as aspiration to increase one’s own pay was part of the labourers’ life in commercial societies, particularly if a theory of labour relies on some explanation of how labourers can live comfortably in a given society. In the Early Draft, Adam Smith left little doubt about his attitude towards the labouring people’s well-being. The comfortable living of society’s poorest members looks like a foremost concern of his. The high price of labour is to be considered not meerly as a proof of the general opulence of society which can afford to pay well all those whom it employs; it is to be regarded as what constitutes the essence of public opulence, or as the very thing in which public opulence properly consists. (ED, 12: 567) “Public” call for some emphasis. Smith’s discourse is not about private people’s wealth. Yet this apparently crucial concern of his does not seem to have been taken as particularly useful for understanding his arguments on mankind’s economy in the WN. The issue of the labour’s remuneration with its general consequences has been approached mostly through the theory of wages and division of labour. If we take literally

Limits of historical experience  251 the argument in the Early Draft, Smith’s problem at that moment seems to have been explaining how a high degree of inequality could be consistent with a high rate of real wages. Thus, equality as a societal characteristic is divorced from the requirement of sufficient income. The question was, and still remains, how high the degree of acceptable and useful inequality should be, as Keynes asked in 1936. In the text, there is a hint at a conflictual situation in which an impartial spectator has to choose his side. The polemical emphasis reminds us that Smith was writing against the widely spread opinion that the high price of labour, while common, or inevitable in rich countries, was just a sign of wealth, not a positive phenomenon for a country’s prosperity. Smith did not enter into any controversy between masters and labourers, rather he took his side against authors who propagated inadequate ideas about what should be the general situation of workers in commercial societies.3 It seems that Smith’s pressing problem, when writing about labour in the early sixties, was mainly to confute current views about the labourers’ behaviour, their pretended propensity to labour as little as possible, and to profit from their employers’ need for adequate labour supply in a growing economy. We might term those views as mercantilist, as those arguments were always framed in monetary terms, and assumed that money was wealth. During the 1762–1763 course of his lectures on jurisprudence, Smith in a remarkable passage completed his attack on the predominant persuasion about the labourers’ laziness in cheap years. When necessaries were low-priced, and the real wages therefore high, so the common persuasion went, labourers chose to work less days, diminishing the labour supply; higher monetary wages were required to induce them to work. Some authors went so far as to call for artificially induced dearness of provisions as a useful boost to the economy.4 Against this early version of the downward-sloping labour-curve, Smith contended that in those years, menial servants, finding they could maintain themselves more easily, would run away from the “subjected and mean condition of a meniall servant” and flock to manufactures, or even set up for themselves, “and they will also do more work for themselves than they did when in service” (LJA, vi.79–80: 360–1). 5 The passage is significant because there was an entire anthropology of labourers as intrinsically slothful behind the pretended theory Smith wanted to disallow. Yet, his main interest was not to disprove the theory, but to dismiss the anthropology.6 The labourers’ high wages are explained by their high productivity, thanks to the division of labour, even if in a great society “with regard to the produce of the labour […] there is never any such thing as a fair and equal division” (ED, 4–5: 563). So, the initial distinctive public opulence shifts, for many interpreters, to the “universal opulence which extends itself to the lowest ranks of the people” (ED, 10: 566). After some fantastic estimation of real value division between profit and wages, Smith

252  Maria Luisa Pesante warns his readers that “I do not mean that the profits are divided in fact precisely in the above manner, but that they may be divided in such manner” (ED, 11: 566–7). Smith repeated his argument some 30 years later in the WN, making more explicit the non-economic reasons both landlords and manufacturers had for preferring years of scarcity. Masters of all sorts, therefore, frequently make better bargains with their servants in dear than in cheap years, and find them more humble and dependent in the former than in the latter. They naturally, therefore, commend the former as more favourable to industry. (WN, I.viii.48: 101)7 The train of thoughts followed so far concludes with the neat definition opening the chapter on wages. The produce of labour constitutes the natural recompence or wages of labour. In that original state of things, which precedes both the appropriation of land and the accumulation of stock, the whole produce of labour belongs to the labourer. He has neither landlord nor master to share with him. (WN, I.viii.1–2: 82) This definition is not operative in WN. That situation was obliterated in the progress of history “long before the most considerable improvements were made in the productive powers of labour” (WN, I.viii.5: 82). The deductions of both rent and profit are exacted from all kinds of labour, both in agriculture and manufacture. Once having moved into the present situation (the land is wholly appropriated by landlords to the detriment of small farmers, the labourers in manufactures need someone rich in capital to advance their means of subsistence and materials). Smith went on in the analytical mode to explain how the system used to work in fixing wages’ level. I shall not attend to that topic, which is outside this chapter’s focus, but for emphasizing the different definition of natural wages in LJ.8 A man then has the natural price of his labour when it is sufficient to maintain him during the time of labour, to defray the expence of education, and to compensate the risk of not living long enough and of not succeeding in the business. When a man has this, there is sufficient encouragement to the labourer and the commodity will be cultivated in proportion to the demand. (LJB, 227: 495–6)

Limits of historical experience  253 No mention here of deductions for rent and profit, which are nevertheless assumed. It is also clear that the natural price of labour so defined is regulated neither by relations of supply and demand nor by the surplus of revenue (land) or stock (profit of manufacture) but first of all by the price of provisions. As was made clear in WN, I.vii.1–7: 72–3, the natural price of any commodity is its production cost given by the ordinary rate of rent, profit, and wages. The rationale is the same for the three agents of production: beneath that price, the factor of production would quit the market. Thus, when Smith approached the wages analysis, labour had already been set among commodities.9 Between the 1760s and the 1770s, Smith had no change of mind about the “oppressive inequality” (ED, 5: 564) of his society, and what the labourer deserved. He first enumerated all the facts that tilted against the workmen: the balance of bargaining power, upon which depended the common wages of labour, first of all among them the law and its practice, plus the ability to influence public opinion. But in contrast to the strong yet inarticulate statements of Early Draft, the labourers’ situation in the present rich English society is typified as that of men desperate in their struggles for higher pay, whether offensive or defensive, which are anyway doomed. They are desperate, and act with the folly and extravagance of desperate men, who must either starve, or frighten their masters into an immediate compliance with their demands. (WN, I.viii.13: 84–5) In this account, the money prices of labour are regulated by the balance of demand and supply for it. The demand cannot increase if the funds, both from revenue and profit, destined to provide workmen with materials and provisions, are not increasing. Thus, it is not the rich commercial society, endowed with high labour productivity, thanks to the division of labour and technology, that warrants the comfortable life of labouring people: only the increasing society can do that. Thus, we are assured that what can be read in Early Draft is a normative statement about the particular case of a distinct society, in which the growth of wealth outstrips the production of labourers, so it can afford high wages for some time, until the reproductive rate of labourers’ families outstrips the funds’ rate of growth. Smith well knew that “ought” was not to be mistaken for “is.” Even if the common use of the word “normative” is a phenomenon of the late 19th century, Hume had already forcefully taught that lesson. Smith himself referred to that distinction at least twice in TMS, first when he wrote that his starting point was “a matter of fact” (TMS, I.1.i.1: 9), second when he mentioned “those rules of natural equity, which ought to be enforced by the positive laws of every country” (TMS, VII.iv.37: 341).10

254  Maria Luisa Pesante Smith credited Grotius with being the first to attempt “a system of those principles which ought to run through, and be the foundation of the laws of all nations” (TMS, VII.iv.37: 342). Yet, he did not notice that the natural lawyers (Grotius included) failed to argue their statements’ normativity, and in many cases, simply relied on the universal consensus enjoyed by some positive laws. Their texts show a continuous shifting between normativity and description, or analysis, which is precisely what was done in the wages chapter in WN. Whereas it is meant to be an analysis of the relationship between money and real wages, the argument shifts clumsily between the two because of the difficulty in keeping together the two great distinction, one between increasing, stagnating, and decreasing economies, the other between money and real wages. So, real wages are suddenly introduced to describe the miserable condition of workmen in China, a rich but stagnating country (WN, I.xi.n.1: 255). It is obvious that natural liberty was a normative concept. No proof is needed for the WN’s basic line being instead analytical. Yet, a few details of the reductionist way Smith dealt with wages in contrast with the facts of his time might be useful. First, all work was reduced to that of wage earners, while independent artisans were discounted: “in every part of Europe, twenty workmen serve under a master for one that is independent” (WN, I.viii.10: 83).11 Second, he assumed that timewages were regularly paid in money to dependent workers occupied in stable relations, whereas payments mostly included goods, depended very much on the number of labour days, and were mostly measured as piece-work.12 Thus, the analytical mode, which informs readers that wages could only increase in some economic circumstance and within stringent limits, can well be distinguished from the normative mode in which Smith wrote about the rich society’s potentiality for increasing wages. This is not to dismiss Smith’s normative accomplishment, which was highly significant, but to explain the reasons of apparently conflicting accounts of labourers’ wages.

3  Smith’s view of English labourers’ actual situation Thus, we ought to ask why are labourers in rich, civilized England “desperate”? The text seems merely to suggest they are desperate because, in their struggle with employers for better contracts, they cannot succeed either in a dire situation or in a plentiful one. In the following paragraphs (WN, I.viii.28–35: 91–6), Smith argued that during the last period, real wages in England had increased well over subsistence.13 At the same time, he kept on stating that not every rich society could increase wages to that level, only an increasing economy can do it, as a comparison between the North American colonies, poorer but increasing faster, and England makes evident. Besides, Smith’s promise of a comfortable living for labourers in a commercial society is predicated on their being

Limits of historical experience  255 industrious and frugal, or sober, as they mostly, but not all, were, he thought (WN, intro. & plan.4: 10; II.iii.19–20: 338–9; V.ii.k.7: 872).14 Moreover, a further limit is introduced. The great productivity increase owing to the division of labour, on which the end of scarcity depended, implied the saturation of work-time, and also an organization of large production strictly controlling the individual workman. The division of labour meant for him not just continuously repeating the same simple operation, but also the loss of any self-determination in organizing his work. These desperate labourers have no past and no history in Smith’s descriptions. In Book III, no explanation is offered on how that body of wageworkers – one of the three functional classes of society – stemmed from the previous condition of slavery. While agricultural serfs are shown as acquiring their freedom step by step and becoming free tenants or small farmers, wage labourers do not turn up in that account. The origin of wage workmen in manufacturing is passed over also in the history of how cities grew. We may just suppose that merchants trading at great distance, who “violently” founded the manufacture, employed as wageworkers country people, without any resources, who took refuge in cities. Actually, burghers of the town who took up the farm of taxes in fee “became really free in our present sense of the word Freedom” (WN, III.iii.5: 400).15 So it seems that freedom came to city dwellers in bulk, without any social distinction. The free wage labourer’s origin cannot be located; of the retainers dismissed by big landlords and unnecessary tenants dismissed when farms were enlarged nothing more was written (WN, III.iv.13: 420–1). My primary point is that the WN analysis leaves no room for the labourers’ agency about their wages, the only aspect of their condition recognized by Smith as conflictive (there is no mention of work-time, or social relations). The common level of wages and its contingent oscillations are determined by factors wholly outside the labourers’ intervention.16 This is not to say that men are desperate because of any generalized awareness of their situation, but because they feel their powerlessness either to defend themselves in dire circumstances or to obtain anything in prosperity. As against the merchant’s ability to act both as an individual and in body, and choose his line of activity, and the landlord’s individual scope for action and choice of life, there is no point for the free wage earner either to resort to collective action or opportunity to choose his way of life: he can only be frugal and industrious, if he wants to survive or thrive. Contrary to some of his interpreters today, Smith in his analysis was not very confident about the wageworkers’ perspectives in commercial societies generally. He looks more hopeful in some parts of his descriptions, yet it has been doubted how much he knew of the labourers’ actual situations (Rule, 1986: 107, 119, Chapter 4 generally).

256  Maria Luisa Pesante Since he never defined what a comfortable living for them meant, the tension between his normative discourse and his descriptions or analysis is not to be lessened, while analysis in its turn poses further limits to wage levels in an already rich society.17 On the one hand, he writes that the more or less comfortable living of labourers depends on the contracts they are able to make with their employers in the struggle between opposite interests. On the other, he explains that the wage level depends upon general economic settings that have nothing to do with that struggle, a game in which labourers would always be the losers. All that struggle could determine would be a single contract. Moreover, his description never implied that there was any serious social problem in Britain.

4  Smith and his contemporaries To better appraise historically Smith’s moves, we need to put them in the context of contemporary debates. Smith challenged quite vigorously older writers supporting the charge that labourers were inherently prone to idleness, a main tenet of their defence of low wages since the mid-17th century. Yet he never confronted his contemporaries’ more refined arguments about the labourers’ place in present-day British society. During the fifties and sixties, when Smith’s system was in gestation, several strikes and food riots occurred in Britain.18 At least the disturbances in the Wiltshire and Gloucestershire textile sectors in 1756–1757 and 1766 respectively could not have escaped Smith’s notice: in those years, both industrial disputes and food riots were peculiarly conspicuous in those places that already had a history of collective disputes organization. There, a writer on economics provided a convincing explanation of why wage labourers would be desperate. Josiah Tucker, who held church offices in Bristol and Gloucester, and was therefore close to the place of disturbances, when writing his Instructions for Travellers19 assumed, like Smith, that bettering one’s own condition was the general motive of people’s behaviour. But, comparing the large manufacture of the Wiltshire textile sector to the putting-out system preponderant in Yorkshire, he noticed that in the latter, the small farmers and domestic weavers working by the piece with their families’ help, were under the delusion of becoming someday independent artisans. They would not. Yet, meanwhile, because of that hope, were sober, industrious, and averse to disputes. In Wiltshire’s large manufacturing factories, the many journeymen who worked by the thousands under the command of a “gentleman clothier” could not entertain any such hope of ever changing their condition. Contrary to Smith, Tucker was prepared to draw the unpleasant consequences of his analysis. When the social structure of production leaves common workers no prospect of bettering their own condition, self-love is subverted and becomes destructive (Tucker, 1757: 24–5).

Limits of historical experience  257 Besides Tucker, Adam Ferguson and James Steuart publishing their main works in 1767 wrote analyses of modern commercial societies incompatible with Smith’s. Against Ferguson’s negative appraisal of any kind of work, particularly manual work, Smith certainly wanted to emancipate whoever was working from what Ferguson had called the sordid concern with producing and gaining, but he never faced the reasoning behind that view. In a similar vein, Steuart’s argument that labourers’ independence (from their superiors, but not from their own desires) meant that everybody else was less free in a commercial society founded on equal laws, was left unchallenged. Both Tucker and Ferguson depicted the labourers’ position as a harbinger of tensions that might destabilize British society. Steuart’s description excluded that risk by committing what was left of British freedom to the care of a powerful statesman. All of them were disclosing the consequences of the labourers’ newly acquired freedoms for the stability of a hierarchical society. Comparison of Smith’s discourse on labourers with his contemporaries’ views highlights two of its crucial features. The first is the relation of natural equality to hierarchical society’s structures. Keeping together the defence of the former and eulogy of the latter was an art well practised by natural lawyers through to Hutcheson. An easy way to accept as natural also a society of ranks or orders was accomplished through the useful device of equality of exchange in onerous contracts. If anyone exchanges his labour for the right to use land, the proper contract can ensure respect of equality. So, if someone owns much, much more land than any other, this is just a fact in the domain of contingent history. Starting with the natural equality of mankind, Hutcheson passed through the need for industriousness by any human society (given the scantiness of natural produce after the multiplication of mankind), and finally came to compulsory work for people who had no other means of subsistence, whereas people endowed with it were free to choose. 20 Smith’s view differed from the received natural jurisprudence paradigm in one most important particular. Even if a few grandees had initially appropriated the whole land in the course of time, selling and buying would have dissolved that monopoly providing a fairer distribution, had not the legislative established wrong institutions like primogeniture and entails. His system of natural liberty would not have allowed any obligation, but men would have freely learned industriousness. This process, however, would not have changed the hierarchical structure of society. Sure, Smith thought that “some social hierarchy is necessary for society to subsist” (Schliesser, 2017: 162, n.4), and he greatly valued the supposed continuity and stability of British society. But Schliesser’s phrasing is abstract. In Hutcheson’s discourse, both equality and hierarchy were abstractions. Yet, whereas equality had the common and precise meaning that all men had to be acknowledged as sharing the same human

258  Maria Luisa Pesante character, saying that in Smith’s view, some hierarchy was necessary for society to subsist is not enough. What hierarchy, and which was the criterion for distinction? When detailed questions are asked about the concrete character of the social groups, some inconsistences are bound to turn up. Of the three chosen instances, only Tucker tried to define, with some hesitation, any natural difference between those inclined to command or to submit. Ferguson and Steuart saw any difference as a socially and institutionally determined fact. But neither made much of any natural equality as the normative baseline for human societies (they did not in fact argue within the natural jurisprudence paradigm), and factual differences in the context of legal equality were envisioned as containing risks of unrest and disruption. Thus, we may well ask why Smith never faced his contemporaries’ analysis that identified in present-day hierarchical society loci of disorder (or solutions for it he would not approve). 21 The point is that his conflictual yet harmonious society was itself less solid than he meant. Bettering one’s own condition as a universal human striving might seem an unpromising recipe for a stable hierarchy, especially if that striving is a feature of ambitious wage workers. Of course, the hierarchical structure might remain stable even if the people holding top positions in it should change. But the criteria Smith insisted on did not leave much space for such an outcome, preferring age, wealth, and birth rather than personal qualities difficult to discern and always disputable. In WN, Smith tried to qualify the formers’ relative significance according to the different stages of society. But in the end, the two “natural and respectable” distinctions remained: birth and ancient wealth (WN, V.i.b.3–11: 710–4; V.iii.89: 944). 22 The second feature is that Smith, when dealing with the labour remuneration, rarely gave to the labourers’ position a distinctive voice, covering it with the universal striving for bettering one’s own condition. The issue on which he famously did that was the food riot. By voice is not meant particular utterances or expressions, but attitudes inherent in their situation. Tucker did that when explaining why wageworkers in large manufactures would be unruly. In the sixties, Smith asserted their choice of work eligibility, when it was convenient for them. But in WN, he gave voice to their way of considering the policy of provisions only to show that their claims or riots were counterproductive. In contrast, Necker, 1775, explained their point of view when defining the basic attitudes of different classes in French society regarding the policy of provisions. His discourse was what Steiner has defined as material rationalization (Steiner, 1998: 110–1). As against formal rationalization that assumes only the principle of profit as rational in the economic domain of a market economy, material rationalization presumes that multiple principles, external to the pure economic logic, ought to be integrated as equally rational into the core of economic theory.

Limits of historical experience  259 According to Necker, “le peuple [...] éclairé par son instinct, commandé par ses besoins, envisage le blé comme un élément nécessaire à sa conservation.”23 The good they are fighting for is subsistence, and they view justice in terms of the rights of mankind protected by the right policy. In years of poor harvest and high prices, this vision can become conflictual with that of landowners and merchants/manufacturers. In those circumstances, the needs expressed by the people in their sense of justice are more important, whatever their reasons, than the principles of other classes (freedom to sell their property at the price they choose or freedom to trade). Therefore, authorities have to adjust their policies to the formers’ principle. Brown’s reading of WN as a monologue ruled by a single authorial voice fits well with Steiner’s account, yet, the latter’s outline of two different paradigms in economic theory allows also to see that Smith’s choices were not dictated only by the nature of economic analysis but by a definite inclination towards one model of social relations. His choice of arguments about labourers, to be debated or passed over, probably was largely inspired by his perception of the stability problems of his slowly growing hierarchical society. Let us remark that for the three authors with opposite views to Smith’s, what caused concern was the workers’ agency, not the wage level. For Tucker, that agency was perverted; for Ferguson, pretentions to equal rights risked abolishing any meaningful freedom for the higher ranks, while for Steuart, the economy itself tended to disequilibrium, so it needed a statesman at the elm to govern it. Smith did not uphold his idea of freedom against the three. A little attention paid to the precise wording of some famous phrases by Smith in two instances may satisfy us that looking at the problem of power is no wrong way to understand his stance. About the division of labour, he wrote that a little labour, properly and judiciously employed, is capable of procuring any man a great abundance of all the necessaries and conveniences of life. [...] As this labour however is applied with great skill and judgement […]. (ED, 12: 567) If we wonder whose judgement it is, Smith’s answer later on looks slightly different from that apparently implied here. Readers bent on emphasizing his strictures on the mental alienation of workers bound to do always and continuously the same operation have passed over the problem that there is someone’s mind presiding over the process. In WN, Smith wrote: The greatest improvement in the productive powers of labour, and the greater part of the skill, dexterity, and judgment with which it is

260  Maria Luisa Pesante any where directed, or applied, seem to have been the effects of the division of labour. (WN, I.i.1: 13) And then: The owner of the stock which employs a great number of labourers, necessarily endeavours, for his own advantage, to make such a proper division and distribution of employment, that they may be enabled to produce the greatest quantity of work possible. (WN, I.viii.57: 104) The agent has changed, the judgement is of course that of the large manufacturer, the only one able to organize production through a division of labour. So, in three successive steps, Smith dismissed both saturation of work-time and relative independence in organizing such work as irrelevant to workmen’s well-being, or their freedom. In the same way, attention ought to be paid to the universal human drive to bargaining and exchanging; it too contains a power dimension that is often forgotten when making that drive the fulcrum of society’s cohesive force without, however, looking at the specific working of its roots: from being led and directed by other people we learn to wish to become ourselves leaders and directors. […] The desire of being believed, the desire of persuading, of leading and directing other people, seems to be one of the strongest of all our natural desires. […] Great ambition, the desire of real superiority, of leading and directing, seems to be altogether peculiar to man, and speech is the great instrument of ambition, of real superiority, of leading and directing the judgments and conduct of other people. (TMS, VII.iv.24–25: 336)

5  Men’s natural propensity In his lectures in 1763, Smith dictated: in this manner every one is practising oratory on others thro the whole of his life. […] In this manner they acquire a certain dexterity and adress in managing their affairs, or in other words in managing of men […]. (LJA, vi.56–57: 352) Managing men by persuasion instead of coercion is certainly closer to liberty; nevertheless, it implies a relationship of leading to the following.

Limits of historical experience  261 Behind the natural propensity to bargaining and exchanging, and its roots in the propensity to persuade, there is a faint shadow of power, which should be neither overlooked nor overemphasized. It is significant, if we wish to connect work to freedom, and ask what the scope for labourers’ freedom is.24 Freedom was not the issue that attracted the greatest interest of interpreters. Their main focus has ever been either on the connection of freedom to commerce or on the natural system of perfect liberty, justice, and equality, an abstract expression of normative import unfortunately left undefined in that it seemed obvious (WN, IV.vii.c.44: 606; IV.ix.17: 669).25 On the former point, the most common interpretation is that according to Smith, commerce provides the right environment for the development of freedom. The individuals’ natural freedom in general, is freedom to pursue their interests without interference from the government. More specifically, it comprises freedom of employing capitals and labour, selling products, moving around, or settling as one chooses. With the latter freedom, denied by the laws of settlement (against which Smith deplored the workmen never took action), we come across his arguments about workmen’s actual freedoms. The passage on refusal of the natural liberty to settle where the workman wishes is the only one where Smith emphasized some lack of freedom for workmen in contemporary Britain. Otherwise, he ignored the restrictions of labourers’ personal freedom, which was still real in the country, the most important being the compulsion (with the penal sanction of one to three months imprisonment, including whipping and hard labour) to perform an employment contract until its expiration, instead of being sued for damages if in case (Hay, 2004).

6  Meanings of freedom It is mostly taken as obvious that freedom and independence share the same meaning and emerge from the same process. It is uncontested that in WN, the focus is on the individual’s independence as secured by the rule of law, within the limits of what law can achieve (WN, III. iv.20: 425). Actually, the two words refer not at all to the same condition. Freedom is the condition of not being subjected to someone else’s arbitrary commands, like a slave or a serf. Independence is the condition of not depending on someone else for one’s subsistence or support. Briefly, nobody could be independent who was unfree, but being free is not enough for being independent. Smith was careful to write “servile dependency” if in case (WN, III.iv.4: 412). Yet the ambiguity possibly originated with Smith himself when he wrote: the principal attributes of villanage and slavery being thus taken away from them [burghers of the towns], they now, at least, became really free in our present sense of the word Freedom. (WN, III.iii.5: 400)

262  Maria Luisa Pesante When the present sense of the word is then equated with personal independence, to avoid any hint at political rights, confusion ensues.26 Of course, everybody is free in Britain, but independence includes different degrees among workers, since what the law cannot affect is socio-economic dependence. The independent worker selling his products to a number of customers is independent, and obviously free in that he does not depend upon a master’s command either in his activity or for his subsistence, yet he depends on his customers for his subsistence, even if not upon any one of them (WN, III.iv.12: 420). Only the farmer, when he is the owner of the soil he tills himself, can be deemed really independent. In our North American colonies, where uncultivated land is still to be had upon easy terms, [...] [w]hen an artificer has acquired a little more stock than is necessary for carrying on his own business [...] he becomes planter [...]. He feels that an artificer is the servant of his customers, from whom he derives his subsistence; but that a planter who cultivates his own land, and derives his necessary subsistence from the labour of his own family, is really a master, and independent of all the world. (WN, III.i.5: 378–9) The North American planter can utter his perceptions in his own voice, but his insight does not hold generally, since even in Britain, for instance, farmers are not proprietors. The station of a farmer besides, is, from the nature of things, inferior to that of a proprietor. Through the greater part of Europe the yeomanry are regarded as an inferior rank of people, even to the better sort of tradesmen and mechanicks, and in all parts of Europe to the great merchants and master manufacturers. (WN, III.ii.20: 395) Even tenants at will not in villenage, therefore free, were dependent on their lord if they did not pay the full market rate of rent (WN, III.iv.6: 414; LJA, i.119: 50–1). The situation of wageworkers, especially in large manufactures, looks more problematic. Surely they were free people whose person and property were under the protection of the law. Yet, for most of their time, they were under the command, only in theory legally restrained, of a single master upon whom their subsistence also depended. Thus, how much independence they enjoyed was contingent on the labour market, whether more or less favourable to workers looking for employment. Again, not the rich, only the improving society could provide workers any opportunity for bettering. China is a country much richer than any part of Europe (WN, I.xi.n.1: 255), yet workers there are miserable.

Limits of historical experience  263 Thus, wageworkers can be distinguished as a specific kind of labourers. When enumerating the lower ranks of the people that “make up the greater part of every great political society,” Smith mentioned “[s]ervants, labourers and workmen of different kinds” (WN, I.viii.36: 96). By servants, did he mean just menial servants or wage labourers generally? The question had been crucial in Britain since the mid-17th century, and hotly debated by historians in the last century. It was still open in 1777, when Lord Mansfield famously decided about any wageworker, whether working for a set time or by the piece, that “[h]e is a servant by the nature of his work, and here he is a servant each day he worked for his master.”27 Natural liberty, of course, was part of Smith’s normative reasoning. About actual freedoms enjoyed by working people, his attitude was far more sympathetic than that of other enlightened philosophers, for instance, of Hume. Against his friend’s assumption that workmen could be driven to their physical limits, Smith shared a large part of Turgot’s criticism of it (WN, I.viii.44: 100; cf. Turgot 1914: 664 [Turgot to Hume, March 25, 1767]). Thus, Gay’s generalizations about enlightened philosophers’ negative attitudes towards working people (cf. 1977: 517–22) must be taken with some caution. But, if we distinguish – as we ought to – the condition of freedom from independence, Smith’s text leaves workers little scope in the actual situation for bettering their condition as a whole. This chapter is certainly not the first to distinguish between normative and descriptive/analytical discourse in Smith’s works. 28 They are two different, although compatible kinds of discourse. Yet, in Smith’s works, like in natural jurisprudence writings, the problem is the continuous shifting between the two without any clear and constant distinction. But interpreters should not mistake one for the other. If the aim is reconstructing Smith’s persuasion and intention (a problematic task), the distinctions between normative and analytical, and natural liberty, freedom and independence might be secondary, although not to be overlooked. If it is textual reading of WN, they are crucial.

Notes 1 Schliesser, 2017: 219. See WN, I.v.7: 50. About primitive societies, Smith pointed to “the hatred of labour and the love of present ease and enjoyment” as the main vice in the poor (WN, V.i.b.2: 709). 2 Smith was rather inaccurate in his choice of words about labourers, workmen, artisans. I write of “labourers” as the more general term. 3 Smith seems here to conform to the Humean character of those who try to “regulate anew our moral as well as political sentiments” (Hume, 2006, II.ii: 11). Hume was referring to Mandeville’s eloge of luxury. 4 See, for instance, several works by John Houghton from the 1680s to the early 18th century. 5 The same passage in LJB, 229–30: 496–7, is far less clear. I do not discuss here Smith’s explanation of the relationship between natural and market wages.

264  Maria Luisa Pesante 6 The Smithian contention about the labourers’ attitudes to labour has already been related by Samuel Fleischacker as discourse about distributive justice (see Fleischacker, 2004b: 62–8). After enumerating the attitudes towards labourers that should direct to an idea of distributive justice he fails to connect them specifically to any such idea, not to say to any so inspired policy. 7 Here Smith also explained the seeming truth in the pretensions of masters. 8 This same definition is employed by Smith to explain different levels of compensation in different profession, a repetition of Cantillon’s use. Aspromourgos, 2013: 279 calls those natural wages “wages relativities” before writing that there is no single determinate theory to explain them, as the course of natural wages depends also by the parts’ bargaining power. For the definition of “analytical,” I follow Vivienne Brown positing that “economic analysis conceptualizes economic agency in terms of what is required by that analysis” (Brown, 2009: 68). 9 Werhane, 1991 claims that not labour itself, only labour productivity is the commodity labourers sell. 10 Moreover, see the first sentence in LJA. 11 John Rule thought Smith’s number was a reasonable guess for Britain. 12 Muldrew and King, 2003: 168 ff. Smith mentioned the law that obliged to pay wages in money (WN, I.x.c.61: 158). 13 Subsistence meant obviously a socially defined fact. 14 The celebrated passage, taken from Locke, at WN, intro. & plan.9: 11, is more about different degrees of inequality than levels of well-being. 15 The present sense of the word means personal civil freedom. 16 Brown, 2009, noticed that economic analysis in WN shifted the meaning of agency from the individual’s choice towards the effects caused by large aggregates. 17 Even if we accept Brown’s statement that there is no incompatibility between the two different conceptions of agency in TMS and WN, the same cannot be said about the social consequences of two different types of agency. 18 Dobson, 1980: 157–61, lists ninety-six labour disputes between 1750 and 1769, most of them for wage reduction or increase. But more recently, John Rule wrote that where historians once talked of dozens now they must accept hundreds (Rule, 2000: 168). 19 Tucker, 1757 was in Smith’s library, together with other works by the same: Mizuta, 2000, n. 1684: 257. 20 Hutcheson, 1755, vol. I: 319ff.; vol. II: 109ff. See his argument about what makes labour eligible (vol. I: 321). 21 Should Smith have taken into account those views? Was it choice or just indifference? About Steuart, he wrote in a letter “Without once mentioning it [Steuart’s book], I flatter myself, that every false principle in it, will meet with a clear and distinct confutation in mine” (Corr., 132: 164). Yet, saying the contrary is no confutation. For Ferguson see his Essay on the History of Civil Society (Ferguson, 1996), Part III, sect. II; Part IV, sects. II–III. 22 In TMS they are generalized: Nature has wisely judged that the distinction of ranks, the peace and order of society, would rest more securely upon the plain and palpable difference of birth and fortune, than upon the invisible and often uncertain difference of wisdom and virtue. (VI.ii.1.20: 226) 3 Necker, 1820: 4–5. On the meaning of “peuple,” see Steiner, 1998: 89ff. 2 24 The mention of power disappears in WN, I.ii.2: 25, where the process is described as a contract, a key word. On one hand, within the natural

Limits of historical experience  265 jurisprudence paradigm, it embodies a basic equality between the contracting parties, on the other, being rooted in persuasion, it might share the latter’s desire for superiority. People who love to domineer do not like to use persuasion instead of command (LJA.iii.114: 186; WN, III.ii.10: 388). Smith’s use is typically ambivalent. 25 So, interpreters could equate it either to a system of market exchange, or equality of treatment of different sectors of the economy by the sovereign (Brown, 2009), or the opposite of the mercantilist system, as Winch, 1978: 81. 26 On such confusion see, for instance, Haakonssen, 2006: 19; Lieberman, 2006: 240. 27 Hay, 2004: 88–9. The law 20 Geo II c 19 (1746) enumerated a lot of jobs covered by the Statute of Artificers. About Smith’s careless use of “servants” see WN, I.viii.45–47: 100–1. 28 However, Winch, 1978: 85, wrote of “supposititious dualisms.”

References Aspromourgos, T., 2013, “Adam Smith on Labour and Capital”, in C.J. Berry, M.P. Paganelli & C. Smith (eds.), The Oxford Handbook of Adam Smith, Oxford University Press, Oxford, pp. 267–89. Brown, V., 2009, “Agency and Discourse: Revisiting the Adam Smith Problem”, in J.T. Young (ed.), Elgar Companion to Adam Smith, Edward Elgar, Cheltenham, pp. 52–72. Dobson, C.R., 1980, Masters and Journeymen: A Prehistory of Industrial Relations 1717–1800, Croom Helm, London. Ferguson, A., 1996, An Essay on the History of Civil Society [1767], ed. F. Oz-Salzberger, Cambridge University Press, Cambridge. Fleischacker, S., 2004a, Adam Smith’s Wealth of Nations: A Philosophical Companion, Princeton University Press, Princeton, NJ – Oxford. ———, 2004b, A Short History of Distributive Justice, Harvard University Press, Cambridge, MA – London. Gay, P., 1977, The Enlightenment: An Interpretation, vol. 2, The Science of Freedom [1969], Norton, New York – London. Haakonssen, K., 2006, “Introduction. The Coherence of Smith’s Thought”, in K. Haakonssen (ed.), The Cambridge Companion to Adam Smith, Cambridge University Press, Cambridge, pp. 1–21. Hay, D., 2004, “England, 1562–1875: The Law and its Uses”, in D. Hay & P. Craven (eds.), Masters, Servants, and Magistrates in Britain and the Empire, 1562–1995, University of North Carolina Press, Chapel Hill, NC – London, pp. 59–116. Heilbroner, R.L., 1975, “The Paradox of Progress: Decline and Decay in The Wealth of Nations”, in A. Skinner & T. Wilson (eds.), Essays on Adam Smith, Clarendon Press, Oxford, pp. 524–39. Hume, D., 2006, An Enquiry Concerning the Principles of Morals [1751]: A Critical Edition, ed. T.L. Beauchamp, Clarendon Press, Oxford. Hutcheson, F., 1755, A System of Moral Philosophy, in Three Books, Foulis, Glasgow – Millar, London. Lieberman, D., 2006, “Adam Smith on Justice, Rights, and Law”, in K. Haakonssen (ed.), The Cambridge Companion to Adam Smith, Cambridge University Press, Cambridge, pp. 214–45.

266  Maria Luisa Pesante Mizuta, H., 2000, Adam Smith’s Library: A Catalogue, Clarendon Press, Oxford. Muldrew, C. & S. King, 2003, “Cash, Wages, and the Economy of Makeshifts in England, 1650–1800”, in P. Scholliers & L. Schwarz (eds.), Experiencing Wages: Social and Cultural Aspects of Wage Forms in Europe Since 1500, Berghahn, New York – Oxford, pp. 155–80. Necker, J., 1820, “Sur la législation et le commerce des grains” [1775], in Œuvres complètes de M. Necker publiées par M. le Baron de Staël, t. I, Treuttel et Würtz, Paris, pp. 1–342. Rule, J., 1986, The Labouring Classes in Early Industrial England, 1750–1850, Longman, London – New York. ———, 2000, “Industrial Disputes, Wage Bargaining and the Moral Economy”, in A. Randall & A. Charlesworth (eds.), Moral Economy and Popular Protest: Crowds, Conflict and Authority, Palgrave Macmillan, Basingstoke – New York, pp. 166–86. Schliesser, E., 2017, Adam Smith: Systematic Philosopher, and Public Thinker, Oxford University Press, Oxford. Steiner, P., 1998, Sociologie de la connaissance économique. Essai sur les rationalisations de la connaissance économique (1759–1850), Presses Universitaires de France, Paris. Tucker, J., 1757, Instructions for Travellers, n.l., n.p. Turgot, A.R.J., 1914, Œuvres de Turgot et documents le concernant, ed. G. Schelle, t. II, Alcan, Paris. Werhane, P., 1991, Adam Smith and His Legacy for Modern Capitalism, Oxford University Press, New York – Oxford. Winch, D., 1978, Adam Smith’s Politics: An Essay in Historiographic Revision, Cambridge University Press, Cambridge.

The problem of history

16 History without providence? Adam Smith — historian and critic of modernity Alberto Burgio

1 Introduction There is unanimous agreement that rejecting a providentialist model was decisive in the emergence of secularisation in modern thinking. It is therefore necessary to examine whether Adam Smith had a secular or religious view of history in order to shed light on his stance on modernity. However, it is clear from the extraordinarily large body of critical work that has been produced since the bicentenary of The Wealth of Nations that focusing on passages where Smith explicitly discusses religious issues is inconclusive. Smith’s works, known for their ambiguity, provide sound arguments for both a theological and an immanentist interpretation.1 It is undeniable that The Theory of Moral Sentiments contains recurrent references to God, the “Author of nature,” and reverential attestations of God’s benign providence. However, in an analysis of the genesis of moral judgement that never directly implicates God, these references can be understood as metaphorical, or as an exercise in circumspection. The same can be said of Smith’s references to the invisible hand in TMS and WN. These can be seen as allusions to the hand of God, but equally well as a “joke” or as a metaphor for the fact that the course of history is not at man’s disposal, a warning that hubris should be curbed given the heterogony of ends. 2 We will therefore take an indirect approach, not addressing the question of whether Smith’s view of history is secular or religious head on but exploring the relationship between Smith and the progressivist view of history. This is for one simple reason. Even if nothing rules it out, it is difficult to sustain that providence guides human history if we deny the progressive nature of history. If the hypothesis that Smith considers history to be progress turns out to be untenable, the providentialist interpretation also becomes untenable, or is at least undermined.

2  A model is a model It may seem inappropriate to question whether Adam Smith saw history as a progressive sequence of events. His reputation as one of the greatest

DOI: 10.4324/9781003301448-21

270  Alberto Burgio theoreticians of progress of the 18th century has been overwhelmingly acknowledged since Edward Gibbon recognised that, in WN, Smith joined Hume and Robertson in directing “a strong ray of philosophical light” on “the interesting subject” of “the progress of society in Europe.”3 More recently, in his influential 1954 paper, Duncan Forbes notes that “Adam Smith was one of the pioneers of the idea of the progress of society.” Albeit with pertinent caveats based on the heterogony of ends and to Smith’s recognition of the “grave disadvantages” that “the progress of society brings with it,” Forbes saw “the idea of the progress of society” as “the central theme and organizing principle” of Smith’s meticulous research, which is to this day the central theme of critical debate that tends to place Smith in stark contrast to Jean-Jacques Rousseau.4 Indeed, this interpretation appears unconfutable, given the prominence that Smith’s work gives to “stadial theory,” the model of historical dynamics honed by the most eminent figures of the Scottish Historical School in the 1750s and 1770s on foundations laid by Hume. This group included Smith, John Darlymple, Lord Kames, William Robertson, Adam Ferguson, and John Millar. Stadial theory, which John Pocock has referred to as “the theoretical or conjectural ‘history’ of ‘the progress of society’” (Pocock, 2001: 317), 5 holds that human history consists of a series of “stages” distinguished by different types of economic activity (hunting and fishing, shepherding, agriculture, manufacturing, and commerce) involving significantly increased productivity and marked by improved living conditions and lifestyles, and a steadily growing population. Moreover, institutional structures and judicial systems were increasingly able to safeguard individual liberty and to distribute property equitably and protect it effectively, starting with land reform.6 Smith frequently availed himself of the stadial model, in particular in Lectures on Jurisprudence. This appears to confirm that he saw history in terms of progress. However, things are not as simple as they may seem. The debate on stadial theory is still open, in the wake of the critique of its historical-materialistic interpretation as advanced by Ronald Meek and (up until 1975) by Andrew Skinner, based on Roy Pascal’s insights. Knud Haakonssen and Donald Winch have disputed the centrality of economic factors (“modes of subsistence”) in the emergence of individual stages and in the transition from one stage to another.7 In a significant shift, objections related to determinism added to those related to the excessive emphasis given to economic consequences, tacitly assuming that there can be no historical materialism without economistic reductionism (see Salter, 1992: 223–4). A controversy that is particularly relevant to Smith’s work has also emerged more recently over whether stadial theory is in fact synchronic or achronic (a taxonomy of different states of society) rather than diachronic (a theory of historical progress from one stage to another).8

History without providence?  271 If this were the case, the issue of Smith’s stance on the progressivist view would be resolved at a stroke: a taxonomy cannot support a theory of progress as it compares different social structures independently of time. However, Smith’s writings do not appear to lend weight to this view. In LJ, where stadial theory is most prominent, the terms “stage” and, above all, “age” are mainly used in connection with this theory, which Smith clearly uses as a theory of the progressive evolution of human history.9 Terminological analysis is therefore of little help here, as the prominence that Smith gives to stadial theory in LJ appears to confirm his progressivist view. However, there is another issue that merits consideration. As noted by Ecem Okan (2017), it concerns the nature of this text, the guise that Smith adopts to deliver his lectures on “jurisprudence.” As Tony Aspromourgos puts it, the key issue is Smith’s “division of scientific labour” (Aspromourgos, 2011). In LJ, Smith presents a theoretical model of the foundations of civil government and property rights, a philosophical and political alternative to a model based on natural law and contractualism. Smith’s approach here is clearly and explicitly normative: “Jurisprudence is the theory of the rules by which civil governments ought to be directed” (LJA, i.1: 5), and “Jurisprudence is that science which inquires into the general principles which ought to be the foundation of the laws of all nations” (LJB, 1: 397). That is, Smith is not using history from a historian’s perspective here. What he offers to his students as he reviews the range of different “stages” are ad hoc scenarios designed to make the exposition of his political philosophy more effective. Pocock refers to these as “heuristic constructs,” and correctly notes that what we find “in the lectures Smith delivered at Glasgow” is “jurisprudence organised as history, and history so organised said to depict ‘the progress of society’.”10 That is, Smith uses history in LJ to exemplify the sequence of socio-economic structures and juridical institutions that in his view represent “the natural order of things” (WN, III.i.9: 380). The Lectures depict an ideal history, and a view that is “Theoretical or Conjectural,” as Dugald Stewart put it (Life, II.48: 293).11 It was a conscious decision of Smith’s to assign a fictitious and imaginary status – of pure type, counterfactual – to the “stages” discussed in LJ. This is clear from how he introduces his analysis of the acquisition of property by occupation: “If we should suppose 10 or 12 persons of different sexes settled in an uninhabited island […]” (LJA, i.27: 14; cf. LJB, 149: 459). However, this is merely the most flamboyant of his Robinsonades. Throughout LJ, whenever Smith describes the lifestyles and relations of different “stages of society,” he formulates conjectures, elaborates ideal types, and presents generalisations by developing scenarios that illustrate his theoretical model. As noted by István Hont, Smith’s stadial theory is a “thought experiment.”12 Smith might have viewed it as an “imaginary machine” that served to organise segments

272  Alberto Burgio of the socio-historical world into a “system” (HA, IV.19: 66). If the historian’s task is to recount actual facts (LRBL, ii.18: 91; ii.39–40: 101–2), the philosopher’s is to imagine, to create, to invent “the connecting principles of nature” (HA, II.12: 45; cf. LRBL, ii.134: 146). As in Rousseau’s histoire hypothétique and Kant’s philosophische Geschichte, the sole purpose of these principles is to allow the elaboration of views of the world as a relatively coherent and comprehensible whole. In LJ, this leads to a “rational reconstruction” focused not on the genesis or actual evolution of civil government and property rights but on their foundations, on the fundamental conditions underpinning their legitimacy. However, these observations on LJ do not hold for WN, where true historical analysis plays an important role and where Smith also uses stadial theory. Smith’s belief in progress appears even more forceful here. Whereas WN is also a historical work, as Smith states in the “Plan of the Work,” where he writes that Book III addresses actual events (WN, intro. & plan.7: 11), the fact that stadial theory is also used in WN appears to lend weight to the progressivist interpretation of Smith’s position. However, here things are once again not as they may seem. There are only sporadic references to stadial theory in WN, mainly in the first chapter of Book V. In particular, Smith does not use the theory for its primary purpose here, that is, as a history, albeit an imaginary or hypothetical one. Rather, he uses stadial sequences to elucidate what WN deliberately calls “states of society.” His aim was to provide what was here indeed a “static comparison” (Blosser) of an underdeveloped state to a more advanced one, and to validate the thesis that wealth derives principally from the accumulation of capital and the division of labour. This leads to an apparent paradox. Stadial theory is not mentioned in the historical sections of WN, neither in Book III, where Smith describes the transformation of several European countries into commercial societies, nor in Book V, where he reflects on the fall of the Roman Empire. However, this apparent paradox melts away in the light of what we have noted above. If stadial theory describes an ideal history, applying it to actual history would be pointless. This helps to explain why LJ and WN contain “two different historical narratives” (Okan, 2017: 1250) and why it would be incorrect to see the differences between them as “contradictions.”13 There is no obvious reason why Smith’s account, in WN, of actual historical processes or his description of the society of his own times would require him to respect the logic of a normative model that served to outline his own political philosophy to his students. It cannot be denied that the terminal decline of feudalism “in all the modern states of Europe” (WN, III.i.9: 380) did not follow the sequence laid out in LJ. There was no initial growth in agricultural production, followed by a growth in manufacturing and then the expansion of commerce. The change was in fact triggered by the development of international commerce and its effect on manufacturing.

History without providence?  273 The events that determined the fall of the Roman Empire also violated the “natural” sequence outlined in LJ. The violence of the barbarians “interrupted the commerce between the towns and the country,” leading to a reversal and the onset of a period of “poverty and barbarism” (WN, III.ii.1: 381–2). However, this is not indicative of any presumed revision of Smith’s thinking, as otherwise he would simply have dispensed with stadial theory. Indeed, it highlights that the sequence of actual processes was “in every respect contrary to the order of nature and of reason” (WN, I.x.c.26: 145), that this order “has been […] entirely inverted,” and that the dynamics of the transition to a commercial society were “unnatural and retrograde” (WN, III.i.9: 380). In short, a model is a model. Smith’s stadial theory involves time in that it describes a progressive dynamic, but it uses time to lay out an ideal sequence of historical phases, a sequence that WN variously defines as the “natural order of things” (III.i.9: 380), “the natural [p]rogress of [o] pulence” (III.i: 376) or “the natural progress of a nation towards wealth and prosperity” (IV.ix.28: 674). This has a consequence that is in our view decisive. If it is true that stadial theory deals with historical topics but does not describe actual processes, its prominence in Smith’s narrative says nothing about Smith’s view of history. All that stadial theory has to say on this issue is that actual history “inverted” the model, and thus, in Smith’s view, diverged from the progressive evolution envisaged by the natural (that is, ideal) order of things (Fiori, 2021: 104, note 6). No metaphysical or theological sense should be attached to the word “natural” here, which Smith does not always use in a positive sense (Pack, 1995; Waterman, 2004: 90–5). It is used here as a synonym of “logical” (rational, in line with the essence of the thing), such as when he speaks of “the natural price” of goods or services, or discusses “the natural distribution” of the “stock” of a society. In this sense, what Smith captures through his use of stadial theory is a counterhistory. It is necessary to look elsewhere to understand his view of historical processes, to the sections that are in fact about history, where he describes and appraises the actual reality of his own times and develops an account of its genesis.

3  The worker, the slave, and the magnate We hold that a close reading of passages where Smith specifically addresses history confutes the view that he saw history in terms of progress. Smith clearly does not deny that, over the millennia, there has been progress in the material conditions and moral attitudes of human beings. Not even the most intransigent critic of the notion of progress would go that far. Rousseau himself had placed the “true youth of the world” at some distance from humanity’s “primitive state” (1999: 62) and included the greatest thinkers of modern times in the pantheon of the “Preceptors of the human Race” (1992: 21). This absurd claim can be refuted simply by

274  Alberto Burgio noting Smith’s warm praise of Hume, who was the only scholar he knew to have shown that “commerce and manufactures gradually introduced order and good government, and with them, the liberty and security of individuals, among the inhabitants of the country” (WN, III.iv.4: 412). Our position is rather that (1) the picture that Smith paints is chiaroscuro, seeing history as a combination of progress and regress, and that (2) it is debatable whether Smith believed that the benefits of progress outweighed the harm it caused (e.g., Hill, 2001: 18; Rasmussen, 2006; Hill, 2007: 347–8). Given Smith’s observations on the exorbitant human and social cost of the division of labour, Marx often refers to Adam Ferguson, the most Machiavellian member of the Scottish School, as Smith’s “teacher” and “master” (1956 [2.2]: 145; 1887 [III.2 and XIV.4–5]: 99 fn., 347, 356). Although this was probably a hyperbole, the view deserves consideration given its source. Marx was not a cursory reader or an uncritical admirer of Smith. The only way to verify the statement appears to be to consider some key figures in the modern social landscape depicted in Smith’s works: the worker, the slave, and the magnate. 3.1. WN opens, as does the Early Draft, with a celebration of the social and technical division of labour, which Smith sees as having led to “the greatest improvement in the productive powers of labour” (WN, I.i.1: 13), and thus to “the superior opulence which takes place in civilized societies” (ED, 6: 564) in modern Europe, societies that were incomparably wealthier than any previous society anywhere in the world. The fact that the division of labour increases wealth is for Smith its key undeniable benefit, but his words on its social, moral, and political consequences deflate this positive assessment. Smith makes no bones about the relationship between employer and employee being a power relationship based on poverty, even in modern-day society (WN, I.viii.8: 83; see also Dellemotte & Walraevens, 2013). The dominant party in this relationship imposes, “either by violence or by the more orderly oppression of law,” an unequal division of labour in society, which results in the poorest being burdened with a more onerous workload and the wealthiest even exempt from any form of labour at all: “[t]he labour and time of the poor is in civilized countries sacrificed to the maintaining the rich in ease and luxury,” and the poor labourer […] bears on his shoulders the whole of mankind, and unable to sustain the load is buried by the weight of it and thrust down into the lowest parts of the earth, from whence he supports all the rest. (LJA, vi.28: 340–1; cf. LJB, 212–3: 489–90; ED, 5: 564) Smith was no Mandeville and had no qualms about criticising this state of affairs on moral grounds (WN, I.viii.36: 96), but what struck him most were the collective harmful consequences that the division of labour

History without providence?  275 placed on those who worked for others. This is addressed in particular in Book V of WN, where Smith focuses on “the Education of Youth,” concluding that the State must assume its share of this responsibility. Although similar views are also expressed in LJB (328–33: 539–41), the fact that the issue is raised in that specific chapter of WN led some to conclude that Smith believed that the negative consequences of the division of labour could be obviated through increased public and private spending on education (Rasmussen, 2013: 58). This thesis is somewhat tenuous, given the disproportion between the harm caused by the division of labour and his proposed remedies. Smith merely recommends that “the great body of the people” should be taught “to read, write, and account” and should be shown “the elementary parts of geometry and mechanicks” (WN, V.i.f.51, 54, 55: 784–5). However, the real issue is a different one. Whether or not it could be resolved in principle, for Smith, the problem is that this is in actual fact how things are in the modern Europe of commercial societies, that in this society the division of labour produces these effects. That he saw this as an extremely serious problem is clear from how he describes it. The relevant pages are very well-known so we can be concise. Those from “the inferior ranks of people” (WN, V.i.f.51: 783) perform simple repetitive tasks, and “the man whose whole life is spent in performing a few simple operations […] generally becomes as stupid and ignorant as it is possible for a human creature to become” (WN, V.i.f.50: 782). He becomes “incapable” not only “of relishing or bearing a part in any rational conversation,” but also “of conceiving any generous, noble, or tender sentiment” (WN, V.i.f.50: 782), with all moral aspects of his existence dropping below the threshold that the impartial spectator might set. His body loses the ability to engage in other tasks. He becomes pusillanimous and his “mental mutilation, deformity and wretchedness” is a true and proper societal “leprosy” (WN, V.i.f.60: 787–8), as those who are ignorant or obtuse easily fall prey to “delusions of enthusiasm and superstition” and are incapable of recognising “the interested complaints of faction and sedition” (WN, V.i.f.61: 788). The full import of this devastating criticism, which unsurprisingly impressed Marx, emerges from a close reading of the following statement, where Smith writes that “in the barbarous societies,” in contrast to modern society, [I]nvention is kept alive, and the mind is not suffered to fall into that drowsy stupidity, which, in a civilized society, seems to benumb the understanding of almost all the inferior ranks of people. (WN, V.i.f.51: 782–3) That is, “civilized society” is a form of society in which the intelligence of almost all disadvantaged classes is clouded by a drowsy stupidity. We

276  Alberto Burgio may well ask, therefore, what civilisation actually means, and in what regard Smith held it. It should be noted that Smith’s observations on the difference between primitive societies and modern society permeate his work and, in many ways, paint a positive picture of “the savage” and of societies based on hunting and fishing. One aspect stands out for its distinctly Rousseauian tone. While modern man is fragmented, corrupted by “[t]he uniformity of his stationary life” (WN V.i.f.50: 782), “the savage” is whole, invulnerable, and possesses a “firmness” and an aptitude for “self-command” worthy of a Stoic (TMS, V.2.9–10: 205–8). Smith’s portrayal of this figure contrasts starkly with that offered by Lord Kames two years prior to the publication of WN and raises serious doubts about Smith’s reputation as “the first great theorist of the age of commerce.” As noted by Maureen Harkin, it also reveals his “profound concerns […] about the problems and limitations of the modern subject, and about the idea of progress” (Harkin, 2005: 443; 2002: 23–4). 3.2. The TMS paragraph just cited contains a brutal attack on slavery in the form of a eulogy of African slaves (“nations of heroes”) and a stream of invective directed at their “sordid master[s],” “the refuse of the jails of Europe” (TMS, V.2.9: 206). This brings us to the second topic worthy of scrutiny. In the modern world, the liberty of workers is usually enshrined in law, but Smith notes that it would be incorrect to assume that the problem of slavery had been resolved: “We are apt to imagine that slavery is entirely abolished at this time, without considering that this is the case in only a small part of Europe,” overlooking the fact that “it is still in use” in many other parts of the world, including “the greatest part of America” (LJA, iii.101: 181; cf. LJB, 134: 451–2). In fact, Smith sees it as “allmost impossible” that slavery “should ever be totally or generally abolished” (LJA, iii.101: 181; cf. iii.115: 187), for a host of reasons. These include the perversions of human nature, as, while it is economically irrational, slavery exalts the “love of domination and tyrannizing” that rages in the heart of man (LJA, iii.114: 186; cf. iii.130: 192; LJB, 134: 452; WN, III.ii.10: 388; see also Pack, 1996: 254; Fiori, 2012: 431–2; Luban, 2012: 277). They also include a dogged desire to protect vested interests, given that, since “[i]n all countries where slavery takes place[s] the greatest part of the riches of the subjects consists in slaves,” the abolition of slavery would spark “a generall insurrection” (LJA, iii.115–6: 187). However, the most interesting topic centres precisely on the dynamics of history. Many pages are devoted in LJ to demonstrating a clear dialectical link between the increased wealth and freedom of some and a greater number of slaves, a worsening of their living conditions, a greater use of coercive violence, and even the spread of racist ideologies. Political freedom makes free citizens more powerful, which explains why “[t]he authority of the masters over the slaves is […] unbounded in all republican governments”

History without providence?  277 (LJA, iii.102: 181). This absolute power in turn means that “the service which is exacted” of the slaves “is so great” that it requires “the strictest discipline to keep them in order” (LJA, iii.102: 181; cf. LJB, 136: 452). This vicious circle produces a range of distortions. “[I]n a wealthy and opulent country where slavery is tollerated their number is always very great, and far greater than that of the freemen” (LJA, iii.105: 182). The huge number of slaves means that people in wealthy countries live “in continuall fear of their slaves,” and the slaves are therefore treated “with the greatest severity” and “every method” is used “to keep them under” (LJA, iii.106: 183). Moreover, “[i]n a rich country the disproportion betwixt [the master and the slave]” is so great that the wealthy master “will hardly look” on his slave “as being of the same kind; he thinks he has little title even to the ordinary enjoyments of life” (LJA, iii.108–9: 184; cf. LJB, 137: 452–3). Smith’s analysis leads to a number of interesting conclusions about how things have changed over time. He notes that slaves had no reason to celebrate greater “[o]pulence” or “refinement,” given that both “tend greatly to increase their misery,” and advances in political freedom also conferred no advantages, as “[t]he more arbitrary the government is in like manner the slaves are in the better condition” (LJA, iii.110: 185; cf. WN, IV.vii.b.55: 587–8). That is, “the state of slavery is a much more tollerable one in a poor and barbarous people than in a rich and polished one” (LJA, iii.105: 182) and slaves “are treated much better in the rude periods of mankind than in the more improved” (LJA, iii.110: 185). All this has clear implications for the presumed progressive nature of history. Smith writes: “[t]he more society is improved the greater is the misery of a slavish condition” (LJA, iii.110: 185) and “[s]lavery is more tolerable in a barbarous than in a civilized society” (LJB, 137: 452). This brings us back to the question of what this “improvement” meant to Smith, and how, in his view, modern society could consider itself to be more advanced than during the “rude periods” of human history. Although Smith also addresses some European enclaves of slavery, such as the “colliers and salters” of Great Britain, whom he calls “the only vestiges of slavery which remain amongst us” (LJA, iii.126: 191), his narrative focuses mainly on colonial slavery. However, excluding slavery from Smith’s analysis of the commercial system would make little sense. Smith notes that colonial commerce gives modern empires huge advantages (WN, IV.vii.c.50, 55: 608–9, 610) and that slavery was a key factor in manufacturing in European colonies (WN, IV.vii.b.54: 586), including in British colonies (WN, III.ii.10: 388). Colonialism was an integral part of modern commercial society and played a decisive role in European industry taking off in the second half of the 18th century and the first half of the 19th century. International trading companies were the means through which the financial and political metropolitan elite ruled the colonies, and commerce with the colonies was the main

278  Alberto Burgio generator of profit for the “merchants and master manufacturers” that Smith saw as the puppet masters of European governments. 3.3. This brings us to the final key figures in the social landscape of the modern world that WN examines, namely, the self-interested merchants and manufacturers that Smith saw as “the principal architects” of commercial society configured as a “mercantile system” (WN, IV.viii.54: 661). In Great Britain, as in most of Europe, the prevalent system since the 16th century was not free trade, seen as “the obvious and simple system of natural liberty” (WN, IV.ix.51: 687), and “the natural system of perfect liberty” (WN, IV.vii.c.44: 606) that marked the “Age of Commerce” addressed in LJ (LJA, i.27: 14). It was rather a mercantile system that went against the common interest as it was based on monopolies (WN, IV.vii.c.89: 630).14 Smith is explicit here. A perverse “system of commerce” of this kind is what today’s society has become; this is “the modern system,” clearly identifiable “in our own country and in our own times” (WN, IV.intro.2: 428). He therefore saw Great Britain – “a nation whose government is influenced by shopkeepers” (WN, IV.vii.c.63: 613) – as an “unwholesome bod[y]” afflicted with the disproportionate growth of some organ, namely, colonial commerce based on monopolies (WN, IV.vii.c.43: 604). This was this state of affairs that Smith consciously subjected to a “very violent attack” (Corr., 208: 251). It is worth considering who these merchants and manufacturers were, and how Smith viewed their actions and their motives. We will first examine these actions and motives. The law of the day banned worker coalitions but permitted the “constant and uniform combination” of masters, which made it easy for them to keep wages low (WN, I.viii.13: 84). Smith’s opinion of this emerges from his analysis of the causes of rising product prices. Even though prices rise much faster as a result of high profits (“in geometrical proportion”) than of high wages (“in arithmetical proportion”), “[o]ur merchants and master-manufacturers complain much of the bad effects of high wages in raising the price” and “say nothing concerning the bad effects of high profits” (WN, I.ix.24: 115–6). Smith deprecated the perfidy and hypocrisy of magnates who remained “silent with regard to the pernicious effects of their own gains” (WN, I.ix.24: 115), and later speaks of their “clamour and sophistry” (WN, I.x.c.25: 144) and their “interested sophistry” (WN, IV.iii.c.10: 494), but his analysis does not limit itself to moral judgement. Smith was firm in the belief that structural reasons were responsible for the contrast between “those who live by profit” and the “publick interest” (WN, I.xi.p.10: 266–7). The magnate seeks to maximise his profit rate, which “is naturally low in rich, and high in poor countries, and […] is always highest in the countries which are going fastest to ruin,” which means that the magnate’s objective, “in any particular branch of trade or manufactures, is always in some

History without providence?  279 respects different from, and even opposite to, that of the publick” (WN, I.xi.p.10: 266–7). Far from operating in the interest of the prosperity of a country, merchants and manufacturers worked towards its ruin. This is also confirmed by their constant drive for market growth in the absence of competition. Smith therefore portrays them as the incarnation of an “exclusive corporation spirit” (WN, IV.ii.21: 462) and of a “spirit of monopoly” diametrically opposed to “the interest of the great body of the people” (WN, IV.iii.c.10: 493). This provides the answer to who the merchants and manufacturers were. For Smith, they were those for whom “to know in what manner it enriched the country” was of no interest “but when they had occasion to apply to their country for some change in the laws relating to foreign trade” (WN, IV.i.10: 434). They were citizens of no country, as “a very trifling disgust will make [them] remove [their] capital, and together with it all the industry which it supports, from one country to another” (WN, III.iv.24: 426). They were those who, “with all the passionate confidence of interested falsehood,” stimulated a “[m]ercantile jealousy” of neighbouring countries (in particular of France in the case of Great Britain), hampering “an open and free commerce” (WN, IV.iii.c.13: 496). Finally, though we could go on, they were those who saw commerce “as their principal business” and therefore “regard the character of the sovereign as but an appendix to that of the merchant” and reveal themselves to be “incapable of considering themselves as sovereigns, even after they have become such” (WN, IV.vii.c.103: 637). A clearer measure of Smith’s indignation and his disdain of this sector of society is the contrast expressed in WN between magnates and political rulers, despite his notable diffidence of the latter. He writes in TMS that “[t]he fatal effects of bad government arise from nothing, but that it does not sufficiently guard against the mischiefs which human wickedness gives occasion to” (TMS, IV.2.1: 187). The “mean rapacity” of merchants and manufacturers was such a clear example of this wickedness that Smith declares in WN that [t]he capricious ambition of kings and ministers has not, during the present and the preceding century, been more fatal to the repose of Europe, than the impertinent jealousy of merchants and manufacturers. (WN, IV.iii.c.9: 493) Indeed, [n]o other sovereigns ever were, or, from the nature of things, ever could be, so perfectly indifferent about the happiness or misery of their subjects, the improvement or waste of their dominions, the glory or disgrace of their administration; as, from irresistible moral

280  Alberto Burgio causes, the greater part of the proprietors of such a mercantile company are, and necessarily must be. (WN, V.i.e.26: 752) The key issue here is that, while little can be done to counter “[t]he violence and injustice of the rulers of mankind,” it is possible to act against “the monopolizing spirit of merchants and manufacturers” to prevent it “from disturbing the tranquillity of any body but themselves” (WN, IV.iii.c.9: 493). This is one of the fundamental duties that Smith entrusts to politics and his motivation to write WN. The work contains innumerable passages in which he calls for measures to counter the damaging operations of magnates. Two examples suffice. Firstly, Smith – the presumed free marketeer – wants the law not to facilitate corporative meetings (given that unfortunately it cannot ban them) of “[p]eople of the same trade,” in which “the conversation ends in a conspiracy against the publick, or in some contrivance to raise prices” (WN, I.x.c.27: 145). Secondly, he wants norms to be promulgated to limit the negative impact on public funds of financial speculation, arguing that the issue here is not the conflict between the “natural liberty” of the subject and the coercion imposed by norms, but the need to prevent “the natural liberty of a few individuals” from threatening “the security of the whole society” (WN, II.ii.94: 324). A structural factor looms large in the background, linked to the fundamental logic of a society in which major capitalists do not merely exert intellectual and moral hegemony over civil society, but de facto also act as its rulers: “the owners of the great mercantile capitals are necessarily the leaders and conductors of the whole industry of every nation” (WN, IV.vii.c.61: 612). On the other hand, it would be Utopian to hope that the problem might be resolved, given that what is at issue here is a fundamental characteristic of this society. Returning to the question of progress, Smith is swift to reject this “absurd” illusion: “To expect, indeed, that the freedom of trade should ever be entirely restored in Great Britain, is as absurd as to expect that an Oceana or Utopia should ever be established in it;” it comes up against not only “the prejudices of the publick” but also “what is much more unconquerable, the private interests of many individuals” (WN, IV.ii.43: 471). Given the enormous power wielded by these individuals, their opposition becomes insurmountable.

4  A severely critical evaluation We can now draw some conclusions from this rapid consideration of Adam Smith’s work. Although it is generally considered to be an apologia for a capitalist market system, it in fact offers a mercilessly critical portrayal of modern “commercial society” and the harmful consequences of

History without providence?  281 possessive individualism. Smith did not detect the early signs of the imminent industrial revolution, but, just as he was putting the final touches to WN, he came into direct contact with the worst social and political aspects of modern capitalism. Drawing on this, he paints a picture of a society rife with conflict and marred by corruption and injustice, an injustice that was a particularly grave matter given that the inequality did not stem from natural differences but from social dynamics (see LJA, vi.47–8: 348; LJB, 220: 493; WN, I.ii.4: 28–9; V.i.f.50: 781–2). If the “wealth of a nation” means the “welfare of its inhabitants,”15 WN does not merely investigate its “nature and causes” but also denounces its many contradictions and distortions. Smith’s narrative is so clearly critical and polemical, as long as one approaches it with an open mind, that it is impossible not to wonder how its tone could have been overlooked, especially given the repeated warnings of authoritative voices such as Amartya Sen (see Sen, 2022: 22–5, but also, earlier, 1988: 22–8). This can only be explained by what fate had in store for Smith, in particular, the ideological role he acquired from the middle of the 20th century. Confusing stadial theory’s idealised view of history with the factual historical analysis of society not only led to a progressivist view of history being attributed to Smith, but it also depicted him as an apologist for an economic system that he in fact “attacked violently.” Circumstances required a great work to be found – indeed, a classic – that would celebrate capitalism and the magnificent and progressive virtues of the free market. WN served this purpose. Smith’s invisible hand suffered the same fate, metamorphosed into a servomechanism, indifferently “spontaneous” or operated by God, that safeguarded the regulatory virtues of the market (see Gramm, 1980; Persky, 1989; Grampp, 2000; Kennedy, 2010). Smith’s perspective on history is clearly influenced by his severely critical view of the society of the day. Deep-seated causes lay at the root of its evils and led to irreversible consequences. There were natural causes, such as a lust for possessions and a yearning for power. There was vanity and an inclination to lie. There was a diabolical “insolence” whereby a man “almost always disdains to use the good instrument, except when he cannot or dare not use the bad one” (WN, V.i.g.19: 799). There were also historical causes. As the dominance of commerce over agriculture and of cities over rural areas stemmed from the “inverted” genesis of modernity, it would be senseless to reduce these effects to epiphenomena (see Bishop, 1995: 171; Fiori, 2014: 61–5; 2021: 98–100). As we noted above, this is why Smith saw as illusory the potential restoration in Great Britain of the free trade that had been suppressed by monopolies. Given these facts, we can draw conclusions about Smith’s position on “progress.” One thing seems to be certain. He did not view history as a triumphal parade. Smith knew that improvements are strenuous, uncertain, and, above all, ambiguous and inconsistent as they inevitably lead

282  Alberto Burgio to decline, have perverse consequences, and cause serious irreversible damage that may outweigh any advantage gained. Robert Heilbroner’s words on the occasion of the bicentenary of WN remain pertinent here: Smith’s great work, often characterized as a paean to “free enterprise,” is in fact a highly qualified tribute, ultimately even a condemnation. The gradient of growth, as we have seen, concludes in a reversion to bare subsistence, therefore the decay of intelligence of the working class cannot be redeemed by a never-ending rise in living standards. […] even during the period of material improvement, the worker must suffer the fate of moral debasement. This prospect is further dimmed because Smith does not believe that the victims of history can rectify matters by taking them into their own hands. […] The idea of a profound revolution, a renversement of society, is neither within the range of Smith’s imagination nor of that of any of his fellow philosophes. Thus beneath the surface assurance that radiates from the book, a distant tragedy of vast proportions – economic decline, moral decay – lurks within The Wealth of Nations. (Heilbroner, 1976: 11; see also 1973) We can therefore confidently conclude that Smith’s view of history was far from Herder’s view of it as “an epic of God’s through all millennia” (Herder, 2002: 336) – unless one sees God as a malign force and his providence as a source of disorder and violence. Smith cites “the eloquent and philosophical bishop of Clermont”: “does it suit the greatness of God, to leave the world which he has created in so universal a disorder?” (TMS, III.5.11: 169; cf. III.2.34: 133). If the notion of providential order in the world and in history reflects an aspiration for “tranquillity” (TMS, III.2.33: 132), this aspiration will not be realised. The bleak view of the morality of modern society stimulates a longing for the comforting embrace of religion while at the same time discrediting it, reducing it to wishful thinking. As noted by Paul Russell, it is hard to believe that “a perfectly benevolent and wise God” might have devised and presided over a “great machine” in which virtue does not lead to happiness (Russell, 2021: 387–8). We mentioned Rousseau earlier, and the reference might not seem pertinent, but it is undeniable that Smith, too, was very aware of the dark side of modernity. Although it is a commonly held view, it is difficult to paint him as the custodian or guardian of the status quo without doing violence to his narrative. It is hard to maintain that he saw “the preservation of the social order” as an objective “of primary importance” (Denis, 2005: 25). Rather, Smith was an intransigent critic of the moral disorder, economic oppression, and social injustice that in his view marred modern society. As noted by Emma Rothschild, he longed for “a friend of the poor,” “the old subversive,” the supporter of the French Revolution,

History without providence?  283 and of “government with the working class” (Rothschild, 1992: 85, 88). Even Ferguson, clearly not the most forgiving critic of modernity, wrote to Smith that he had “provoked […] the church, the universities, and the merchants” in The Wealth of Nations, against all of whom he himself was “willing to take [Smith’s] part” (Corr., 154: 193). Smith’s narrative is a “critical global history” focused on the irrationality and iniquity of the “modern system” (Pitts, 2017), a history dominated by uncertainty and disenchantment, quite the opposite of the “repose and tranquillity of the imagination” that he saw as “the ultimate end of philosophy” (HA, IV.13: 61). The strain between capitalism and community was clear to him, as was the impossibility of curbing “animal spirits.” He saw the future as unexplored territory darkened by the shadow of the poverty of “the great body of the people.” Smith’s position is modern precisely in its harsh criticism of modern secular society and its disenchanted view of history.

Notes 1 Recent theological interpretations include Hill, 2001; Alvey, 2003a; Long, 2006. For examples of the immanentist interpretation, see Kennedy, 2011; Heydt, 2017; Cremaschi, 2018. Smith’s ambiguity is discussed, among others, by Coats, 1992: 139; Rothschild, 1992: 81. 2 For theological interpretations of the invisible hand, see Denis, 2005: 17–25; Oslington, 2011; Hengstmengel, 2019: 164. Immanentist interpretations include Fleischacker, 2004: 44–5, 138–42; Smith, 2006; Kennedy, 2009; Cremaschi, 2017. The possibility that Smith’s use of the invisible hand in TMS and WN is in fact an ironic joke is raised by Emma Rothschild (2001: 117). 3 Gibbon, 1912, vol. VI: 465 (chapter XLI), note 89. A similar view is expressed by Walter Bagehot (1915: 2–3, 8). 4 Forbes, 1954: 643–4, 650. Others that take the same line include Shapiro, 1993: 55–8; Garrett and Hanley, 2015: 253. 5 A similar view is held by Forbes (1954: 647). In the same vein, Justman, 1993: 128; Alvey, 2003b: 2–6; Phillipson, 2010: 70. 6 For an overview of stadial theory, see Wolloch, 2011; Berry, 2015; Marchionatti and Cedrini, 2017: 17–31; Schorr, 2018. 7 Winch, 1978; Haakonssen, 1981. For Meek’s position, see in particular Meek, 1967; 1971; for Skinner’s perspective, see Skinner, 1975; Pascal’s paper – ­possibly the first to speak of a “Scottish Historical School” – is Pascal, 1938. 8 According to Blosser (2019: 25, 34–5), Smith uses “states” as “types” to produce a “static comparison” between the first and the last. See also Paga­ nelli, 2022: 97: I suggest that the stages of society in Smith are simply a pedagogical heuristic, a classification of different kinds of society […]. The four stages are a taxonomy of different relations between means of production and social, moral, political, and legal institutions, not a model of development from one stage to another.
 9 Where Smith applies stadial theory in LJA, he uses “stages” eleven times, “ages” thirty-nine times, and “states” ten times; in LJB the numbers are two, fifteen, and four, respectively.

284  Alberto Burgio 10 Pocock, 2001: 314–5; Berry sees stadial theory as an “ordering-device for the history of institutions” (2015: 35–6). The notion has recently been revisited in Sagar, 2022: 16, 20. 11 On the relationship between the normative (the ideal) and the counterfactual (the hypothetical) in Smith’s stadial theory, see Pesante, 1995: 275–6, 280. 12 Hont, 2005: 373–5. On the counterfactual status of Smith’s stadial sequence, see Marouby, 2004: 33–44. The view that stadial theory consists of ideal types is expressed forcefully in Höpfl, 1978. 13 On the issue of the “internal consistency” of “Smith’s historical theory,” see Bowles, 1985: 117; Blecker, 1997; Brewer, 1998. 14 On Smith’s view of mercantilism as a distortion of the ideal of “commerce,” see Muthu, 2008: 188–92. 15 As proposed by Berry, 2013: 14. On the importance of Smith’s analysis of corruption as an endemic problem of the commercial society of his time, see Tegos, 2013.

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286  Alberto Burgio Hont, I., 2005, “Adam Smith and the Political Economy of the ‘Unnatural and Retrograde’ Order” [1988], in I. Hont, Jealousy of Trade: International Competition and the Nation-State in Historical Perspective, Belknap Press, Cambridge, MA. Justman, S., 1993, The Autonomous Male of Adam Smith, University of Oklahoma Press, Norman, OK. Kennedy, G., 2009, “Adam Smith and the Invisible Hand: From Metaphor to Myth”, Econ Journal Watch, vol. 6, no. 2, pp. 239–63. ———, 2010, “Paul Samuelson and the Invention of the Modern Economics of the Invisible Hand”, Journal of Economic Ideas, vol. 18, no. 3, pp. 105–19. ———, 2011, “The Hidden Adam Smith and His Alleged Theology”, Journal of the History of Economic Thought, vol. 33, no. 3, pp. 385–402. Long, B., 2006, “Adam Smith’s Natural Theology of Society”, The Adam Smith Review, vol. 2, pp. 124–48. Luban, D., 2012, “Adam Smith on Vanity, Domination, and History”, Modern Intellectual History, vol. 9, no. 2, pp. 275–302. Marchionatti, R. & M. Cedrini, 2017, Economics as Social Science. Economics Imperialism and the Challenge of Interdisciplinarity, Routledge, London – New York. Marouby, C., 2004, L’économie de la nature. Essai sur Adam Smith et l’anthropologie de la croissance, Seuil, Paris. Marx, K., 1956, The Poverty of Philosophy [1847], Foreign Languages Publishing House, Moscow. ———, 1887, Capital. A Critical Analysis of Capitalist Production, vol. 1 [1867], trans. S. Moore & E. Aveling, ed. F. Engels, Swan Sonnenschein, Lowrey & Co., London. Meek, R.L., 1967, “The Scottish Contribution to Marxist Sociology” [1954], in R.L. Meek, Economics and Ideology and Other Essays. Studies in the Development of Economic Thought, Chapman and Hall, London, pp. 84–102. ———, 1971, “Smith, Turgot and the ‘Four Stages’ Theory”, History of Political Economy, vol. 3, no. 1, pp. 9–27. Muthu, S., 2008, “Adam Smith’s Critique of International Trading Companies: Theorizing ‘Globalization’ in the Age of Enlightenment”, Political Theory, vol. 36, no. 2, pp. 185–212. Okan, E., 2017, “How Did it All Begin? Adam Smith on the Early and Rude State of Society and the Age of Hunters”, The European Journal of the History of Economic Thought, vol. 24, no. 6, pp. 1247–76. Oslington, P., 2011, “Divine Action, Providence and Adam Smith’s Invisible Hand”, in P. Oslington (ed.), Adam Smith as Theologian, Routledge, New York, pp. 61–75. Pack, S.J., 1995, “Adam Smith’s Unnaturally Natural (Nonetheless Naturally Unnatural) Use of the Word Natural”, in I.H. Rima (ed.), The Classical Tradition in Economic Thought, Edward Elgar, Aldershot, pp. 31–42. ———, 1996, “Slavery, Adam Smith’s Economic Vision and the Invisible Hand”, History of Economic Ideas, vol. 4, no. 1–2, pp. 253–69. Paganelli, M.P., 2022, “Adam Smith and Economic Development in Theory and Practice: A Rejection of Stadial Model?”, Journal of the History of Economic Thought, vol. 44, no. 1, pp. 95–104.

History without providence?  287 Pascal, R., 1938, “Property and Society: The Scottish Historical School of the Eighteenth Century”, Modern Quarterly, vol. 1, no. 2, pp. 167–79. Persky, J., 1989, “Adam Smith’s Invisible Hands”, Journal of Economic Perspectives, vol. 3, no. 4, pp. 195–201. Pesante, M.L., 1995, “La teoria stadiale della storia e l’analisi economica di Adam Smith”, Annali della Fondazione Luigi Einaudi, vol. 29, pp. 249–85. Phillipson, N., 2010, “Language, Sociability, and History: Some Reflections on the Foundations of Adam Smith’s Science of Man”, in S. Collini, R. Whatmore & B. Young (eds.), Economy, Polity, and Society: British Intellectual History, 1750–1950, Cambridge University Press, New York, pp. 70–84. Pitts, J., 2017, “Irony in Adam Smith’s Critical Global History”, Political Theory, vol. 45, no. 2, pp. 141–63. Pocock, J.G.A., 2001, Barbarism and Religion, vol. 2. Narratives of Civil Government, Cambridge University Press, Cambridge. Rasmussen, D.C., 2006, “Does ‘Bettering Our Condition’ Really Make Us Better Off? Adam Smith on Progress and Happiness”, American Political Science Review, vol. 100, no. 3, pp. 309–18. ———, 2013, “Adam Smith and Rousseau: Enlightenment and Counter-Enlightenment”, in C.J. Berry, M.P. Paganelli & C. Smith (eds.), The Oxford Handbook of Adam Smith, Oxford University Press, Oxford, pp. 54–76. Rothschild, E., 1992, “Adam Smith and Conservative Economics”, The Economic History Review, vol. 45, no. 1, pp. 74–96. ———, 2001, Economic Sentiments: Adam Smith, Condorcet and the Enlightenment, Harvard University Press, Cambridge, MA. Rousseau, J.-J., 1992, Discourse on the Sciences and Arts [1750]; and Polemics, trans. R.D. Masters, C. Kelly & J.R. Bush, ed. R.D. Masters & C. Kelly, University Press of New England – Dartmouth College, Hanover, NH. ———, 1999, Discourse on the Origin of Inequality [1754], trans. F. Philip, ed. P. Coleman, Oxford University Press, Oxford. Russell, P., 2021, “Irreligion and the Impartial Spectator in Smith’s Moral System”, in P. Russell, Recasting Hume and Early Modern Philosophy, Oxford University Press, Oxford, pp. 384–402. Sagar, P., 2022, Adam Smith Reconsidered: History, Liberty, and the Foundations of Modern Politics, Princeton University Press, Princeton. Salter, J., 1992, “Adam Smith on Feudalism, Commerce and Slavery”, History of Political Thought, vol. 13, no. 2, pp. 219–41. Schorr, D.B., 2018, “Savagery, Civilization, and Property: Theories of Societal Evolution and Commons Theory”, Theoretical Inquires in Law, vol. 19, no. 2, pp. 507–31. Sen, A., 1988, On Ethics and Economics [1987], Basil Blackwell, New York. ———, 2022, Rationality and Freedom, The Belknap Press of Harvard University Press, Cambridge, MA – London. Shapiro, M.J., 1993, Reading “Adam Smith”: Desire, History, and Value, Sage, Newbury Park, CA. Skinner, A.S., 1975, “Adam Smith: An Economic Interpretation of History”, in A.S. Skinner & T. Wilson (eds.), Essays on Adam Smith, Oxford University Press, Oxford, pp. 154–78. Smith, C., 2006, Adam Smith’s Political Philosophy: The Invisible Hand and Spontaneous Order, Routledge, London.

288  Alberto Burgio Tegos, S., 2013, “Adam Smith: Theorist of Corruption”, in C.J. Berry, M.P. Paganelli & C. Smith (eds.), The Oxford Handbook of Adam Smith, Oxford University Press, Oxford, pp. 353–71. Waterman, A.M.C., 2004, Political Economy and Christian Theology since the Enlightenment. Essays in Intellectual History, Palgrave Macmillan, New York. Winch, D., 1978, Adam Smith’s Politics: An Essay in Historiographic Revision, Cambridge University Press, Cambridge. Wolloch, N., 2011, “The Civilizing Process, Nature, and Stadial Theory”, Eighteenth-Century Studies, vol. 44, no. 2, pp. 245–59.

17 Specialization and commercial modernity Adam Smith as sociologist Lisa Hill

1  Background and introductory comments Adam Smith (1723–1790) is generally thought of as the chief parent of modern economics while his friend and contemporary, Adam Ferguson (1723–1816), is often described as “the father of sociology” (see, for example, Barnes, 1917; Lehmann, 1930; Macrae, 1969; Swingewood, 1970; Hill, 1996). Yet, Smith’s social thought was just as rich and prescient as Ferguson’s and, arguably, more modern. Nevertheless, his status as an early sociologist of commercial modernity is generally overlooked or else mistaken for an aside on his economic thinking, something I seek to correct here. Although it is common for scholars to argue that Smith was influenced by classical discourses,1 I argue in this chapter that his vision was, fundamentally, a modern, sociological one. 2 Smith was a pioneering sociologist of commercial modernity, which I will demonstrate partly by contrasting his thought with that of his more sceptical and classically aligned friend and colleague Adam Ferguson. But I will also be showing that Smith understood then what we all know now: that economically driven behaviour is also sociological behaviour. As Smith saw it, social change is invariably preceded by economic change and the primary variable for effecting this change was task specialization. The “division of labour is naturally introduced” into arts and manufactures “by the prudence of individuals, who find that they promote their private interest better by confining themselves to a particular trade, than by exercising a great number” (WN, V.i.a.14: 697). Specialization and exchange yoked to self-interest are the new social lubricants of commercial society and together, they evoke instrumental mutual-enablement within complex systems of interdependence. I unpack how this happens in the following discussion, highlighting how Smith casts the disruptions occasioned by the division of labour in surprisingly modern and positive terms.

2  Smith versus Ferguson Smith and Ferguson were able to observe the full extent of the changes brought on by commercialization and modernization because Scotland DOI: 10.4324/9781003301448-22

290  Lisa Hill rapidly became a commercial society during the second-half of the 18th century (Strasser, 1976: 53). They were in an ideal position to record and analyse the encroaching effects of commercial modernity and the massive social shifts it brought with it, including the breakdown of traditional social and political units like the feudal estate and the extended family; the centralization and bureaucratization of government; the regularization and professionalization of security and justice; significant increases in productive output; the geographical concentration of manufacture and the concomitant urbanization of populations; the division of the manufacturing population into either owners/employers of wage labour or workers; growing consumerism; and an expanding middle class. Therefore, it is hardly surprising that Scottish Enlightenment figures like Smith and Ferguson were the first to articulate what were among the first authentic sociologies (Eriksson, 1993: 252) and, in particular, the first sociologies of “capitalist civilization” (Corrigan & Sayer, 1985: 104). Smith and Ferguson were the most important and influential figures here and their disagreements about how such change should be interpreted is explored within this chapter as a way of throwing light on just how prescient was Smith’s sociology of commercial modernity. Like most sociologists today, Smith and Ferguson were both fascinated by social change and they studied the dynamics of civil society as a kind of organism that was capable of self-equilibration and forward movement. Indeed, civil society was their primary unit of analysis and both saw it as a structure that was at once organized and self-organizing (Hill, 2020; 2021). But they were particularly interested in how societies were equilibrating and functioning under the rapid changes brought by commercial progress and here is where they parted company because, although Smith sees these changes as both natural and adaptive, Ferguson does not share Smith’s optimism that these changes were always positive and equilibrating. Despite being a cautious progressivist (Ferguson, 1792, vol. I: 191), Ferguson was extremely concerned about the costs to the social fabric of commercial “progress” (Hill, 1997). The new prosperity of the “polished age” may have brought luxury, comfort, and “convenience,” but it also harboured the possibility of social decay and “a kind of spontaneous return to obscurity and weakness” (Ferguson, 1995: 198). Disruption and disequilibrium seemed more likely. Contrary to the claims of some that Smith shares in Ferguson’s apparent pessimism about the commercial age (e.g. Heilbroner, 1973; Pack, 1991; Brown, 1994; Winch, 1997), Smith’s was a more complacent conception of the emerging world of commerce and modernity. While the two agreed that the market was an integral part of civil society, they disagreed on how large a role it should play. Smith saw the market as synonymous with civil society, and he hoped it would keep expanding to the point where it either pushed out or dominated other aspects of civil

Specialization and commercial modernity  291 society he saw as increasingly redundant and even obstructive. Yet, these were the very same aspects of which Ferguson feared the loss: intimate social cultures, passionate group loyalties, other-regardingness, political activism, and martial service. The market economy touted by Smith as the solution to a multitude of social and economic evils, including corruption (Hill, 2019) was, for, Ferguson a mixed blessing that was just as likely to cause corruption, understood in the classical sense as loss of civic virtue leading to national decline (Ferguson, 1995: 174–5; 206–7). According to Ferguson, when civil society is enervated by the virtue-sapping, apathy-inducing effects of specialized market life, the emergence of military government becomes possible, even likely. Whereas for Smith, an expanding market protects civil society from the potentially noxious power of the state (Hill, 2019), for Ferguson, a key threat to civil society comes from the market itself which harboured the sinister seeds of despotism. And unlike Smith, who saw history as an inexorable march towards better and more refined states of social and political effectiveness (see below), Ferguson is more cautious. Progress brings some gains in political condition but it also brings costs. On the one hand, there is an expansion of freedom and legal rights as well as a diffusion of wealth and therefore economic independence, all of which can enable and enrich political society (Ferguson, 1995: 247). Yet, on the other hand, progress and market society damage the social fabric by undermining social cohesion and the solidary passions. This occurs because specialized, profit and production-driven citizens are deprived of opportunities to practice and express their civic – and especially martial – virtue. It therefore operated as a primary source of political decline due to its corrosive effects on statecraft, martial and political disposition, and defence capability (Ferguson, 1995: 206–7). Commercialism might be capable of delivering the material comfort and security that Smith celebrated, but in doing so, it also dispensed a kind of fatal “poison” to the moral health of the polity (Ferguson, 1995: 80). The impersonal contractualism of Smith’s market society is given an alternative gloss in Ferguson’s hands as “introduc[ing] the spirit of traffic into the commerce of affection;” similarly, Smith’s “growing sensibility to interest” was nothing more than an invitation to “consider kindness itself as a task” (Ferguson, 1995: 15–19; 88). It is not self-interest but the disinterested passions of altruism, friendship, patriotism, military valour, and spontaneous trust that hold the social fabric together, says Ferguson, and these passions are all imperilled by commercial modernity (Ferguson, 1792, vol. I: 29). Ferguson was also less interested than Smith in the economic effects of specialization, focusing instead on its adverse social ramifications. While the social and work-function division of labour gave us greater refinement in mechanical and artistic skills (Ferguson, 1995: 173–4), it also delivered modes of work blighted by what late-modern thinkers

292  Lisa Hill would label “alienation,” particularly in its alienation from “speciesbeing,” process alienation, and social alienation variations. As Ferguson observed with dismay, Britain was rapidly turning into a company of manufacturers, where each is confined to a particular branch, and sunk into the habits and peculiarities of his trade […]. We furnish good work; but educate men, gross, sordid, void of sentiment and manners. (Ferguson, 1756: 12) In a striking anticipation of Marx, who identified the first theorist of alienation (Marx, 1969: 129–30), Ferguson explains how factory labour causes workers to become mindless cogs in an inhuman machine. Many mechanical arts […] require no capacity; they succeed best under a total suppression of sentiment and reason […] manufactures prosper most where the mind is least consulted, and where the workshop may […] be considered as an engine, the parts of which are men. (Ferguson, 1995: 174) Marx also identifies Ferguson as the originator of the argument that in order to make the collective labourer, and through him capital, rich in social productive power, each labourer must be made poor in individual productive powers. (Marx, 1977: 341–2) Commercial forms of production are antithetical to Ferguson’s ideal of meaningful work whereby people are bound to no task […] are left to follow the disposition of the mind, and to take that part in society, to which they are led by the sentiments of the heart, or by the calls of the public. (Ferguson, 1995: 176) Not only does the technical separation of tasks lead to social alienation; so too does the social division of labour that naturally follows in its wake. By social alienation, Ferguson means it in the same sense as described by Marx, namely the separation between society and the state that always takes place in commercial societies (Drosos, 1996: 328). For Ferguson, the division of labour leads to state centralization and bureaucratization and both trends inevitably limit a person’s inclination and capacity to be civically active. This dynamic erodes something far more valuable than wealth: moral community (Ferguson, 1995: 179). As Ferguson puts it:

Specialization and commercial modernity  293 [t]he members of a community may […] be made to lose the sense of every connection […] and have no common affairs to transact but those of trade […] in which the national spirit […] cannot be exerted. (Ferguson, 1995: 208) The specialization and professionalization of armies further exacerbate this unvirtuous effect. In contrast to pre-commercial societies where shared defence responsibilities rendered “the public” a cosy “knot of friends” (Ferguson, 1995: 208), specialized commercial agents are isolated and separated by their distance from the state, their lack of martial valour, their individuated desires for “riches” and their deep “aversion to danger,” all of which amounts to a lack of commitment to public affairs (Ferguson, 1995: 231). In simple (that is, “savage” and “barbarous”) societies, “the public” was bound together by a sense of common danger (Ferguson, 1995: 208); each male citizen was responsible for the defence of common territory and this gave rise to the vital bonds that constitute and preserve community. This resulted in communities of “faithful, disinterested [and] generous” friends (Ferguson, 1995: 26–9). But in modern states, the development of professional standing armies and the concomitant rise of labouring and merchant classes freed from security responsibilities and at liberty to devote themselves entirely to the pursuit of private interests, “commercial spirit” supersedes civic spirit; the “admiration, and desire of riches” inevitably brings with it “an aversion to danger” (Ferguson, 1995: 231). Whereas in small-scale, pre-commercial societies the “intercourses of men” are “friendly […] affectionate and happy” (Ferguson, 1995: 104), in commercial orders avarice, individualism, competition, and legalism corrode spontaneous affection. Social relationships are now defined and limited by contract and the pursuit of profit. In “polished” or commercial society man is sometimes found a detached and solitary being: he has found an object which sets him in competition with his fellow creatures, and he deals with them as he does with his cattle and his soil, for the sake of the profits they bring. (Ferguson, 1995: 24; cf. Ferguson, 1792, vol. II: 376–7) Notably, unlike Smith, Ferguson does not rate the prosperity of societies according to such quantitative indicators as wealth, food supply, child mortality rates, or population levels (Hill, 2019). Rather, he uses the classical Stoic index of the moral and civic disposition of its citizenry (Ferguson, 1995: 62). Civil society is characterized by an active public and a constitution capable of embracing and promoting political and military participation (Ferguson, 1792, vol. II: 509). Yet, under the effects of progress, the populace becomes “disunited and corrupted and

294  Lisa Hill incapable of public affections” in direct “consequence of their numbers” (Ferguson, 1978: 242–4). Task specialization alienates people “from the common scene of occupation, on which the sentiments of the heart, and the mind, are most happily employed” and eventually “society is made to consist of parts, of which none is animated with the spirit of society itself” (Ferguson, 1995: 207). Overall then, whereas Smith believed that a well-developed system of divided labour tended to generate what Durkheim would later refer to as a kind of organic solidarity (see below) Ferguson saw it as exerting the opposite effect. In commercializing nations like Britain, the “bands” of friendship were starting to evince a worryingly “feeble texture” compared with “the resolute ardour with which [pre-commercial] man adheres to his friend, or to his tribe” (Ferguson, 1995: 22–3).

3  Smith on specialization For Smith, the main variable driving social change was an economic one: the mechanization and specialization of labour. It brought upheavals of immense sociological significance of which Smith offered a masterful account, including the myriad subtle and almost undetectable alterations in the way people lived, thought and psychologically operated. Smith, by no means oblivious to its negative side effects (see Hill, 2007), nevertheless, thought that, on balance, specialization should be embraced because it is socially integrating, and the cause of almost all the positive social change he documented and theorized. More than that, it is a perfectly natural – and therefore desirable – development originating in our inventive faculties, coupled with our innate urge to “truck, barter, and exchange” (WN, I.ii.1: 25). Specialization not only generates wealth and technical and artistic refinement but alters profoundly the social fabric, notably, for the better. It is in his discussion of the latter set of effects that Smith really shines as an early sociologist. Unlike Ferguson, he does not see the capacity of specialization for social disruption as a bad thing because the social systems it slowly yet irresistibly broke down were all maladaptive obstructions to freedom, progress, and prosperity. This disruption is effected by the workings of specialization in two seemingly opposed directions. First, specialization allows a greater degree of social distance between individual agents who can now produce and trade with all and sundry. On the other, it also enhances and expands (impersonal) integration because it drives the demand for more and more goods from more and more strangers. In this way, it exponentially enlarges the networks of amicable “commercial strangership” that Smith welcomes. As Michael Ignatieff points out, for Smith, “only a society of strangers, of mediated and indirect social relations,” had “the dynamism to achieve progress” (Ignatieff, 1984: 119).

Specialization and commercial modernity  295 The more people specialize and trade, the less dependent they become on others, especially those who previously exerted archaic forms of power over them. Commercial specializers no longer have to rely for their survival on their capacity to cultivate the “good will” of others but are increasingly independent – as well as interdependent – because each “stands at all times in need of the co-operation and assistance of great multitudes” (ED, 22: 571). This generates an impersonal but more dependable and ubiquitous form of social cohesion among societies of distant strangers (WN, I.ii.1–3: 25–8). Apparently oblivious to how most other species really behaved, Smith suggests that other species are destined to lead solitary lives because they are unable to divide their labour and trade the surpluses. Humans are unique in knowing how to specialize and then to make trades of the surpluses for the goods they need. The result is increased interaction and impersonal interdependence (WN, I.ii.5: 30) creating mutual need and therefore social integration. The end result is abundance and prosperity (LJA, vi.46–49: 348–9; WN, I.ii.1–3: 25–8). Every workman has a great quantity of his own work to dispose of beyond what he himself has occasion for; and every other workman being exactly in the same situation, he is enabled to exchange a great quantity of his own goods for […] the price of a great quantity of theirs. He supplies them abundantly with what they have occasion for, and they accommodate him as amply with what he has occasion for, and a general plenty diffuses itself through all the different ranks of the society. (WN, I.i.10: 22) By dividing our labour, we perform it more efficiently and, in the process, “ease the labour of the species” and make ourselves “mutually beneficiall to each other” (LJA, vi.49: 349). The learned “philosopher” and hardworking “porter” who seem to have little in common and will likely never cross paths, nevertheless, assist each other impersonally and indirectly on a daily basis; the porter by “packing, carrying, and unpacking the goods which fill the shops” and supply the philosopher with his every need, while the philosopher “benefits the porter not only as being occasionally a customer, but by the improvements he makes in the different arts;” indeed “[e]very one who burns coals or eats bread is benefitted by the philosopher who invented the fire engine or the corn mill” (LJA, vi.49: 349). Strangers of the “most dissimilar geniuses are” therefore “of use to one another” in the impersonal market where our desire to specialize is usefully allied with the “disposition to truck, barter, and exchange” (WN, I.ii.5: 30). What Smith is effectively offering us here is a sociology of the transition from social arrangements based on “mechanistic” solidarity and

296  Lisa Hill homogeneity to those characterized by “organic” solidarity and heterogeneity (Jary & Jary, 1991: 389). Obviously, these terms were not in use in the 18th century; nevertheless, they are apposite. In fact, Durkheim commenced his Division of Labour in Society by acknowledging his debt to Smith and rating him “the first to attempt to elaborate the theory” of the division of labour (Durkheim, 1984: 1). The two thinkers also agreed that specialization was nothing to be feared but a positive “evolution” that occurred “spontaneously and unthinkingly” (Durkheim, 1984: 1). The terms “mechanical” and “organic solidarity” denote the distinction drawn by Durkheim “between two types of social solidarity.” The first – “mechanical” – is “based on the similarity between individuals” and is the type that dominates “simple societies.” The second – “organic solidarity” – is “based on the division of labour and complementarities between individuals” and occurs mainly in “modern advanced societies” (Jary & Jary, 1991: 389). This shift from mechanical to organic solidarity is precisely what Smith is describing. In the process, the society nurtures even greater levels of genius and accomplishment as well an explosion in the types of genius and accomplishment. As he wrote in the Wealth of Nations: in “rude” societies that “preced[e] the improvement of manufactures, and the extension of foreign commerce” the “varied occupations of every man oblige every man to exert his capacity, and to invent expedients for removing difficulties which are continually occurring” (WN, V.i.f.51: 783). Differentiation is rare; instead, “every man […] is a warrior. Every man too is in some measure a statesman,” and so on, but “[i]n such a society […] no man can well acquire that improved and refined understanding, which a few men sometimes possess in a more civilized state;” “in a rude society there is a good deal of variety in the occupations of every individual” but “there is not a great deal in those of the whole society” because “[e]very man does, or is capable of doing, almost every thing which any other man does, or is capable of doing,” but in a “civilized” society, by contrast, “there is little variety in the occupations of the greater part of individuals” yet “an almost infinite variety in those of the whole society” (WN, V.i.f.51: 783). This trend pushes development forward and enhances the interdependence of specializers. Specialization not only integrates more and more differentiated individuals; it also – and at the same time – liberates individual agents from the intimate but stifling social structures upon which their survival once depended but which are now no longer adaptive or conducive to productivity, liberty, or progress. Smith acutely observes how the division of labour operates as a powerful dissolver of small-scale social structures like the extended family, the tribal community, and the feudal estate, driving the tendency towards mass society, expanding markets, and economic cosmopolitanism. For example, in pre-commercial societies, people preserved extended family networks largely for the purpose

Specialization and commercial modernity  297 of “common defence” but, in commercial societies, the presence of a specialized and bureaucratized system of justice and defence provides adequate protection to everyone, right down to the “meanest man in the state” (TMS, VI.ii.1.12–13: 222–3). With the exigencies of security addressed, families, over time, “naturally separate and disperse” and “in a few generations” lose all contact and remembrance of one another (TMS, VI.ii.1.13: 223). The division of labour played a particularly important role in the “silent and insensible” demise of feudalism, an especially restrictive, unproductive, dependency-generating, and maladaptive social structure (WN, III.iv.10: 418–9). Whereas under a feudal economy, wealth could only be used to support retainers for the purposes of either hospitality or military security, the proliferation and refinement of consumer goods caused the feudal barons to bankrupt themselves in the pursuit of luxury goods. The labour power of the previously indolent but increasingly independent serfs began to be employed in more productive ways. This social “revolution” gave birth to a new class of “merchants and artificers” whose material and moral influence brought about greater liberty and a more equitable distribution of power (WN, III.iv.5: 412–4; III. iv.11–18: 419–22). It also significantly enhanced production because one of the disadvantages of “menial” labour performed inside dependency relationships – and therefore outside market relations – is that it is not very productive. This is because it does not generally produce “vendible” or exchangeable commodities (Perelman, 1989: 507). Furthermore, because it avoids the “waste which attends rustick hospitality,” the labour performed under commercial conditions is capable of supporting far greater numbers of people (WN, III.iv.12: 420). Freedom from the system of great landholders also offered greater levels of economic security to individual traders because “[e]ach tradesman or artificer” can now “deriv[e] his subsistence from the employment, not of one, but of a hundred or a thousand different customers;” this spreads individual risk because “he is not absolutely dependent upon any one of them” (WN, III.iv.12: 420). As specialization pushes markets ever-outwards in their natural tendency, social and economic networks become increasingly less frustrated by the fear and “jealousy of strangers” that once held back archaic societies (WN, I.x.c.22: 142). Instead, every stranger is neutral, a potential co-contractor, buyer, seller, or role-pair candidate – for example, seller and buyer, lawyer and client, teacher and pupil, or doctor and patient – with whom we are more than happy to engage in the impersonal market (Silver, 1990). Rational self-interest displaces unreliable benevolence as the chief source of individual survival and national prosperity. [M]an has almost constant occasion for the help of his brethren, and it is in vain for him to expect it from their benevolence only. He

298  Lisa Hill will be more likely to prevail if he can interest their self-love in his favour, and shew them that it is for their own advantage to do for him what he requires of them. Whoever offers to another a bargain of any kind, proposes to do this. Give me that which I want, and you shall have this which you want, is the meaning of every such offer; and it is in this manner that we obtain from one another the far greater part of those good offices which we stand in need of. It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from their regard to their own interest. (WN, I.ii.2: 26–7) Contra Ferguson’s account, the division of labour enhances social life precisely because of its destructive effect on paternalistic and dependency-generating pre-commercial social forms that were antithetical to the kinds of freedom and individual self-sufficiency Smith valued. The ability of humans to specialize and exchange the products of this specialization with strangers holds mass commercial society together while simultaneously releasing individuals from their erstwhile oppressive dependencies. The more we specialize, the more economically successful and independent we become yet, at the same time, the more interdependent with the rest of society because specializing renders us less able to meet our own complex material needs, making us more needy of more and more impersonal others (WN, I.ii.1–3: 25–8). The inevitable loss of social intimacy is well worth the price, says Smith, when he asks as to compare the dismal privations of the “savage” age (TMS, V.2.9: 205) with the “general security and happiness which prevail in ages of civility and politeness” (TMS, V.2.8: 205). And even if specialized modernity did exacerbate social inequalities – which Smith readily concedes it unfortunately does – this is not too high a price to pay because even the “lowest and most despised member of civilized society” enjoys a level of “affluence and abundance” far superior to “the most respected and active savage” (ED, 6: 564). Further, while economic inequality may be exacerbated by commercialism, market society still provides relief from the kind of involuntary, inescapable, and “servile dependency upon” social “superiors” that economically disabled archaic societies (WN, III.iv.4: 412). Specialization is therefore indispensable to human flourishing and happiness, which Smith conceives pragmatically as a function of two conditions that market society is uniquely capable of delivering: liberty and material abundance (TMS, III.5.7: 166; I.iii.2.1: 51; WN, I.viii.36: 96). In terms of progressing and securing commercial societies, Smith identified one final and crucial benefit of specialization: its evident capacity – via professional and technically refined standing armies – to guarantee stable government and resolve the security problem posed to commercial states by the “violence and injustice of other independent societies” (WN,

Specialization and commercial modernity  299 V.i.a.42: 707). In order to ensure high standards of military defence and to avoid the evil of perpetually withdrawing productive workers from the economy and into military service during national emergencies, “it is necessary” that the art of war “should become the sole or principal occupation of a particular class of citizens;” in fact, “the division of labour is as necessary for the improvement of this, as of every other art” (WN, V.i.a.14: 697). Standing armies also support commerce because they are better able to protect the enticing prosperity of “opulent and civilized” nations from external threat (WN, V.i.a.44: 708). Internal state security, meanwhile, is achieved by the development of formal systems of justice and “well-regulated” standing armies to execute and maintain that justice (WN, V.i.a.41: 707). A standing army establishes, with an irresistible force, the law of the sovereign through the remotest provinces of the empire, and maintains some degree of regular government in countries which could not otherwise admit of any. (WN, V.i.a.40: 706) When there are regular armies to support an organized system of justice, this provides invaluable support “to industry” of which “the only encouragement […] require[d]” is “some tolerable security that it shall enjoy the fruits of its own labour” (WN, I.xi.n.1: 256; see also WN, I.xi.g.6: 213–4). When “freedom and security” is guaranteed, “[t]he natural effort of every individual to better his own condition” achieves its full capacity to render the society prosperous and happy (WN, IV.v.b.43: 540). Both domestic strife and war and inter-state friction “are extremely hurtfull” to trade, commerce and “public opulence” (LJB, 264: 512). Once justice and police is guaranteed, security and commerce enter into a virtuous circle; “commerce and manufactures” is what “gradually introduced order and good government” (WN, III.iv.4: 412) and security, in turn, is what drives commerce ever-forward. Via this perpetual feedback mechanism, “the liberty and security” of people who had formerly lived “almost in a continual state of war with their neighbours” is achieved; along with freedom from servile dependencies, this is the most valuable and “important” consequence of commercial development (WN, III.iv.4: 412). Contrary to the belief of Ferguson, who strongly favoured militias on the grounds that they preserved social cohesion, civic virtue and liberty, Smith was keen to emphasize that centralized and professionalized standing armies in no way infringed on the liberties of private citizens; in fact, they significantly enhanced them. Smith’s position infuriated Ferguson who wrote him an angry letter on the subject: “The gentlemen and peasants of this country do not need the authority of philosophers

300  Lisa Hill to make them supine and negligent of every resource they might have in themselves” (Corr., 154: 194). Smith saw it differently: although specialization might derogate from the martial virtue that Ferguson regarded as the best guarantee of liberty, he nevertheless believed that the overall liberty trade-off was on the side of regular armies. A sovereign who enjoys the “security” of an extensive, professional and well-armed military is free from “that troublesome jealousy” that causes less secure governors perpetually “to watch over the minutest actions” and be perpetually primed to “disturb the peace of every citizen.” In turns out that the militarily insecure state is more likely to be the repressive, overbearing state: Where the security of the magistrate […] is endangered by every popular discontent; where a small tumult is capable of bringing about in a few hours a great revolution, the whole authority of government must be employed to suppress and punish every murmur and complaint against it. (WN, V.i.a.41: 707) But “the sovereign” who knows “he” is “supported […] by a wellregulated standing army” is completely undisturbed by “the rudest, the most groundless, and the most licentious remonstrances;” rather, “[h]e can safely pardon or neglect them, and his consciousness of his own superiority naturally disposes him to do so” (WN, V.i.a.41: 707). As justice and police is gradually taken out of the often arbitrary and unreliable hands of decentralized archaic authority figures (patriarchs, feudal lords, chiefs and ecclesiastics) into more formal, impartial, and centralized structures, individual freedom, paradoxically becomes greater and more and more diffuse. As Smith says, in societies “where the sovereign is secured by a well-regulated standing army,” people enjoy a “degree of liberty which approaches to licentiousness” and which “can be tolerated only in [such] countries” (WN, V.i.a.41: 707). And where justice is regularized and professionalized, arbitrary forms of power are harder to wield. After all, formal justice is precise and its rules are highly impersonal, impartial, predictable, and accurate: its rules […] are accurate in the highest degree, and admit of no exceptions or modifications […]. If I owe a man ten pounds, justice requires that I should precisely pay him ten pounds […]. (TMS, III.6.9–10: 174–5). Standing armies were to Smith a very effective way of avoiding the evil of investing the “sovereign” with “discretionary power” as a means for ensuring the “publick safety” (WN, V.i.41: 707). The standing army was not just the best way of adequately defending a commercially advanced

Specialization and commercial modernity  301 “civilized” country; it was also the only means by which a “barbarous country can be suddenly and tolerably civilized” (WN, V.i.a.40: 706). Commercial societies are more orderly than their “rude and barbarous” antecedents and this is partly due to the development of regular systems of justice and police, but it is also the effect of the diffusion of “probity and punctuality” that “always accompan[ies]” the development of commerce; in fact, the more commercial a nation, the more are its people “faithfull to their word” (LJB, 326: 538). Compared with inhabitants of archaic societies, independent commercial agents are better self-regulators, more orderly, pacific, and law-abiding because commercial societies are more impersonal and rule-driven. In a mass society regulated by specialized institutions of justice, people naturally become more prudent and circumspect in their dealings with others. Self-interest leads every member of commercial orders to protect their reputation and to scrupulously “observ[e] every engagement” (LJB, 327: 538). Specialization therefore effects changes in almost every aspect of life, often in subtle and unseen ways. One such effect is Smith’s orderly, impersonal, pacific, legalistic society inhabited by moderate, tolerant, dispassionate, law-abiding, and self-governing individuals. It is a self-equilibrating marketplace where conflict between its moving parts is rare. The night-watchman state for which Smith is famous is the natural corollary of this new and cordial way of relating and the politically quiescent public of independent producers its economic and social bedrock. On this account, there are only three proper duties of government that, although of “great importance, [are] plain and intelligible to common understandings”: first, to protect society from the invasion of other societies (defence); second, to establish and administer a system of justice; and third, to provide essential public works and infrastructure (WN, IV.ix.51: 687–8). Beyond this, the new civil society of the market and the internal regulation of market actors via the new commercial virtues would be sufficient for order and progress. Therefore, for Smith, specialization only unravelled the social fabric in the short term by unpicking its maladaptive knots, expanding it in multiple directions, smoothing it out, and sewing it back up again. It made the market the main site of public activity and caused it to self-equilibrate in a myriad of different ways. Furthermore, it offered escape from the disagreeable drudgery of a mean, uncertain, and constrained world towards one that was more predictable, secure, stable, civilized, and prosperous. The fact that the new world is rather impersonal and that just about everyone we happen to deal with in the course of the day is a stranger is by no means a problem; in fact, Smith seems happy to characterize Britain as an “assembly of strangers” (TMS, I.i.4.9: 23). He is also complacent about the fact that the personalism, fierce loyalties, and other-regarding virtues of archaic social forms approved by Ferguson were no longer needed due to their inability to supply our many and

302  Lisa Hill increasingly complex needs. Better, says Smith, to rely on self-interest and modern commercial virtues like temperate and reliable prudence, propriety, probity, and justice (TMS, III.6.9: 174; Berry, 1992) and the open, rational, impersonal, and rule-governed behaviours of specialized strangers determined to trade with and get along with one another for mutual benefit. In the marketplace of independent, internally selfregulating actors, the free play of these drives and dispositions maximizes liberty, including the liberty to trade with whomever it suits us, which was the surest route to a flourishing society. Neither was the fact that self-interested actors were often in competition with each other an obstacle to the new “commercial strangership,” Smith observed and theorized, because in the commercial age, we have to school ourselves through necessity to the virtues of civility, self-command, politeness, mutual forbearance, independence, “equality of temper,” and all the other impersonal and self-controlled modes of interaction requisite to market success (TMS, III.3.25: 146; I.i.4.10: 23). Indeed, this is what makes Smith’s sociology of commercialism so subtle because he was interested to show how self-interested, utilitymaximizing strangers competing in increasingly differentiated, mass societies could still, not only to get along, but benefit one another and the society more generally. For Smith, the good citizen is not the avid warrior but a somewhat more mild-mannered character whose virtue consists mainly in a “respect” for laws, obedience to “the civil magistrate” and a generalized, but not particularly energetic, interest in “the welfare of the whole society” (TMS, VI.ii.2.11: 231). “The prudent man,” though not especially laudable, “confines himself, as much as his duty will permit, to his own affairs” and is “averse to enter into any party disputes” (TMS, VI.i.13: 215). The civic realm must shrink to make way for the burgeoning market that specialization has opened up. This law-abiding, private, self-regarding, temperate, and commercially preoccupied archetype is far removed from Ferguson’s ideal of the other-regarding, passionate, and public-spirited citizen-warrior. As Ferguson noted derisively, care of the self, “retirement from public affairs,” and devotion to the “virtues” of prudence and propriety can hardly deserve those “applauses of moderation and virtue” all too commonly granted in polite society (Ferguson, 1995: 243).

4 Conclusion Although Smith certainly recognized the moral and social disadvantages of specialization, he ultimately rejects the simple social forms admired by Ferguson in favour of those forged by specialization: large scale, non-particularistic communities based on civilized strangership, “calculation,” “self-interest,” and regulated by impartial justice. In this

Specialization and commercial modernity  303 increasingly differentiated society, it is social distance and impersonalism, not social intimacy, that Smith wanted to promote. He regretfully acknowledges the loss of civic virtue, classically understood, as a consequence of specialization; yet, on balance, believes that material prosperity has moral priority; economic citizenship is preferable to, and more useful than, the political variety. The new voluntaristic mass market society brought on by specialization is to be welcomed because it lacks the intensity and exclusivity of archaic societies and is capable of exponentially widening the circles of friendship beyond the narrow confines of clan, kinship, clientage, and security alliances. It is also more conducive to liberty, prosperity, security, technical and artistic refinement, and human flourishing. Rather than harking back to antiquity, Smith offers us a vision that presciently and definitively points to the commercial future.

Notes 1 Particularly Stoic thought. See, for example, Clarke, 2000 and Maurer, 2016. 2 While I do not dispute that Smith read and was influenced by classical sources, I have argued elsewhere that he adapted classical thinking for modern intellectual purposes. See Hill, 2022.

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304  Lisa Hill ———, 1978, Institutes of Moral Philosophy. For the Use of Students in the College of Edinburgh, A. Kincaid & J. Bell, Edinburgh, 1769; repr. Garland Publishing Company, New York. ———, 1995, An Essay on the History of Civil Society [1767], ed. F. Oz-Salzberger, Cambridge University Press, Cambridge. Heilbroner, R.L., 1973, “The Paradox of Progress: Decline and Decay in the Wealth of Nations”, Journal of the History of Ideas, vol. 34, no. 2, pp. 243–62. Hill, L., 1996, “Anticipations of Nineteenth and Twentieth Century Social Thought in the Work of Adam Ferguson”, European Journal of Sociology, vol. 37, no. 1, pp. 203–22. ———, 1997, “Adam Ferguson and the Paradox of Progress and Decline”, History of Political Thought, vol. 18, no. 4, pp. 677–706. ———, 2006, The Passionate Society: The Social, Political and Moral Thought of Adam Ferguson, Springer, Berlin – New York. ———, 2007, “Adam Smith, Adam Ferguson and Karl Marx on the Division of Labour”, Journal of Classical Sociology, vol. 7, no. 3, pp. 339–66. ———, 2019, Adam Smith’s Pragmatic Liberalism, The Science of Welfare, Palgrave MacMillan, London – New York. ———, 2020, “Civil Society Theory: Adam Smith”, in H.K. Anheier & S. Toepler (eds.), International Encyclopedia of Civil Society, Springer Publications, New York, pp. 450–4. ———, 2021, “Civil Society Theory: Adam Ferguson”, in R.A. List, H.K. Anheier & S. Toepler (eds.), International Encyclopedia of Civil Society, Springer Publications, New York, pp. 400–4. ———, 2022, “Adam Smith: Stoic and Epicurean”, in P. Sagar (ed.), Interpreting Adam Smith: Critical Essays, Cambridge University Press, Cambridge (forthcoming). Ignatieff, M., 1984, The Needs of Strangers, Chatto & Windus, London. Jary, D. & J. Jary (eds.), 1991, The Collins Dictionary of Sociology, Harper Collins, Glasgow. Lehmann, W., 1930, Adam Ferguson and the Beginnings of Modern Sociology, Columbia University Press, New York. MacRae, D., 1969, “Adam Ferguson”, in T. Raison (ed.), The Founding Fathers of Social Science, Penguin Books, London, pp. 17–26. Marx, K., 1977, Capital: A Critique of Political Economy, vol. I [1867], Progress Publishers, Moscow. ———, 1996, The Poverty of Philosophy [1847], with an Introduction by F. Engels, International Publishers, New York. Maurer, C., 2016, “Stoicism and the Scottish Enlightenment”, in J. Sellars (ed.), The Routledge Handbook of the Stoic Tradition, Routledge, New York, pp. 254–69. Pack, S.J., 1991, Capitalism as a Moral System: Adam Smith’s Critique of the Free Market Economy, Edward Elgar, Aldershot. Perelman, M., 1989, “Adam Smith and Dependent Social Relations”, History of Political Economy, vol. 21, no. 3, pp. 503–20.

Specialization and commercial modernity  305 Silver, A., 1990, “Friendship in Commercial Society: Eighteenth-century Social Theory and Modern Sociology”, American Journal of Sociology, vol. 95, no. 6, pp. 1474–504. Strasser, H., 1976, The Normative Structure of Sociology: Conservative and Emancipatory Themes in Social Thought, Routledge & Kegan Paul, London. Swingewood, A., 1970, “Origins of Sociology: The Case of the Scottish Enlightenment”, The British Journal of Sociology, vol. 21, no. 2, pp. 164–80. Winch, D., 1997, “Adam Smith’s Problem and Ours”, Scottish Journal of Political Economy, vol. 44, no. 4, pp. 384–402.

18 Smith and the savages in the Wealth of Nations, or the anthropology of political economy Roberto Marchionatti 1  The “savage problem” in Adam Smith’s work In the “Introduction and Plan of the Work” of the Wealth of Nations, primitive or savage “rude” societies1 are represented in negative terms as the opposite of civilized societies – a theme that runs through the entire Smith opus. In fact, every book of the Wealth of Nations, with the exception of the short Book III “Of the different Progress of Opulence in different Nations,” includes mentions, discussions, or comparisons of primitive and civilized societies. 2 In all these passages, the fundamental feature of primitive societies is their state of wretchedness, rudeness, poverty, and distress, as opposed to civilized nations with their wealth, “opulence and prosperity” (WN, I.viii.23: 88). They are the “early and rude state of society” (WN, I.vi.1: 65), that is, the first stage of human society’s evolution in the Smithian theory of four stages of development. At the beginning of the opus, introducing the issue of what regulates the proportion between the national product and the number of those who are to consume it, Smith offers a gloomy picture of primitive society, as opposed to civilized societies. He writes that: Among the savage nations of hunters and fishers, every individual who is able to work, is more or less employed in useful labour, and endeavours to provide, as well as he can, the necessaries and conveniences of life, for himself, or such of his family or tribe as are either too old, or too young, or too infirm to go a hunting and fishing. Such nations, however, are so miserably poor, that, from mere want, they are frequently reduced, or, at least, think themselves reduced, to the necessity sometimes of directly destroying, and sometimes of abandoning their infants, their old people, and those afflicted with lingering diseases, to perish with hunger, or to be devoured by wild beasts. Among civilized and thriving nations, on the contrary, though a great number of people do not labour at all, many of whom consume the produce of ten times, frequently of a hundred times more labour than the greater part of those who work; yet the produce of the whole labour of the society is so great, that all are

DOI: 10.4324/9781003301448-23

Anthropology of political economy  307 often abundantly supplied, and a workman, even of the lowest and poorest order, if he is frugal and industrious, may enjoy a greater share of the necessaries and conveniences of life than it is possible for any savage to acquire. (WN, intro. & plan.4: 10) In Book I, Chapter XI, Smith specifies that [a]mong savage and barbarous nations, a hundredth or little more than a hundredth part of the labour of the whole year, will be sufficient to provide them with such cloathing and lodging as satisfy the greater part of the people. All the other ninety-nine parts [of the labour of the whole year] are frequently no more than enough to provide them with food. (WN, I.xi.c.6: 180) In summary, according to Smith, the fundamental characteristic of primitive society is economic backwardness: a society of misery and scarce resources, where the search for food is the main daily activity and it is not possible to produce a surplus, except occasionally. This poverty, Smith adds, is also the fundamental cause of the absence of the state – the second, traditional, opposition considered by Smith is that between societies without a state and societies with a state, the latter category, including civil societies.3 Life in savage societies is, in Smith’s narrative of the Wealth of Nations, an endless struggle against starvation: they are intrinsically incapable of producing a surplus, and, as a consequence, are unable to build a state, that is, an adequate institutional framework. This is a mistaken representation, as contemporary anthropology and archeology has shown – see the classic Stone Age Economics (Sahlins, 1972; Marchio­ natti & Cedrini, 2017).4 In fact, many chronicles of the travelers, explorers, and missionaries of the late 16th, 17th, and 18th centuries – from Jean de Léry’s and André Thevet’s accounts of native peoples of Brazil, which were at the basis of Montaigne’s Essais on cannibals, to Gabriel Sagard’s, Pierre François Xavier de Charlevoix’s and Joseph-François Lafitau’s works on North American Indians, and to James Cook’s and Louis-Antoine de Bougainville’s accounts of Pacific Ocean peoples, to mention just some of the most important descriptions of the peoples of new worlds, with some of which Smith was familiar – were full of praise for people’s good health and the abundance and variety of things to eat, and the little time devoted to work.5 These early writers’ accounts and impressions have been strikingly confirmed by contemporary research. Modern anthropology shows that though primitive societies do not produce a stable surplus, this is not because they are incapable of doing so, entirely absorbed as they are in producing the minimum necessary

308  Roberto Marchionatti for survival, for subsistence; on the contrary, primitive societies demonstrate a great ability to satisfy their needs even if they devote relatively little time to work, and even so, they do not die of hunger. It follows that the subsistence economy of savages is compatible with a substantial limitation of the time given to productive activities. Contemporary studies that have measured the time spent working in societies with a subsistence economy, whether they are nomad hunters of the Kalahari Desert, or Amerindian sedentary agriculturists, find that an average of about four to five hours per day are allotted to ordinary work (see Marchionatti & Cedrini, 2017 for a review of the literature). It has thus become possible to speak of groups of paleolithic hunters and gatherers as “the first affluent societies,” in Marshall Sahlins’s playfully apt words.6 On the other hand, examining Smith’s writings preceding the Wealth of Nations, in particular his philosophical works, it is clear that there are elements of a positive representation of savage societies, far from that presented in the 1776 book. This rosier view is undoubtedly influenced by his ethnological sources, Charlevoix and Lafitau in primis. Examining Rousseau’s ideas in his Letter to the Authors of the Edinburgh Review (1756) – by the way, this letter shows Smith’s engagement with modern European philosophical currents in the mid-1750s – Smith acknowledges that a positive perspective on savages is justified. He writes that: The life of a savage, when we take a distant view of it, seems to be a life either of profound indolence, or of great and astonishing adventures; and both these qualities serve to render the description of it agreeable to the imagination. (Letter, 12: 251) Rousseau, Smith said, intended to “paint the savage life as the happiest of any,” by presenting “only the indolent side of it to view, which he exhibits indeed with the most beautiful and agreeable colours” (Letter, 12: 251). This is the Rousseauian direction that seems to be taken in a passage contained in one of his Smith’s Essays on Philosophical Subjects, written in the mid-1700s, “Of the Nature of that Imitation which takes place in what are called The Imitative Arts. Of the Affinity between Music, Dancing and Poetry,” which refers to the abundance of free time in “the most barbarous nations” – he mentions “the negroes of Africa” and “the savage tribes of America” – free time that savages devoted to music and dancing. Smith writes: Among savage nations, the great body of the people have frequently great intervals of leisure, and they have scarce any other amusement; they naturally, therefore, spend a great part of their time in almost the only one they have. (IA, II.1: 187).

Anthropology of political economy  309 This abundance of free time is, of course, inconceivable in the framework whereby savages are represented in the Wealth of Nations.7 In the Theory of Moral Sentiments several noble features of savages are strongly stressed. While noting the harsh living conditions of individuals in primitive societies, their moral values are contrasted with those of civilized societies. In Part V of the Theory, “Of the Influence of Custom and Fashion upon the Sentiments of Moral Approbation and Disapprobation,” Smith writes in Chapter II, “Of the Influence of Custom and Fashion upon Moral Sentiments” that, while “[a]mong civilized nations, the virtues which are founded upon humanity, are more cultivated than those which are founded upon self-denial and the command of the passions,” among “rude and barbarous nations, it is quite otherwise, the virtues of self-denial are more cultivated than those of humanity” (TMS, V.2.8: 204–5). Smith seems to explain this difference by referring to the rude way of savage life: Every savage undergoes a sort of Spartan discipline, and by the necessity of his situation is inured to every sort of hardship. He is in continual danger: he is often exposed to the greatest extremities of hunger, and frequently dies of pure want. His circumstances not only habituate him to every sort of distress, but teach him to give way to none of the passions which that distress is apt to excite. He can expect from his countrymen no sympathy or indulgence for such weakness. Before we can feel much for others, we must in some measure be at ease ourselves. If our own misery pinches us very severely, we have no leisure to attend to that of our neighbour: and all savages are too much occupied with their own wants and necessities, to give much attention to those of another person. (TMS, V.2.9: 205) From this quotation, it seems at first that the savages’ virtues are the necessary result of their state of material poverty. However, as Smith’s account develops, the emphasis on the positive value of self-denial as opposed to the situation in civilized societies, emerges: a “heroic and unconquerable firmness,” as he later terms it, “which the custom and education of his country demand of every savage” (TMS, V.2.10: 207), a virtue that is lost in civilized society. The picture of a savage indifferent to his own fate resembles that of the ancient Stoic. This affinity has been stressed in the literature. For example, Harkin writes that the characterization of the Stoic, with his “contempt of life and death” and a complete “submission to the order of Providence,” discussed in the Theory, “evokes strong parallels with the North American savages” (Harkin, 2005: 439).8 As some authors have hypothesized (see Harkin, 2005; Marouby, 2007; Marchionatti, 2008; Cremaschi, 2017; see also Marchionatti & Cedrini

310  Roberto Marchionatti 2017), passages in Smith like those mentioned above suggest that Smith’s thought shows an unresolved mix of attraction and condemnation for the primitive, and thus a tension between the representation given in the Wealth of Nations (the image of wretchedness and distress) and the positive appraisal of savages’ life and morality presented in other writings: the latter being an admirable alternative to the modern form of subjectivity, though it must be said that the positive representation does not become an alternative paradigm.9 What is clear is that, as Marouby emphasizes, a comparison between Smith’s ethnographic sources and his own anthropology reveals “a pattern of selections, of misreadings or interpretative moves, and of outright omissions” (Marouby, 2007: 87). Actually, in the Wealth of Nations the “ignoble savage” narrative becomes dominant. Here, only a single reference remains to a positive characterization of the savage man, that is, to his mental ability and inventiveness. In Smith’s discourse, misery, poverty, and the absence of the state depend on there being no division of labor, but it is precisely because there is no division of labor that the unique features attributed to savage society in the Wealth of Nations can exist. In savage societies, the varied occupations of every man oblige every man to exert his capacity, and to invent expedients for removing difficulties which are continually occurring. Invention is kept alive, and the mind is not suffered to fall into that drowsy stupidity, which, in a civilized society, seems to benumb the understanding of almost all the inferior ranks of people. In those barbarous societies, as they are called, every man […] is a warrior. Every man too is in some measure a statesman, and can form a tolerable judgement concerning the interest of the society, and the conduct of those who govern it. How far their chiefs are good judges in peace, or good leaders in war, is obvious to the observation of almost every single man among them. (WN V.i.f.51: 783) In this connection, it should be emphasized that the opposition between divided and undivided man, which was then taken up by Marx, was drawn at that time by many scholars, from Louis-Armand de Lahontan in the books on his voyages in North America, to Adam Ferguson in his Essay on the History of Civil Society (1767) and to Thomas Jefferson in his Notes on the State of Virginia (1784), and was associated with a tradition of admiration for savage man that started with Montaigne. Nevertheless, this positive aspect has very limited space in the Wealth of Nations. In conclusion, we must recognize that though there are different narratives about savages in Smith’s works, negative representations predominate in the Wealth of Nations. The positive representation, coherent

Anthropology of political economy  311 with coeval ethnological descriptions and not rarely combined with a criticism of civilized society, prevails in Smith’s pre-1760s writings, while in the economic discourse of Wealth of Nations, the negative aspects of savage society dominate the narrative, as the positive ones are essentially marginal. The question that arises is: how can we explain the passage from one narrative to the other and Smith’s shift to minimizing the positive characterization of savages in the Wealth of Nations? The transition from one narrative to the other takes places in the 1760s with Smith’s theoretical systematization of the four-stage theory – his theory of socioeconomic development – and the beginning of Smith’s construction of the science of political economy, as part of his discourse on the ideological foundation of capitalism and its benefits.10

2 In the making of the Wealth of Nations: Smith’s interpretation of history and the representation of primitive societies in the Lectures on Jurisprudence and the Draft In its most general form, the four-stage theory maintained that the key factor in the process of historical development is “the mode of subsistence,” a concept Montesquieu introduced in De l’esprit des lois (1748),11 thus giving an ‘economic’ interpretation of human evolution. More specifically, the theory states that a society naturally progresses over time through four stages, “ideal types” each of which corresponds to a different mode of subsistence: hunting, pasturage, agriculture, and commerce, all with different sets of institutions, laws, and customs. In light of more or less limited historical evidence, this approach replaced facts with conjectures based on a philosophical analysis of human nature: Dugald Stewart called this type of investigation “Conjectural History” (Life, II.48: 293).12 According to Meek, Smith used an early version of the theory of four stages for the first time in a course of lectures that he gave in Edinburgh in 1750–1751 and then in 1752–1753 in his jurisprudence course at the University of Glasgow; recently, Pauchant (2016) predated the first use to Smith’s 1749 Glasgow lectures. However, it was only from the beginning of the 1760s that the four-stage theory appeared in a “highly sophisticated version” (Meek, 1976: 107): this was in Smith’s jurisprudence course at Glasgow in 1762–3, as Meek writes, “to illuminate a wide range of problems relating to the history of law and government” (1976: 107). Here Smith gave a complete formulation of his conjectural history and anthropology, in connection – this is the relevant fact – with the emergence of the project of the Wealth of Nations. The theory of four stages is introduced at the beginning of the Lectures on Jurisprudence (LJA) when Smith deals with the problem of the

312  Roberto Marchionatti origin of property rights, from a perspective differing from Locke’s and Hobbes’s contractarian theories. He writes that: There are four distinct states which mankind pass thro: —1st, the Age of Hunters; 2dly, the Age of Shepherds; 3dly, the Age of Agriculture; and 4thly, the Age of Commerce. (LJA, i.27: 14) Then Smith, before proceeding to use his theory to explain the changes in “laws and regulations with regard to property,” which occur as society develops, describes a fictional original state of mankind and then the other stages as a result of the effect of population growth and the search for adequate modes of subsistence. In a long passage, he writes: If we should suppose 10 or 12 persons of different sexes settled in an uninhabited island, the first method they would fall upon for their sustenance would be to support themselves by the wild fruits and wild animalls which the country afforded. Their sole business would be hunting the wild beasts or catching the fishes. […] This is the age of hunters. In process of time, as their numbers multiplied, they would find the chase too precarious for their support. They would be necessitated to contrive some other method whereby to support themselves. […] The most naturally contrivance they would think of, would be to tame some of those wild animalls they caught, and by affording them better food than what they could get elsewhere they would enduce them to continue about their land themselves and multiply their kind. Hence would arise the age of shepherds. They would more probably begin first by multiplying animalls than vegetables, as less skill and observation would be required. Nothing more than to know what food suited them. We find accordingly that in almost all countries the age of shepherds preceded that of agriculture. […] Flocks and herds therefore are the first resource men would take themselves to when they found difficulty in subsisting by the chase. But when a society becomes numerous they would find a difficulty in supporting themselves by herds and flocks. Then they would naturally turn themselves to the cultivation of land and the raising of such plants and trees as produced nourishment fit for them. They would observe that those seeds which fell on the dry bare soil or on the rocks seldom came to any thing, but that those[s] which entered the soil generally produced a plant and bore seed similar to that which was sown. These observations they would extend to the different plants and trees they found produced agreable and nourishing food. And by this means they would gradually advance in to the age of agriculture. As society was farther

Anthropology of political economy  313 improved, the severall arts, which at first would be exercised by each individual as far as was necessary for his welfare, would be seperated; some persons would cultivate one and others, as they severally inclined. They would exchange with one an other what they produced more than was necessary for their support, and get in exchange for them the commodities they stood in need of and did not produce themselves. This exchange of commodities extends in time not only betwixt the individualls of the same society but betwixt those of different nations. […] Thus at last the age of commerce arises. When therefore a country is stored with all the flocks and herds it can support, the land cultivated so as to produce all the grain and other commodities necessary for our subsistance it can be brought to bear, or at least as much as supports the inhabitants when the superfluous products whether of nature or art are exported and other necessary ones brought in exchange, such a society has done all in its power towards its ease and convenience. (LJA, i.27–32: 14–6) In the four-stage evolution of mankind, savage societies are “the lowest and rudest” state of society. This is a conjectural representation developed in the Early Draft, which was a sketch of the first chapters of Wealth of Nations, written about 1763 and based on the economic material included in his Lectures.13 The main explanatory categories used there were the concepts of the division of labor and (market) exchange. In the Draft, Smith develops his theory by starting from a comparison between savage and civilized societies. He compares “an Indian prince, the absolute master of the lives and liberties of a thousand naked savages” and “a common day labourer in Britain or in Holland” (ED, 1: 562). Smith maintains that the luxury of the laborer “is much superior” to that of the savage, and this circumstance must be explained. It is, he argues, a paradox, because it should be natural to expect that among the savages, where “every individual enjoys the whole produce of his own industry,” he “should have a much greater affluence of the necessaries and conveniences of life than can be possessed by the inferior ranks of people in a civilized society” (ED, 4: 563), but experience, Smith writes, demonstrates the contrary. The concept introduced by Smith to explain this paradox is that of “division of labour”: The division of labour, by which each individual confines himself to a particular branch of business, can alone account for that superior opulence which takes place in civilized societies, and which, notwithstanding the inequality of property, extends itself to the lowest member of the community. (ED, 6: 564)

314  Roberto Marchionatti The “immense multiplication of the productions,” which “occasions in all civilized societies that universal opulence which extends itself to the lowest ranks of the people” (ED, 10: 566) is the consequence of the division of labor, Smith maintains. In this situation, each man, he writes, “performs so great a quantity” of his particular kind of work that he can both afford something to those who do not labour at all, and at the same time have as much behind as will enable him, by exchanging it for the productions of other arts, to supply himself with all the necessaries and conveniences which he stands in need of. (ED, 10: 566) “This immense increase of the quantity of work performed, in consequence of the division of labour,” Smith continues, is owing to “three different circumstances”: First, to the increase of dexterity in every particular workman; secondly, to the saving of the time which is lost in passing from one species of work to another; and last of all, to the invention of innumerable machines, which facilitate labour and enable one workman to do the business of many. (ED, 13: 567) With the division of labor, a man does not produce all the goods he needs for his subsistence; therefore, Smith continues, he has to purchase the other goods through exchange with other men in the market. The relationship between division of labor and the market presented in the Draft was fully developed in the first chapters of the Wealth of Nations.

3 Division of labor, (market) exchange, and human nature in the Wealth of Nations The concepts of division of labor and (market) exchange, which Smith introduces in the Draft as the main explanatory categories in his theory of human progress, are also the two fundamental concepts of the new political economy, adopted to explain the origin of the Wealth of Nations, and fully investigated in their virtuous relationship in the 1776 book. The division of labor, as Smith clearly explains in Book I, Chapter IV, makes every man a merchant and the society a commercial society: When the division of labour has been once thoroughly established, it is but a very small part of a man’s wants which the produce of his own labour can supply. He supplies the far greater part of them by exchanging that surplus part of the produce of his own labour, which is over and above his own consumption, for such parts of the produce of other men’s labour as he has occasion for. Every man

Anthropology of political economy  315 thus lives by exchanging, or becomes in some measure a merchant, and the society itself grows to be what is properly a commercial society. (WN, I.iv.1: 37, italics added) The main theoretical question Smith deals with is the relationship between the division of labor and the market: it is precisely expressed – in what then was called by the American economist Allyn Young “the theorem that the division of labour is limited by the extent of the market” (1928: 533) – in Book I, Chapter III, which emphasizes the virtuous circle between the two categories: the extent of [the] division [of labour] must always be limited […] by the extent of the market. When the market is very small, no person can have any encouragement to dedicate himself entirely to one employment, for want of the power to exchange all that surplus part of the produce of its own labour, which is over and above his own consumption, for such parts of the produce of other men’s labour as he has occasion for. (WN, I.iii.1: 31) The extent of this relationship explains the opulence of civilized societies, and, on the other hand, its absence explains the existence of a state of economic backwardness, of which primitive, uncivilized, societies are the typical expression. What causes the extension of the market in commercial societies? Smith asks. And he answers: here, the market is extended as an effect of the free action of individual interest. In Book IV, devoted to the different systems of that “branch of the science of a statesman” called political economy (WN, IV.intro.1: 428), Smith writes that every individual acts in order “to find out the most advantageous employment for whatever capital he can command,” and in doing, so he has “his own advantage” in mind (WN, IV.ii.4: 454). Smith then adds an extremely relevant comment: “the study of his own advantage, naturally, or rather necessarily leads him to prefer that employment which is most advantageous to the society” (WN, IV.ii.4: 454, italics added). In fact, shortly afterward, Smith introduces the famous passage of the “invisible hand”: he intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention. Nor is it always the worse for the society that it was no part of it. By pursuing his own interest he frequently promotes that of the society more effectually than when he really intends to promote it. (WN, IV.ii.9: 456, italics added)

316  Roberto Marchionatti The system where [e]very man, as long as he does not violate the laws of justice, is left perfectly free to pursue his own interest his own way, and to bring both his industry and capital into competition with those of any other man, is defined by Smith as “the obvious and simple system of natural liberty” (WN, IV.ix.51: 687), or “the liberal plan of equality, liberty and justice” (WN, IV.ix.3: 664) – note that, as James Buchanan (1976) has emphasized, Adam Smith’s system of natural liberty, interpreted as his idealized paradigm for social order, embodies justice as well as economic efficiency. We should note the central role that individual interest plays in these passages. As mentioned earlier (see note 10), Hirschman (1977) persuasively interpreted this preeminence above the other passions as the final achievement of the tradition of political nature on the benefits of capitalism. But Smith goes further. Market society, where every man “is left perfectly free to pursue his own interest his own way” (WN, IV.ix.51: 687), makes it possible – this is Smith’s thesis – to establish the system of natural liberty, natural because it guarantees the operation of “a certain propensity in human nature”: “the propensity to truck, barter, and exchange one thing for another” (WN, I.ii.1: 25), already mentioned in the Lectures. In fact, Smith in Book I, Chapter II of the Wealth of Nations introduces “the Principle which gives occasion to the Division of Labour” – the key factor in social development and the cause of the wealth of nations. Smith writes: This division of labour, from which so many advantages are derived, is not originally the effect of any human wisdom, which foresees and intends that general opulence to which it gives occasion. It is the necessary, though very slow and gradual consequence of a certain propensity in human nature which has in view no such extensive utility; the propensity to truck, barter, and exchange one thing for another. (WN, I.ii.1: 25, italics added) Smith continues by maintaining that this principle is not an original principle in human nature but rather, probably, the “consequence of the faculties of reason and speech,” and it is common to all men, while it is found “in no other race of animals” (WN, I.ii.2: 25). Smith argues thus: In civilized society [man] stands at all times in need of the cooperation and assistance of great multitudes […] man has almost constant occasion for the help of his brethren, and it is in vain for him to expect it from their benevolence only. He will be more likely to

Anthropology of political economy  317 prevail if he can interest their self-love in his favour, and shew them that it is for their own advantage to do for him what he requires of them. Whoever offers to another a bargain of any kind, proposes to do this. Give me that which I want, and you shall have this which you want, is the meaning of every such offer; and it is in this manner that we obtain from one another the far greater part of those good offices which we stand in need of. It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from their regard to their own interest. We address ourselves, not to their humanity but to their self-love, and never talk to them of our own necessities but of their advantages. […] As it is by treaty, by barter, and by purchase, that we obtain from one another the greater part of those mutual good offices which we stand in need of, so it is this same trucking disposition which originally gives occasion to the division of labour. (WN, I.ii.2–3: 26–7) Smith had posed the question of the origin of this propensity in the Glasgow Lectures, connecting it with the human tendency to persuade. He writes: If we should enquire into the principle in the human mind on which this disposition of trucking is founded, it is clearly the naturall inclination every one has to persuade. The offering of a shilling […] is in reality offering an argument to persuade one to do so and so as it is for his interest. (LJA, vi.56: 352) And again: When any arguments are offered to perswade, it is always expected that they should have their proper effect. If a person asserts any thing about the moon, tho’ it should not be true, he will feel a kind of uneasiness in being contradicted, and would be very glad that the person he is endeavouring to perswade should be of the same way of thinking with himself. We ought then mainly to cultivate the power of perswasion, and indeed we do so without intending it. Since a whole life is spent in the exercise of it, a ready method of bargaining whith each other must undoubtedly be attained. (LJB, 221–2: 493–4) Smith’s reasoning was intended to persuade the reader of the natural origin of the division of labor and exchange, and therefore of the naturalness of commercial society. But, at the same time, his reasoning seeks to persuade the reader that there is a historical continuity between

318  Roberto Marchionatti primitive and commercial societies. According to Smith, primitive or savage society, as the initial stage of human history, already contains the propensity of human nature to truck, barter, and exchange. So it is a propensity possessed by both the savage and the civilized man, but, what is relevant, to different extents because of the different level of the division of labor, which determines different stages of development, and hence the inferiority of savage society compared with the civilized age of commerce. In the Wealth of Nations, Smith emphasizes this commensurability and similarity: just after maintaining that the trucking disposition originally gave rise to the division of labor, he introduces an imaginary bartering savage – a passage that, we may say, is a clear example of Smith’s abuse of the conjectural method: In a tribe of hunters or shepherds a particular person makes bows and arrows, for example, with more readiness and dexterity than any other. He frequently exchanges them for cattle or for venison with his companions; and he finds at last that he can in this manner get more cattle and venison, than if he himself went to the field to catch them. From a regard to his own interest, therefore, the making of bows and arrows grows to be his chief business, and he becomes a sort of armourer. Another excels in making the frames and covers of their little huts or moveable houses. He is accustomed to be of use in this way to his neighbours, who reward him in the same manner with cattle and with venison, till at last he finds it his interest to dedicate himself entirely to this employment, and to become a sort of house-carpenter. In the same manner a third becomes a smith or a brazier, a fourth, a tanner or dresser of hides or skins, the principal part of the clothing of savages. And thus the certainty of being able to exchange all that surplus part of the produce of his own labour, which is over and above his own consumption, for such parts of the produce of other men’s labour as he may have occasion for, encourages every man to apply himself to a particular occupation, and to cultivate and bring to perfection whatever talent or genius he may possess for that particular species of business. (WN, I.ii.3: 27–8)

4 Smith’s conjectural anthropology and political economy, or the anthropological basis of Smith’s economic theory. Concluding remarks In the construction of his thought in the 1760s, Smith gave rise to a potent economistic interpretation of human societies’ evolution founded on the concepts of division of labor and (market) exchange, whose extension makes it possible to establish commercial society, or the society of opulence (the fourth stage), as the end point of human evolution, and

Anthropology of political economy  319 its starting point as primitive society, or the society of inevitable backwardness. This is the sociological and anthropological framework of the new “science” of political economy. It can be considered the “science of commercial society.” At the same time, political economy aspires to general validity in order to explain human behavior in every society – and herein lie the distant origins of the imperialism of economics (see Marchionatti & Cedrini, 2017). And political economy’s aspiration to general validity depends on the fact that Smith conceives commercial society as that society that assures the completion of human nature, which fully manifests itself in “the system of natural liberty.” As a consequence, the theoretical categories of political economy must reflect this naturalness. In fact, what sets in motion the virtuous mechanism of the division of labor/(market) exchange is the fact that man, by his very nature, has a propensity “to truck, barter, and exchange one thing for another.” This nature can fully develop only when technological and institutional constraints disappear thanks to the development of the division of labor, thus enabling exchange to develop and to trigger that virtuous mechanism. As we have said, the four-stage theory is the frame of reference for this vision. From this perspective, the conjectural anthropology elaborated by Smith, ethnologically largely unfounded but instrumental to this theoretical framework, can be considered the (conjectural) anthropology of political economy,14 which, in turn, serves Smith’s political project of illustrating and emphasizing the benefits of capitalism. However, to maintain this theoretical and ideological construction, Smith abuses the conjectural method. He reconstructs a fictitious exchange among savages, which in fact is simply a simplified market exchange, or barter. He ‘justifies’ his method of proceeding on the basis of the supposed naturalness of the propensity to exchange. But what is this exchange that Smith discusses? He is talking about a very general and abstract concept of exchange regarded as equivalent to market exchange, logically equating the form of primitive and commercial exchange. In this way, Smith disregards precisely the form of exchange that characterizes primitive societies, the gift exchange, founded on reciprocity, as shown by Marcel Mauss in his Essai sur le don (1924) that reveals the opposition between the two forms of exchange (see Cedrini & Marchionatti, 2017; Cedrini, Ambrosino, Marchionatti & Caillé, 2020).15 In Smith’s narrative, the fate of the savage is sealed, confined as he is in the rude and primitive stage of material poverty. But a different narrative is possible, and it was also possible in Smith’s days: we refer to that of Denis Diderot, an author who, as Meek (1976: 97) writes, was not “affected” by the theory of stages. In the chapters attributed to him of Abbé Raynal’s Histoire philosophique et politique des établissements et du commerce des Européens dans les deux Indes16, the French philosopher offered an alternative description of North American savages

320  Roberto Marchionatti that was more ethnologically founded than that of Adam Smith (based on many sources, partly the same as Smith’s but probably larger in number, from Lafitau and Charlevoix to Lahontan), beyond the myths of the noble and ignoble savage. In Book XV, Chapter 4 of the Histoire, Diderot describes the environment and the material life of the Indians, remarking on their different activities – not only hunting and fishing but also husbandry and gathering – the long intervals of time devoted to inaction, feast and dances, the rudeness of their life, and, at the same time, the state of abundance in which they lived, due not only to the large seasonal availability of foods, but also to their cultural and social attitude – their wants were few, Diderot stresses, and they feel the moral duty to mutual assistance. This is not presented as necessary for survival, as did Smith and most subsequent economists and economic anthropologists: according to Diderot, the explanation for this social relation lies in the political dimension, where the absence of coercive power guaranteed independence and equality. Thus another narrative was possible. However, Diderot’s narrative fell into oblivion, while the Smithian narrative proved successful and provided the early anthropological basis of the new science of political economy, long a-critically accepted by most economists and social scientists after Smith.17

Notes 1 The terminology used by Smith varied: “barbarous and uncivilized state” (WN, I.iii.8: 36); “that early and rude state of society” (WN, I.vi.1: 65); “that original state of things” (WN, I.viii.2: 82). 2 In Book I, the comparison is introduced in Chapter I, after the pin factory passage, and in Chapter XI, “Of the Rent of Land” (WN, I.xi.a: 160). In Book II, it appears in a long opening passage in the Introduction. In Book IV, the comparison appears toward the end of the first chapter. In Book V, the comparison appears in the first paragraph. 3 The limited amount of property in such a poor society – “there is scarce any property, or at least none that exceeds the value of two or three days labour” – does not generate major conflicts, or, as Smith writes, there are no great “injuries to property” (WN, V.i.b.2: 709), and so there is no need for civil government or administration of justice. Therefore, among the savages, Smith writes, “there is properly neither sovereign nor commonwealth” (WN, V.i.a.2: 690), “there is seldom any established magistrate or any regular administration of justice” (WN, V.i.b.2: 709); age is the only basis of authority: [a]mong nations of hunters, such as the native tribes of North America, age is the sole foundation of rank and precedency. Among them, father is the appellation of a superior; brother, of an equal; and son, of an inferior. (WN, V.i.b.6: 711) It is the situation of “[u]niversal poverty” that “establishes there universal equality,” and “the superiority, either of age, or of personal qualities, are the feeble, but the sole foundations of authority and subordination” (WN,

Anthropology of political economy  321 V.i.b.7: 712). By contrast, in wealthy civilized societies, where there is “valuable and extensive property” (WN, V.i.b.2: 710), civil government must be established. 4 See in particular Marchionatti and Cedrini 2017: 110–26 for a review of the debate on Sahlins’s Stone Age Economics. For an evaluation of the relevance of Stone Age Economics, see Cedrini and Marchionatti, 2021. 5 These travel accounts influenced philosophical thinking from Montaigne to Rousseau, Diderot and the Scottish Enlightenment philosophers. As far as we know, Adam Smith had a good knowledge of this travel literature. His library (see Bonar, 1966) contained the most important collections of voyages: the Royal Society’s Philosophical Transactions, and other more or lesser known travelers’ accounts. He possessed Charlevoix’s Histoire de la Nouvelle France (1744) and Lafitau’s Histoire des découvertes et des conquestes des Portugais dans le Nouveau Monde (1733). Lafitau’s fundamental Moeurs des sauvages amériquains (1724) was not included in Smith’s library. However, we know that he was familiar with that text because it as well as Charlevoix’s Histoire are the sources mentioned in Smith’s discussion of savages in his Glasgow Lectures. Marouby (2007) lists all of Smith’s ethnographic sources in the appendix to his paper – both works explicitly referenced by Smith and other works in Smith’s library. It is likely that Lafitau’s and Charlevoix’s descriptions of the savage nations of North America, which noted the ethical and social merits of primitives, impressed Smith greatly and were at the basis of the passages, in both the Theory of Moral Sentiments and, to a lesser extent, in Wealth of Nations, referring to the losses entailed by the move to commercial society. 6 At the same time, it is a misconception that savage societies are “societies without a state”: Pierre Clastres (1974) has masterfully shown they are better defined as societies against the state. Taking on the question of power in his La Société contre l’État, Clastres showed that regimes other than the State model do indeed exist, and they existed long before ours, where power is nonetheless noncoercive. In such societies, political culture, and cultural practices are not only not submissive to the State model, but they actively avert it, rendering impossible the very conditions in which coercive power and the State could arise. 7 Actually, it could be interpreted referring to another fundamental Smith source, Montesquieu, who had emphasized that savages enjoyed a certain abundance, partly due to the natural fertility of the earth: The cause of there being such a number of savage nations in America is the fertility of the earth, which spontaneously produces many fruits capable of affording them nourishment. If the women cultivate a spot of land round their cottages, the maize grows up presently; and the hunting and fishing put the men in a state of complete abundance. (Montesquieu, 1949: 275n.) This reference could explain why, in spite of a supposedly feeble economic structure, these savage societies do not need to work the entire day. Nevertheless, this seems to recognize that they can have a leisure life, a picture opposite to that given in the Wealth of Nations. 8 Harkin writes: The prestige and prominence Smith accords the Stoics in his moral system is increased in the sixth and final edition of the Theory in 1790, where he expands the treatment of Stoic philosophy in his concluding survey of different ethical systems and gives them this commendation:

322  Roberto Marchionatti ‘The spirit and manhood of their doctrines make a wonderful contrast with the desponding, whining and plaintive tone of some modern systems’. Smith overtly links the Stoics to the American Indians, both of whom are ready to face the ‘calamities’ of life with equanimity, and notes that both share a contempt for ‘life and death [...] and, at the same time, the most entire submission to the order of providence’ . (Harkin, 2005: 440) Bee and Paganelli (2019) express a different view, suggesting that Smith criticized, rather than embracing that Stoic self-command in commercial societies. 9 Actually, Harkin’s opinion, viz., that in looking at the relationship between the modern and the savage, we can “read Smith both as a believer in history as progress toward commercial civilization and as a Rousseauvian elegist of a lost social harmony” (Harkin, 2005: 436), seems to go too far. 10 On this point, Hirschman, 2013, which maintained that Smith’s Wealth of Nations must be considered the final achievement of a long intellectual tradition of a mainly political nature on the benefits of capitalism, is still fundamental (see Sen, 2013). The first step in this tradition, in Hirschman’s reconstruction, was Montesquieu’s De l’esprit des lois. Its opening reflections were based on the dichotomy between passions and interests. In this vision, Hirschman writes, “the age of commerce,” which will then culminate in the development of capitalism, was to be praised for its capacity to “improve the political order,” by counteracting socially harmful passions. In the Wealth of Nations, by contrast, Smith apparently dissolves all passions into a self-motivated devotion to material wealth and its accumulation. To reconcile passions and interests, Hirschman continues, Smith seems compelled to argue that even the political ambition to gain power is satisfied by economic betterment, and that, more in general, non-economic drives are at the service of economic impulses, which they nurture and strengthen – this being Smith’s political grand narrative. 11 In book XVIII of the De l’esprit des lois, Montesquieu introduced the concept of “manner of procuring subsistence” in order to explain why savage nations had a less extensive code of laws than those of nations of traders or peasants. Montesquieu’s concept influenced many contemporaneous authors, like Turgot, Smith, Ferguson, Robertson, who elaborated on the new theory of socioeconomic development of societies. 12 The issue, as formulated by Smith’s biographer Dugald Stewart, to describe the methodology adopted by Smith in Considerations Concerning the First Formation of Languages, and by David Hume in the Natural History of Religion, was the following: Whence [...] the different forms which civilized society has assumed in different ages of the world? On most of these subjects very little information is to be expected from history […]. A few insulated facts may perhaps be collected from the casual observations of travellers, who have viewed the arrangements of rude nations; but nothing, it is evident, can be obtained in this way, which approaches to a regular and connected detail of human improvement. […] In such inquiries, the detached facts which travels and voyages afford us, may frequently serve as land-marks to our speculations; and sometimes our conclusions a priori, may tend to confirm the credibility of facts, which, on a superficial view, appeared to be doubtful or incredible. (Life, II.45–46: 292–3)

Anthropology of political economy  323 13 The Draft was “a preliminary […] attempt by Smith to translate the ‘economic’ material in his Jurisprudence lectures into book form – an attempt which he probably made at some time shortly before April 1763” (Meek, Raphael & Stein, 1978). 14 Marouby, 2007 makes a similar point. 15 While Smith conjecturally reconstructs archaic societies from the standpoint of civilized societies, Mauss takes the opposite approach: he describes the actual working of archaic societies, emphasizing the nonlinearity of the path toward market societies. 16 Diderot’s contribution to the Histoire des Deux Indes accounts for approximately one-third of the 1780 edition, according to Duchet’s reconstruction (1978). 17 For the interpretation of primitive societies by economists after Smith (from Marx to the neoclassical economists), see Marchionatti, 2008; Marchionatti, 2012; Marchionatti and Cedrini, 2017.

References Bee, M. & M.P. Paganelli, 2019, “Adam Smith, Anti-Stoic”, History of European Ideas, vol. 45, no. 4, pp. 572–84. Bonar, J., 1966, A Catalogue of the Library of Adam Smith [1932], Macmillan, London. Buchanan, J.M., 1976, “The Justice of Natural Liberty”, The Journal of Legal Studies, vol. 5, no. 1, pp. 1–16. Cedrini, M. & R. Marchionatti, 2017, “On the Theoretical and Practical Relevance of the Concept of Gift to the Development of a Non-imperialist Economics”, Review of Radical Political Economics, vol. 49, no. 4, pp. 633–49. ——— (eds.), 2021, “Symposium ‘Marshall Sahlins’s Stone Age Economics’, a Semi-Centenary Estimate”, Annals of the Fondazione Luigi Einaudi, vol. 55, no. 1, pp. 3–278. Cedrini, M.A., A. Ambrosino, R. Marchionatti & A. Caillé, 2020, “Mauss’s The Gift, or the Necessity of an Institutional Perspective in Economics”, Journal of Institutional Economics, vol. 16, no. 5, pp. 687–701. Charlevoix, P.F.X. de, 1744, Histoire et description générale de la Nouvelle France, Pierre-François Giffart, Paris. Clastres, P., 1974, La Société contre l’État, Editions de Minuit, Paris. Cremaschi, S., 2017, “Adam Smith on Savages”, Revue de Philosophie Économique, vol. 18, no. 1, pp. 13–36. Duchet, M., 1971, Diderot et l’Histoire des Deux Indes ou l’Ecriture fragmentaire, A.G. Nizet, Paris. Ferguson, A., 1767, An Essay on the History of Civil Society, A. Millar & T. Caddel, London, and A. Kincaid & J. Bell, Edinburgh. Harkin, M., 2005, “Adam Smith’s Missing History: Primitives, Progress, and Problems of Genre”, English Literary History, vol. 72, no. 2, pp. 429–51. Hirschman, A.O., 2013, The Passions and the Interests. Political Arguments for Capitalism before Its Triumph [1977], Princeton University Press, Princeton. Jefferson, T., 1784, Notes on the State of Virginia, Stockdale, London. Lafitau, J.-F., 1724, Mœurs des sauvages amériquains comparées aux mœurs des premiers temps, Saugrain et Hochereau, Paris.

324  Roberto Marchionatti ———, 1733, Histoire des découvertes et des conquestes des Portugais dans le Nouveau Monde, Saugrain Père, Jean-Baptiste Coignard Fils, Paris. Marchionatti, R., 2008, Gli economisti e i selvaggi. L’imperialismo della ­scienza economica e i suoi limiti, Bruno Mondadori, Milano. ———, 2012, “The Economists and the Primitive Societies”, The Journal of Socio-Economics, vol. 41, no. 5, pp. 529–40. Marchionatti, R. & M. Cedrini, 2017, Economics as Social Science. Economics Imperialism and the Challenge of Interdisciplinarity, Routledge, London. Marouby, C., 2007, “Adam Smith and the Anthropology of the Enlightenment. The ‘Ethnografic’ Sources of Economic Progress”, in L. Wolff & M. Cipolloni (eds.), The Anthropology of Enlightenment, Stanford University Press, Stanford, pp. 85–102. Mauss, M., 1923–1924, “Essai sur le don. Forme et raison de l’échange dans les sociétés arcaiques”, L’Année Sociologique, seconde série, vol. 1, pp. 30–186. Meek, R.L., 1976, Social Science & the Ignoble Savage, Cambridge University Press, Cambridge. Meek, R.L., D.D. Raphael & P.G. Stein, 1978, “Introduction”, in A. Smith, Lectures on Jurisprudence, ed. R.L. Meek, D.D. Raphael & P.G. Stein, Oxford University Press, The Glasgow Edition of the Works and Correspondence of Adam Smith, Oxford, p. 561. Montesquieu, 1949, The Spirit of the Laws [1748], trans. T. Nugent, with an Introduction by F. Neuman, Hafner Publishing Company, New York. Pauchant, T.C., 2016, “Adam Smith’s Four-Stages Theory of Socio-cultural Theory of Evolution: New Insights from his 1749 Lecture”, The Adam Smith Review, vol. 9, pp. 49–74. Raynal, G.T.F., 1780, Histoire philosophique et politique des établissements et du commerce des Européens dans les Deux Indes, Pellet, Genève, 5 vols. Sahlins, M., 1972, Stone Age Economics, Aldine, Chicago. Sen, A., 2013, “Foreword”, in Hirschman, 2013, pp. IX–XX. Young, A.A., 1928, “Increasing Returns and Economic Progress”, The Economic Journal, vol. 38, no. 152, pp. 527–42.

19 On the nature and causes of trade and the progress of civilization Leonidas Montes

1  Introduction: the Wealth of Nations in context Adam Smith begins An Inquiry into the Nature and Causes of the Wealth of Nations with an “Introduction and Plan of the Work.” As it happens with all great books that surpass the test of history, our author had a clear idea of what he was doing. But, it is also important to remember how he was doing it. The latter helps us in understanding the precision and significance of WN. Indeed, the magnitude of his endeavor, an adventure that enshrined Smith as the father of economics, is worth briefly revisiting. In 1752, Smith was appointed Professor to the prestigious Chair of Moral Philosophy at Glasgow University. According to Smith’s first biography – Dugald Stewart’s Account of the Life and Writings of Adam Smith (EPS: 269–99), published posthumously in 1794 – we know that “[h]is course of lectures on this subject [Moral Philosophy] was divided into four parts” (Life, I.18: 274). They were “Natural Theology,” “Ethics,” “that branch of morality which relates to justice” (or Jurisprudence) and “expediency” (or Political Economy) (EPS, I.18, 20: 274–5). Apparently, Smith did not pay much attention to theology or, better said, gave only the necessary attention to this subject. The language of TMS is rhetorically charged by theology, but WN does not even mention God.1 However, his Lectures on Jurisprudence (academic years 1762–1763 and 1763–1764)2 already show that Smith had quite clear many ideas on political economy before his grand tour to the Continent. Indeed, once the adventure with the young duke of Buccleuch began, he wrote the following to his friend David Hume: The Life which I led at Glasgow was a pleasurable, dissipated life in comparison of that which I lead here at Present. I have begun to write a book in order to pass away the time. (Corr., 82: 102)

DOI: 10.4324/9781003301448-24

326  Leonidas Montes This pastime would become quite an obsession. Once they came back to London after the decease of the brother of the duke of Buccleuch, Smith received a generous pension for life. He retired to his birth town Kirkcaldy with only one target: to work on a treatise about political economy. It took him almost ten years. As he confessed to David Hume: My Business here is Study in which I have been very deeply engaged for about a Month past. My Amusements are long, solitary walks by the Sea side. You may judge how I spend my time. I feel myself, however, extremely happy, comfortable and contented. I never was, perhaps, more so in all my life. (Corr., 103: 125) While David Hume had to deal with the “heteroclite Exploits of Rousseau” (Corr., 111: 133), he also had to cope with Smith’s silence and the unfulfilled promises to see each other. Hume would blame “only a Subterfuges invented by Indolence and Love of Solitude” (Corr., 129: 160). And during this period of intense and isolated work, he even became his executor (see Corr., 137: 168).3 But a month before the publication of WN, David Hume had written to Smith: I am as lazy a Correspondent as you; yet my Anxiety about you makes me write. By all Accounts, your Book has been printed long ago; yet it has never yet been so much as advertised. What is the Reason? If you wait till the Fate of America be decided, you may wait long. By all accounts, you intend to settle with us this Spring: Yet we hear no more of it: What is the Reason? Your Chamber in my House is always unoccupyed: I am always at home: I expect you to land here. I have been, am, and shall be probably in an indifferent State of Health. I weighed myself t’other day, and find I have fallen five compleat Stones. If you delay much longer, I shall probably disappear altogether. (Corr., 149: 185–6) Things were not improving for David Hume. However, he could finally read WN and immediately sent a beautiful letter to his friend Adam Smith: Euge! Belle! Dear Mr Smith: I am much pleas’d with your Performance, and the Perusal of it has taken me from a State of great Anxiety. […] But these and a hundred other Points are fit only to

Nature and causes of trade and the progress of civilization  327 be discussed in Conversation; which, till you tell me the contrary, I shall still flatter myself with soon. I hope it will be soon: For I am in a very bad State of Health and cannot afford a long Delay. (Corr., 150: 186–7) After finally sharing with his friend, Hume passed away. Adam Smith wrote an exquisite and deeply felt letter to his editor, William Strahan, about his friend’s last days. With Smith’s authorization it was published as Life of Hume. Then he wrote to Andreas Holt famously referring to the consequences of this publication: A single, and as, I thought a very harmless Sheet of paper, which I happened to Write concerning the death of our late friend Mr Hume, brought upon me ten times more abuse than the very violent attack I had made upon the whole commercial system of Great Britain. (Corr., 208: 251) He could not understand the reactions of the “zealots” who hated the idea of David Hume dying peacefully. But the memory of Hume was a kind of contagious sympathetic mirror. Indeed, writing about this “very harmless Sheet of paper” he immediately reflected about WN. Adam Smith knew that his “very violent attack” was turning upside down the political economy of his time. He knew that WN was a revolution. But this intellectual revolution was thoroughly thought and well-prepared. The attack “upon the whole commercial system of Great Britain” relied on many years of observation, reflection, and serious work. The precision and careful choice of words in TMS and WN are striking. If Adam Smith was fully aware of what he was doing, it is also important to remember how he was doing it. Although TMS and WN spring from his Lectures at Glasgow, and he kept the unfulfilled promise of a treatise on jurisprudence (see his promise in the “Advertisement” [TMS: 3] and at the final words of TMS), he devoted many years to think about political economy. But he worked without distractions on WN. Although TMS suffered many changes – almost one-third of the definitive sixth edition is additions and corrections – WN, besides the “Additions and Corrections,” only has some minor changes.4 Finally, we have his two books, one on ethics, the other on economics. The question has been whether they are different or complementary. I will argue that since “Introduction and Plan of the Work,” ethics has been an underlying force that allows us to surpass the famous Adam Smith Problem. For that purpose, it is important to uncover the “nature and causes” behind exchange, progress, and civilization.

328  Leonidas Montes

2 Progress and civilization at the outset of the Wealth of Nations We know that throughout WN, Smith’s greatest concern is the poor people, and the main aim of WN is to improve their condition (see, for example, Fleischacker, 2009; McCloskey, 2006). We also know the importance of progress and civilization in WN. 5 Already in the first page of WN, Smith refers to the “savage nations of hunters and fishers” that are “miserably poor.” In the savage nations – the first stage of civilization – they have the necessity sometimes of directly destroying, and sometimes of abandoning their infants, their old people, and those afflicted with lingering diseases, to perish with hunger, or to be devoured by wild beasts. (WN, intro. & plan.4: 10) Yet Smith compares this situation with the final stage of “commercial society”:6 Among civilized and thriving nations, on the contrary, though a great number of people do not labour at all, many of whom consume the produce of ten times, frequently of a hundred times more labour than the greater part of those who work; yet the produce of the whole labour of the society is so great, that all are often abundantly supplied, and a workman, even of the lowest and poorest order, if he is frugal and industrious, may enjoy a greater share of the necessaries and conveniences of life than it is possible for any savage to acquire. (WN, intro. & plan.4: 10) This contrast is evocative and insightful. The father of economics, as an early visionary of modernity, was foreseeing the unintended consequences of progress in society. For that purpose, he compared civilized society with the “savage nations of hunters and fishers” of our ancestors. But the lively and moving image of the kids and elderly abandoned “with lingering diseases, to perish with hunger, or to be devoured by wild beasts” is more than eloquent. Morality is behind this first contrast. The reader even feels a call for sympathy. In sum, since the first page of WN, the road to progress is morally drawn. The first chapter of Book I of WN is “Of the Division of Labour.” Smith analyzes and explains the exponential productive impact of “a very trifling manufacture” (WN, I.i.3: 14). It is the pin factory that he had seen in Kirkcaldy. Indeed, when he refers to this experience, we sense his “wonder and admiration” when he confesses that “I have seen a small manufactory of this kind” (WN, I.i.3: 15). He then argues how

Nature and causes of trade and the progress of civilization  329 “great multiplication of the productions of all the different arts” promotes the “universal opulence which extends itself to the lowest ranks of the people” (WN, I.i.10: 22). But he closes the first chapter of WN comparing, in a very suggestive and provocative Rawlsian manner, the “extremely simple and easy” condition of a poor person with a European prince. The difference is enormous. However, this difference does not always so much exceed that of an industrious and frugal peasant, as the accommodation of the latter exceeds that of many an African king, the absolute master of the lives and liberties of ten thousand naked savages. (WN, I.i.11: 24) Keeping in mind Smith’s repeated emphasis on the “industrious and frugal” character of the poor, his defense of commercial progress also relies on another extreme contrast. And this is another suggestive and evocative example that inclines the reader to rationally sympathize with progress and civilization. Both early comparisons evince Adam Smith’s pragmatism and realism. The contrast between savage society and the age of commerce, and between the European king and the “industrious and frugal peasant” leads to a defense of progress and civilization. It is not a normative call, neither a romantic ideal about the present for the future. Both examples are about facts. And both dissimilarities have a similar aim: progress and civilization. After underlining the importance and purpose of these two contrasts, now we need to uncover the “nature and causes” of progress. Exchange is the key to understand economics.

3 Exchange as the foundation of economics at the outset of the Wealth of Nations The second chapter, in my view the most important one of WN, is entitled “Of the Principle which gives occasion to the Division of Labour.” This brief and rich chapter is the ground for the whole edifice of WN. It is about “the principle” of exchange. We do not know why Smith began WN with Chapter I and the division of labor instead of developing first the crucial and foundational concept of exchange. Perhaps the impressive visual effects of the division of labor might have played a role. As we already underlined, Smith confesses “I have seen a small manufactory of this kind” (WN, I.i.3: 15). Maybe the surprise of seeing this operation might explain why he got so engaged with the pin factory to begin his WN with the chapter on the division of labor, and not with the foundational principle of exchange.7 If so, it would be another example of the triumph of the empirical over the theoretical, or the visible above the abstract.

330  Leonidas Montes Beyond this speculation, the first paragraph is worth fully reproducing, as it refers to the causes and unintended consequences of the division of labor: This division of labour, from which so many advantages are derived, is not originally the effect of any human wisdom, which foresees and intends that general opulence to which it gives occasion. It is the necessary, though very slow and gradual consequence of a certain propensity in human nature which has in view no such extensive utility; the propensity to truck, barter, and exchange one thing for another. (WN, I.ii.1: 25) This passage is fundamental for many reasons. Smith uses “truck, barter, and exchange.” This is not a trivial neither a casual reiteration. Smith was very careful choosing his words. In this case, he is covering all the different institutional arrangements for exchange.8 This comprehensive use of the three kinds of exchange covers truck, that is changing one thing for another, as in a tribe of hunters or shepherds; barter, changing one thing that can be money or a substitute for a service, and finally exchange as simply meaning the modern use of money as a means that facilitates exchange.9 But more importantly, the division of labor and the market are a “gradual consequence” of the principle of exchange. Then Smith, with his common pragmatism and realism, hastily refers about the “nature and causes” of the fundamental propensity to exchange: Whether this propensity be one of those original principles in human nature, of which no further account can be given; or whether, as seems more probable, it be the necessary consequence of the faculties of reason and speech, it belongs not to our present subject to enquire. (WN, I.ii.2: 25) It seems “more probable” to Smith that the general propensity to exchange is the necessary consequence of the “faculties of reason and speech.” Immediately, Smith argues that WN is not the place to inquire about its causes and continues explaining our human propensity to exchange (as it will be argued and developed below, this explanation is very brief, and it seems that Smith is almost taking it for granted). He argues that if language and persuasion are common to all men, these faculties can be found “in no other race of animals” (WN, I.ii.2: 25). And he surprises the reader with this very simple but at the same time deeply insightful argument: Nobody ever saw a dog make a fair and deliberate exchange of one bone for another with another dog. Nobody ever saw one animal

Nature and causes of trade and the progress of civilization  331 by its gestures and natural cries signify to another, this is mine, that yours; I am willing to give this for that. When an animal wants to obtain something either of a man or of another animal, it has no other means of persuasion but to gain the favour of those whose service it requires. A puppy fawns upon its dam, and a spaniel endeavours by a thousand attractions to engage the attention of its master who is at dinner, when it wants to be fed by him. (WN, I.ii.2: 26, italics added) If animals want to obtain something, they need to “gain a favor.” Yet we, human beings, who are social animals (zoon politikon), have language and speech as a “means of persuasion.” Language and speech are necessary for exchanging ideas, that is, for persuading. It could be argued that there is a kind of marketplace for persuasion. And within this market, language and speech are essential for social, moral, and political interaction. But exchange is not any kind of exchange; it has to be “fair and deliberate.” This implies a moral stance that places exchange in the context of persuasion.10 The apparently simple sentence “Nobody ever saw a dog make a fair and deliberate exchange of one bone for another with another dog” hides a moral complexity. Smith uses the word “fair,” a unique Anglo-Saxon concept that has a social and moral sense. Its meaning goes beyond reason and rational deliberation. It appeals to the notion of a fair game, to social rules and not only laws, to what is socially approved but not necessarily enforceable. To behave or act following the morality of fairness also requires mutual sympathy. If the word “sympathy” does not appear in WN, it is present in the moral foundations of exchange, progress, and civilization. Exchange, the first cause for WN, rests upon fairness and persuasion. And both concepts require the social interaction of sympathy. We will soon come back to this crucial point. Then follows the famous and traditionally misinterpreted sentence: “It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from their regard to their own interest” (WN, I.ii.2: 26–7). It is worth noting again that Smith uses another combination of three words: “butcher,” “brewer,” and “baker.” These characters were carefully chosen. It was a representation or an image that during the 18th century made much sense to the poor and common people. The “industrious and frugal peasant” (WN, I.i.11: 24) was quite familiar with meat, beer, and bread. They were “necessaries” for the street porter, not “conveniences” for the philosopher (see below, note 14). Expensive books were luxury goods for Adam Smith, a philosopher “whose trade it is, not to do any thing, but to observe every thing” (WN, I.i.9: 21). This is another proof that the main concern of WN, as we have already pointed out, is the poor. And the main concern is to

332  Leonidas Montes improve their condition. So, the trilogy of butcher, brewer, and baker is also socially and morally charged. Chapter II of Book I of WN continues with the importance of selfinterest. But Smith’s self-interest is different from self-love or selfishness, and it relates to prudence. Regard to our own interest is a realistic account of human nature that has moral foundations and is strongly defended in TMS.

4 The Smith Problem and self-interest Since das Adam Smith Problem was established in the 19th century, many questions about the relationship between TMS and WN have emerged. The Problem was originally put forward by the German Historical School and it is still relevant.11 The historical Adam Smith Problem states that there would be an irreconcilable inconsistency between TMS, with sympathy as the main concept, and WN, founded on self-interest. Today we know that sympathy is a complex idea and that self-interest in not egoistic behavior.12 If it is true that sympathy does not appear in WN, we also know that self-interest is an important motive in both works. In fact, TMS develops a very strong moral defense of self-interest. Prudence is not only a cardinal virtue, but also a crucial Smithian virtue that relates to self-interest. Let me briefly develop this connection to corroborate that self-interest is also very relevant in TMS. Adam Smith shares, mainly with David Hume, a realistic and pragmatic view of human nature. Even if we try to attain moral perfection, we necessarily fall short of perfection. For example, Smith distinguishes between inferior and superior prudence: Wise and judicious conduct, when directed to greater and nobler purposes than the care of the health, the fortune, the rank and reputation of the individual, is frequently and very properly called prudence. […] [S]uperior prudence […] necessarily supposes the utmost perfection of all the intellectual and of all the moral virtues. It is the best head joined to the best heart. It is the most perfect wisdom combined with the most perfect virtue. It constitutes very nearly the character of the Academical or Peripatetic sage, as the inferior prudence does that of the Epicurean. (TMS, VI.i.15: 216) Our eclectic philosopher concentrates on inferior prudence, following the more practical concept of prudence developed by the Epicureans. With an emphasis on “a steady perseverance in the practice of frugality, industry, and application” (TMS, IV.2.8: 189–90), prudence represents a realistic view of this virtue, which is present in TMS and WN. Moreover, Smith restricts prudence to “our own happiness […] originally

Nature and causes of trade and the progress of civilization  333 recommended to us by our selfish […] affections” (TMS, VI.concl.1: 262). His simple and liberal understanding of prudence is worth reproducing: The care of the health, of the fortune, of the rank and reputation of the individual, the objects upon which his comfort and happiness in this life are supposed principally to depend, is considered as the proper business of that virtue which is commonly called Prudence. […] Security, therefore, is the first and the principal object of prudence. (TMS, VI.i.5–6: 213) The virtue of prudence is clearly related to self-interest. It is a self-regarding virtue that fosters Smith’s recurrent defense of the right of all people to pursue the “bettering of our condition” (WN, II.iii.28: 341). The latter does not entail a socially detached individual, neither a Robinson Crusoe separate from society. Prudence demands the approval of the impartial spectator and the supposed impartial spectator within each of us. In short, prudence and self-interest are not the blind pursuit of our wishes, wants, or desires regardless of others. Adam Smith was not a proto utilitarian and, in this point, he diverges from Hume. For example, he knew that riches and money can be problematic. Just remember the story of the poor man’s son who admires the rich and “labours night and day to acquire talents superior to all his competitors” but does not realize that “wealth and greatness are mere trinkets of frivolous utility” that “gratify that love of distinction so natural to man” but bring “no real satisfaction” (TMS, IV.1.8: 181–2). The moral, with an underlying Aristotelian sense of eudaimonia and human flourishing, is obvious: “[p]ower and riches” can lead “to anxiety, to fear, and to sorrow” (TMS, IV.1.8: 182–3).13 Prudence, as a virtue, needs social approval within the sympathetic process. In sum, prudence relates to self-interest and demands sympathy. Smith’s self-interest and sympathy are not incompatible. They both relate to the individual within society. However, it is not enough to argue that self-interest relates to prudence and even to sympathy. Neither is it enough to argue that TMS is about ethics and WN about political economy. The best way to surmount the Smith Problem is by showing that WN transpires morality. A proper understanding of the morality behind progress and trade allows us to reassess the Problem. Under this view, Smith’s political economy would rest upon ethics. Fairness and persuasion are crucial for this argument.

5  The relevance of fairness and persuasion As we have already argued, since the beginning of WN, the division of labor, exchange, and the market have fairness and persuasion as a

334  Leonidas Montes common foundation. Adam Smith was aware of the centrality of persuasion and its dangers as a natural human instinct or desire. He knew that “[t]he desire of being believed, the desire of persuading, of leading and directing other people, seems to be one of the strongest of all our natural desires,” but he also knew that “speech is the great instrument of ambition, of real superiority, of leading and directing the judgments and conduct of other people” (TMS, VII.iv.25: 336). The risks of “leading and directing other people” demand a framework to protect individual liberty against the perils of the human desire to persuade, control, and even dominate other people. In this sense, Smith’s persuasion is also another warning and a call for liberty, tolerance, and human dignity.14 Smith’s purposeful and careful use of “fair and deliberate” is quite important and has not been duly highlighted. The uniqueness of the distinctive Anglo-Saxon word “fair” transpires the morality underlying exchange as the foundation of economics. Anna Wierzbicka has persuasively argued that fair is “thoroughly untranslatable” (2006: 141). She also argues that it usually “co-occurs with right and with reasonable,” other two key English words that reflect the idea of rule of law (2006: 143). Moreover, the meaning of “fair” is always in relation to someone else. We talk about just or unjust laws. But we describe rules as fair or unfair. We obey the former, but morally assess the latter. Laws are enforced; rules are socially recognized. In other words, rules are for those who enter into the social game, but laws are for everybody. Rules are social; laws are impersonal. Wierzbicka points out that fairness implies “a certain consensus”: if we agree to enter into a game, we do things together through voluntary interaction (2006: 146). The player who commits a foul is penalized. The one who, after a foul, gives the ball back to the adversary, is applauded. Therefore, Smith’s use of “fair” exchange is significant. The choice of that precise and unique Anglo-Saxon word has a tremendous ethical implication. Smith adds a moral basis to exchange and economics that connects the market with persuasion, and self-interest with sympathy. Yet this rich and broad tradition of “fair” exchange has been overshadowed in modern neoclassical economics. In my view, the best example that reflects this shift is exemplified by Milton Friedman. In Capitalism and Freedom, he defines exchange as “voluntary and informed” (1962: 13). Although at first glance, Friedman’s definition looks like Smith’s “fair and deliberate,” this apparent similarity deserves more reflection. If “informed” can be understood as the modern interpretation of “deliberate,” “voluntary” lacks the social and moral richness of “fair,” a unique English word that is easier to understand than to translate. In this sense, Friedman’s definition of exchange is related to the individual and contracts, and Smith’s to society and persuasion. In sum, one definition is formal; the other is moral.

Nature and causes of trade and the progress of civilization  335 Although in Chapter II of Book I of WN, Smith too rapidly focuses on the cause of exchange, almost taking for granted the importance of persuasion, in his Lectures on Jurisprudence, he had explained further and more deeply the role of persuasion and its relationship with economics. In other words, he was fully aware of the importance of persuasion as the cause of exchange, trade, progress, and civilization. In LJA, lecture notes from 1762 to 1763, delivered the same academic year as the Lectures on Rhetoric and Belles Lettres, Smith more clearly reflects on the propensity to exchange and its close relationship with persuasion: If we should enquire into the principle in the human mind on which this disposition of trucking is founded, it is clearly the naturall inclination every one has to persuade. The offering of a shilling, which to us appears to have so plain and simple a meaning, is in reality offering an argument to persuade one to do so and so as it is for his interest. Men always endeavour to persuade others to be of their opinion even when the matter is of no consequence to them. If one advances any thing concerning China or the more distant moon which contradicts what you imagine to be true, you immediately try to persuade him to alter his opinion. And in this manner every one is practising oratory on others thro the whole of his life. (LJA, vi.56: 352) Here Smith is more direct and precise: exchange, as a social and moral action that must be “fair and deliberate” (WN, I.ii.2: 26), is “founded” in the “natural inclination every one has to persuade.” Moreover, exchange is an act of communication that appeals to self-interest. In a way, exchange requires persuasion, justice, morality, and rational deliberation. In LJB, lecture notes that correspond to the academic year 1763–1764, we find another very important passage that advances and develops the “nature and causes” of exchange and the crucial distinction between the philosopher and the street porter, the third contrast already discussed (WN, I.ii.4: 28–9). But right after this fundamental distinction that has important political and economic implications, and after explaining the unintended cooperation of the street porter and philosopher due to exchange, Smith insists on the relationship between persuasion and exchange. He argues: The real foundation of [division of labor] is that principle to perswade which so much prevails in human nature. When any arguments are offered to perswade, it is always expected that they should have their proper effect. If a person asserts any thing about the moon, tho’ it should not be true, he will feel a kind of uneasiness

336  Leonidas Montes in being contradicted, and would be very glad that the person he is endeavouring to perswade should be of the same way of thinking with himself. We ought then mainly to cultivate the power of perswasion, and indeed we do so without intending it. Since a whole life is spent in the exercise of it, a ready method of bargaining with each other must undoubtedly be attained. (LJB, 222: 493–4) In this passage from LJB, Smith claims that we ought to “cultivate the power of perswasion.” In society we are constantly exercising this “power,” and we even exercise it “without intending it.” In fact, according to Smith, we spend our “whole life” persuading. The ubiquitous nature of persuasion is like the meaning and sense of Smith’s invisible hand. In other words, the human instinct to persuade is a principle in our nature that spontaneously emerges through social interaction. Even without intending to persuade, we live persuading and being persuaded. Moreover, our self-interest moves us to persuade for exchange based on the “fair and deliberate” moral framework. And if exchange takes place, both self-interested parties’ motivations are satisfied in the act of exchanging. Therefore, we could also talk about an invisible hand of persuasion that attains, without any intentions, the reciprocity of mutual benefit. In sum, persuasion, a fundamental “instinct” or “human principle” for commercial society, could also be seen as another invisible hand within the market of life. Smith closes the above quoted passage arguing that “[s]ince a whole life is spent in the exercise of it,” persuasion is “a ready method of bargaining with each other [that] must undoubtedly be attained” (LJB, 222: 494). From this sentence, it seems that the continuous exercise of persuasion would necessarily lead to a “ready method” of exchange. The relationship between persuasion and the market is clear. Persuasion, for Smith, is just another “trade.” These early passages advance and shed light on the role of persuasion that was briefly mentioned in the beginning of WN. They also give additional evidence that Smith’s concern with the foundational character of persuasion was clear well before he wrote his magnum opus in economics. And this, together with the morality of a “fair” exchange, helps us to reassess the Smith Problem. The famous debate of das Adam Smith Problem, that is, the relationship between TMS and WN, one based on sympathy and the other on self-interest, has been a historical and philosophical issue questioning the consistency of both works, and even the consistency of the author. We know there was no change of mind after Smith’s grand tour to France, as Skaŕzyński first suggested.15 But the concepts of fairness and persuasion as common foundations are necessary and essential for Smith’s project, the project of a “systematic philosopher” (see Schliesser, 2017).

Nature and causes of trade and the progress of civilization  337 What is more, if scholarly attention has been centered on self-interest and sympathy, the concepts of fairness and persuasion are a good argument to dismiss a possible Adam Smith Problem. Smith’s treatment of persuasion reinforces the consistency of his social project. The father of economics had a clear and realistic understanding of human nature, the risks of unbounded persuasion, and the need of sympathy to harness persuasion and protect individual freedom. In sum, Smith’s development of persuasion, from rhetoric to ethics, politics, and economics, underpins his idea of a civilized and free society (see Montes, 2019). And the condition of “fair” exchange reinforces the morality of economics.

6 Conclusions Rhetoric, language, and persuasion are intertwined with ethics and fairness.16 Although in WN Smith argues that persuasion “belongs not to our present subject to enquire” (WN, I.ii.2: 25), its relevance is widespread. Smith’s persuasion is present throughout the legacy of the father of economics, connecting rhetoric with ethics and jurisprudence with political economy. It plays a wide-ranging and central role within Smith’s social system. If Andrew S. Skinner (1976) reminded us that Smith was a “system builder,” persuasion is the foundational and connecting principle for Smith’s understanding of human beings and society. But persuasion is also closely connected to the “propensity to exchange,” that is, to the foundation of economics. And exchange, the ideal of economics as catallaxia, rests upon the moral concept of fairness. At the outset of WN, Smith defends progress and civilization. There are no value judgments. He simply observes a reality that entails moral implications. Adam Smith was certainly a radical for his time. He defended civilization and improvement when a philosopher like Rousseau attacked the corruption of progress and commerce; he was an egalitarian when the distinction of ranks made the difference; he supported basic education when many contemporaries only saw the threat of teaching the poor; he opposed slavery when it was an accepted good business. In sum, even beyond the trilogy of ethics, economics, and jurisprudence, Smith was a moral philosopher in its broad meaning and sense. And WN does not escape from this standpoint. Adam Smith came to be known mainly as the father of economics. But this perception has changed. The renaissance of scholarship on his moral philosophy and TMS is the best proof.17 Besides, recent academic interest on Smith’s essays (EPS) and his rhetoric (LRBL) acknowledges the originality and importance of his multidisciplinary legacy. But Smith’s pervasive, realistic, and comprehensive concern with fairness and persuasion has been rather neglected. Both concepts are key to understand the moral, political, and economic lessons behind Smith’s legacy. But

338  Leonidas Montes more importantly, both concepts allow us to understand the moral foundations behind WN. This is a new way to overcome the unescapable Adam Smith Problem.

Notes 1 Perhaps due to Jacob Viner’s great influence (see especially Viner, 1927), many authors consider Adam Smith as quite religious. However, I tend to believe that he was a “pragmatic agnostic.” It is true that Smith extensively uses religious language in TMS and that even the invisible-hand metaphor could have been inspired by seventeenth and eighteenth religious rhetoric (see Harrison, 2011), but there is also compelling historical evidence for Smith’s agnosticism. Recalling Rasmussen’s wonderful The Infidel and the Professor (2017), we tend to see Hume as the infidel, and Smith as the professor. However, Smith was a public-minded professor. Perhaps he was aware of what had happened to his best friend David Hume who could never get tenured due to his public agnosticism. And just remember what happened when Hume left to Smith in his testament the money to publish his Dialogues concerning Natural Religion. Smith did not do it (it was published in 1779 by Hume’s nephew). I tend to believe that Hume was leaving this burden to his good and prudent friend as a last joke. One could even imagine Hume’s farewell laughter… 2 In 1896, Edwin Cannan found and published Smith’s lecture notes between 1763 and 1764, and then in 1958, John M. Lothian published the lecture notes between 1762 and 1763. Both sets of students’ notes are currently published in Lectures on Jurisprudence as LJB and LJA, respectively. 3 Smith asked Hume to destroy “without any examination” some “eighteen thin folio books” (Corr., 137: 168). The destruction of these papers that supposedly correspond to his promised treatise on jurisprudence, were finally executed by medical scientist Joseph Black and the geologist James Hutton according to Smith’s 1790 will. 4 The “Additions and Corrections” for the first and second edition were published in 1784 and they were included in the third edition. The original supplement has some 24,000 words in seventy nine pages. 5 On the context and relevance of improvement for the progress of commercial society in the Scottish Enlightenment and Adam Smith in particular, see Berry, 2013. 6 Recently Sagar has persuasively argued that we should not speak of “commercial society” as the fourth and final stage. The correct term would be “the age of commerce” (2022: 48). Although “commercial society” appears only two times in Smith’s published legacy, his deeper point is political and historical. 7 See an 18th century pin factory, as it was beautifully illustrated by Denis Diderot, in Liberty Fund, 2018. 8 Already in the beginning of WN, we find combinations of words that are reiterated and have an important meaning and sense. For example, in the “Introduction and Plan of the Work,” “necessaries and conveniences” appear four times, “skill, dexterity, and judgment” three times, and “frugal and industrious” appears in the “Introduction and Plan of the Work” and then at the end in Chapter I. These combinations of words – as it is the case with “truck, barter, and exchange” – are well thought and precise. In fact, the combination of “skill, dexterity, and judgment” is quite analogous to “truck, barter, and exchange,” as it covers the three forms for

Nature and causes of trade and the progress of civilization  339 a comprehensive division of labor (“skill” is general ability, “dexterity” is physical ability, and “judgment” refers to mental ability). 9 Soon after Smith uses twice “by treaty, by barter, and by purchase” (WN, I.ii.2–3: 27) instead of “truck, barter, and exchange.” It is also noteworthy that etymologically barter had a tainted meaning implying a sense of immoral and deceitful exchange. In Johnson’s Dictionary, we can find that “to barter” comes from French barratter: “to trick in traffick” and from barat: “craft, fraud” and the first meaning is “[t]o traffick by exchanging one commodity for another, in opposition to purchasing with money” (Johnson, 1765). But during the 18th century, it also meant “to have sexual intercourse.” 10 Persuading is different from convincing. The latter entails the idea of vincere, of rationally winning an argument. To persuade comes from Latin persuadere “to bring over by talking.” It has an etymologically soft and sweet meaning and sense that calls for sympathy. 11 For an intellectual history of das Adam Smith Problem, see Montes, 2003. 12 Already in 1976, the editors of the Glasgow Edition of TMS, David Raphael and Alec Macfie, declared das Adam Smith Problem as “a pseudo-problem based on ignorance and misunderstanding” (TMS, Intro: 20). As a matter of fact, during the 19th century and most part of the 20th century, sympathy was conflated with benevolence and self-interest with egoism. 13 By challenging the generally accepted influence of Rousseau, Sagar reconsiders the famous poor man’s son passage underlining the “quirk of rationality” (2022: 173–85). In this recent and provocative reassessment, there is a resemblance with Aristotle’s eudaimonia as a process and not an end. 14 The beautiful passage of the street porter and the philosopher (WN, I.ii.4: 28–9) is another very important contrast. In an epoch when aristocracy marked the difference, this passage might have upset the establishment. The contrast between the “street porter” and “the philosopher” is like the comparison between savage society and civilized society in the “Introduction and Plan of the Work,” and the European king and the industrious and frugal peasant in the first chapter. However, in this case, there is a call for equality, tolerance, and human dignity (see Peart & Levy, 2005; 2008) and for Smith’s “liberal plan of equality, liberty and justice” (WN, IV.ix.3: 664). Considering these three contrasts, the very beginning of WN delineates, through comparisons, the road to the progress of a liberal society. And morality is an important part on this adventure. 15 Witold von Skarżyński (1850–1910) published in 1878 Adam Smith als Moralphilosoph und Schöpfer der Nationalökonomie. Ein Beitrag zur Geschichte der Nationalökonomie (Adam Smith as a Moral Philosopher and Creator of National Economy. A Contribution to the History of National Economy). It was a fierce attack on Smith and laissez-faire that argued that Adam Smith had changed his mind after his contact with the French materialists during his grand tour to Europe (Skarżyński, 1878: 183). 16 Griswold (1999) already underlines the importance of rhetoric for Adam Smith and McKenna (2006) establishes important connections with classical rhetoric and more recently Brown (2016) summarizes the general importance of Smith’s LRBL. 17 The essays published in the Adam Smith Review, commemorating the 250th anniversary of TMS, are a good example of this resurgence of interest in Smith’s moral philosophy (for additional scholarship on this direction, see Fleischacker and Brown (2010, pp. 1–11). And on the evolution of this renaissance, see review essays by Recktenwald (1978), Brown (1997), Tribe (1999) and Paganelli (2015).

340  Leonidas Montes

References Berry, C.J., 2013, The Idea of Commercial Society in the Scottish Enlightenment, Edinburgh University Press, Edinburgh. Brown, V., 1997, “Mere Inventions of the Imagination”, Economics and Philosophy, vol. 13, no. 2, pp. 281–312. ———, 2016, “The Lectures on Rhetoric and Belles Lettres”, in R.P. Hanley (ed.), Adam Smith: His Life, Thought, and Legacy, Princeton University Press, Princeton, NJ – Oxford, pp. 17–32. Fleischacker, S., 2009, On Adam Smith’s Wealth of Nations: A Philosophical Companion, Princeton University Press, Princeton, NJ. Fleischacker, S. & V. Brown, 2010, “The Philosophy of Adam Smith. Essays Commemorating the 250th Anniversary of The Theory of Moral Sentiments”, The Adam Smith Review, vol. 5, pp. 1–11. Friedman, M., 1962, Capitalism and Freedom, University of Chicago Press, Chicago. Griswold, C.L., 1999, Adam Smith and the Virtues of Enlightenment, Cambridge University Press, Cambridge. Harrison, P., 2011, “Adam Smith and the History of the Invisible Hand”, Journal of the History of Ideas, vol. 72, no. 1, pp. 29–49. Johnson, S., 1765, Dictionary of the English Language [1755], 3rd ed., Strahan, London, 2 vols. Liberty Fund, 2018, The Pin Factory (viewed 15 August 2022, ) McCloskey, D.N., 2006, The Bourgeois Virtues, Chicago University Press, Chicago. McKenna, S.J., 2006, Adam Smith: The Rhetoric of Propriety, State University of New York Press, Albany, NY. Montes, L., 2003, “Das Adam Smith Problem: Its Origins, the Stages of the Current Debate, and One Implication for Our Understanding of Sympathy”, Journal of the History of Economic Thought, vol. 25, no. 1, pp. 64–90. ———, 2019, “Adam Smith’s Foundational Idea of Sympathetic Persuasion”, Cambridge Journal of Economics, vol. 43, no. 1, pp. 1–15. Paganelli, M.P., 2015, “Recent Engagements with Adam Smith and the Scottish Enlightenment”, History of Political Economy, vol. 47, no. 3, pp. 363–94. Peart, S. & D.M. Levy, 2005, The “Vanity of the Philosopher”: From Equality to Hierarchy in Post-classical Economics, University of Michigan Press, Ann Arbor, MI. ———, 2008, The Street Porter and the Philosopher: Conversations on Analytical Egalitarianism, University of Michigan Press, Ann Arbor, MI. Rasmussen, D.C., 2017, The Infidel and the Professor: David Hume, Adam Smith, and the Friendship that Shaped Modern Thought, Princeton University Press, Princeton, NJ. Recktenwald, H.C., 1978, “An Adam Smith Renaissance Anno 1976? The Bicentenary Output – A Reappraisal of His Scholarship”, Journal of Economic Literature, vol. 16, no. 1, pp. 56–83. Sagar, P., 2022, Adam Smith Reconsidered: History, Liberty, and the Foundations of Modern Politics, Princeton University Press, Princeton, NJ.

Nature and causes of trade and the progress of civilization  341 Schliesser, E., 2017, Adam Smith. Systematic Philosopher and Public Thinker, Oxford University Press, Oxford. Skarżyński, W., 1878, Adam Smith als Moralphilosoph und Schöpfer der Nationaloekonomie. Ein Beitrag zur Geschichte der Nationaloekonomie, Theobald Grieben, Berlin. Skinner, A.S., 1976, “Adam Smith: The Development of a System”, Scottish Journal of Political Economy, vol. 23, no. 2, pp. 111–32. ———, 1979, A System of Social Science Papers Relating to Adam Smith, Clarendon Press, Oxford. Tribe, K., 1999, “Adam Smith: Critical Theorist?”, Journal of Economic Literature, vol. 37, no. 2, pp. 609–32. Viner, J., 1927, “Adam Smith and Laissez Faire”, Journal of Political Economy, vol. 35, no. 2, pp. 198–232. Wierzbicka, A., 2006, English: Meaning and Culture, Oxford University Press, Oxford.

Index of passages quoted

AL, 1 AP, 1 AP, 2

198 198 126

Corr., 40 Corr., 82: 102 Corr., 103 Corr., 111: 133 Corr., 129: 160 Corr., 132: 164 Corr., 137 Corr., 149 Corr., 150 Corr., 154: 193 Corr., 154: 194 Corr., 208: 251 Corr., 276: 311

142 325 326 326 326 264 326, 338 326 326–7 283 299–300 278, 327 176–7

ED, 1 ED, 4 ED, 4–5: 563 ED, 5: 564 ED, 6 ED, 10 ED, 11 ED, 12 ED, 13: 567 ED, 19 ED, 22

313 313 251 253, 274 274, 298, 313 251, 314 252 250, 259 314 125 295

HA, I.2–6 HA, I-II HA, II.2–3: 38–9 HA, II.3 HA, II.3: 38 HA, II.12: 45 HA, II.12: 45–6 HA, II.12: 46 HA, III.2: 49–50 HA, III.3: 50

19 208 198 20 20 272 21 126 4 23

HA, IV.13   HA, IV.13: 61   HA, IV.13: 61–2   HA, IV.13: 62   HA, IV.19: 66   HA, IV.76: 104   HA, IV.76: 105  

283 112–13 113 125 27,125, 271–2 37, 112 112

IA, II.1  

308

Letter, 12   308 Life, I.18   Life, II.1   Life, II.45–46   Life, II.47–48   Life, II.48   Life, III.11   Life, III.15: 306   Life, IV.13   Life, V.8  

325 209 322 191 271, 311 44 37 148 177

LJA, i.1   LJA, i.27   LJA, i.27–28: 14   LJA, i.27–32   LJA, i.28: 15   LJA, i.33–34   LJA, i.35: 16   LJA, i.35–44   LJA, i.48   LJA, i.86   LJA, i.119   LJA, iii.78–79   LJA, iii.101   LJA, iii.102   LJA, iii.105: 182   LJA, iii.106   LJA, iii.108–9: 184  LJA, iii.110: 185  

242, 271 271, 278, 312 247 312–13 247 247 238 191 247 247 262 242–3 276 276–7 277 277 277 277

344  Index of passages quoted LJA, iii.114   276 LJA, iii.115: 187    276 LJA, iii.115–6: 187   276 LJA, iii.126: 191    277 LJA, iii.130    276 LJA, v.110–111: 314  238 LJA, v.115    4 LJA, v.119–21: 318   235–6 LJA, vi.25    235 LJA, vi.26, 28    274 LJA, vi.27    234 LJA, vi.44–46    232 LJA, vi.46    184, 247 LJA, vi.46–49    295 LJA, vi.47–8: 348    281 LJA, vi.49    295 LJA, vi.56    232, 317, 335 LJA, vi.56–57: 352    260 LJA, vi.79–80    251 LJA, vi.83    240 LJA, vi.84    241 LJA, vi.97: 366    241 LJA, vi.109    244 LJB, 1    LJB, 12–15    LJB, 134    LJB, 134: 452    LJB, 136    LJB, 137    LJB, 137: 452    LJB, 149    LJB, 212–213    LJB, 218    LJB, 220    LJB, 221    LJB, 221–222    LJB, 222    LJB, 222: 494    LJB, 225    LJB, 227    LJB, 229–30    LJB, 264    LJB, 326    LJB, 327: 538    LJB, 328–333   

271 205 276 276 277 277 277 271 274 203 203, 209, 281 203 317 335–6 336 126 252 263 299 301 301 275

LRBL, i.v.34    125 LRBL, i.v.67    72, 86 LRBL, i.112–113: 45  75 LRBL, i.v.116   75 LRBL, i.117: 48    74 LRBL, i.122–123: 50  74 LRBL, i.125: 51    74 LRBL, i.145: 59    71 LRBL, i.146: 59    72

LRBL, i.147: 60    LRBL, i.148: 60    LRBL, i.148: 60–1   LRBL, ii.18    LRBL, ii.63–64: 112  LRBL, ii.64: 112    LRBL, ii.90: 124    LRBL, ii.91: 124    LRBL, ii.133    LRBL, ii.133: 146    LRBL, ii.134    LRBL, ii.152: 154   

72 73 72 272 86 81, 82 76 76–7 37 37 272 71

Review, 13    73 TMS: 3   327 TMS, I.i.1.1   24, 139, 140, 199 TMS, I.i.1.2   101–3, 106, 109, 111–12, 117 TMS, I.i.1.3    102, 109, 116 TMS, I.i.1.5    103, 140 TMS, I.i.1.6    102, 103 TMS, I.i.1.9    103 TMS, I.i.1.9: 11    103 TMS, I.i.1.10    103 TMS, I.i.1.12    103 TMS, I.i.1.13: 12    103, 116 TMS, I.i.2    226 TMS, I.i.2.1: 13    155, 200 TMS, I. i.3.1: 16    187 TMS, I.i.3.1–2    129 TMS, I.i.3.4    126 TMS, I.i.3.5    130 TMS, I.i.3.6    201 TMS, I.i.3.10    140 TMS, I.i.4.2    141 TMS, I.i.4.3: 20    120–1, 121 TMS, I.i.4.6–10    126 TMS, I.i.4.7    134 TMS, I.i.4.7: 22    155 TMS, I.i.4.9: 23    301 TMS, I.i.4.10    228 TMS, I.i.5.1    56 TMS, I.i.5.3    59 TMS, I.i.5.4    59 TMS, I.i.5.5    62 TMS, I.i.5.8    156 TMS, I.ii.intro.1    156 TMS, I.ii.1.1: 27    102 TMS, I.ii.1.5    102 TMS, I.ii.1.7    83 TMS, I.ii.1.10    107 TMS, I.ii.1.11    83 TMS, I.ii.1.12    54

Index of passages quoted  345 TMS, I.ii.2    82 TMS, I.ii.2.1: 31    82 TMS, I.ii.2.2    83, 228 TMS, I.ii.2.3: 33    83 TMS, I.ii.3.7    137 TMS, I.ii.3.7: 37    228 TMS, I.ii.4.1    130 TMS, I.ii.4.1–2    140 TMS, I.ii.5.1    137 TMS, I.ii.5.3: 42    73 TMS, I.ii.5.3: 43    74 TMS, I.ii.5.4    74 TMS, I.iii.1    127 TMS, I.iii.1.7    228 TMS, I.iii.1.13: 48   63 TMS, I.iii.2    78 TMS, I.iii.2.1: 50    157, 203 TMS, I.iii.2.1: 51    130, 298 TMS, I.iii.2.2: 52    78, 84 TMS, I.iii.2.4: 53    78 TMS, I.iii.2.5    139 TMS, I.iii.2.5: 55    78 TMS, I.iii.2–3    78 TMS, I.iii.3.1: 61    140 TMS, I.iii.3.2    136 TMS, I.iii.3.5    139 TMS, I.iii.3.7    136 TMS, I.iii.3.8: 65    79 TMS, II.i.1.2    186 TMS, II.i.1.4    166 TMS, II.i.2.4    186 TMS, II.i.2.5: 71    104, 156 TMS, II.i.3.2    186 TMS, II.i.3.3    129 TMS, II.i.5.7    187 TMS, II.ii.1.4    187 TMS, II.ii.1.5: 79    219 TMS, II.ii.1.8    246 TMS, II.ii.1.9: 82    219 TMS, II.ii.1.10    164 TMS, II.ii.2.1: 82    201, 220 TMS, II.ii.2.1: 83   126, 147, 167, 221, 226–7 TMS, II.ii.2.2    155 TMS, II.ii.2.2: 84   168, 213, 219, 228 TMS, II.ii.2.3: 84    156 TMS, II.ii.3    219 TMS, II.ii.3.1    155, 167 TMS, II.ii.3.2    205 TMS, II.ii.3.3    188, 202 TMS, II.ii.3.4   156, 219, 241–2 TMS, II.ii.3.5    28 TMS, II.ii.3.6: 87    242 TMS, II.ii.3.10: 89   166–7 TMS, II.iii.1.6    201

TMS, II.iii.3.3    29 TMS, III: 109    57 TMS, III.1.3: 110    132 TMS, III.1.5    132 TMS, III.1.7    228 TMS, III.2.1    130 TMS, III.2.1: 113    121, 150 TMS, III.2.3    136, 228 TMS, III.2.5: 116    122 TMS, III.2.7    122 TMS, III.2.9    129, 136 TMS, III.2.11    131 TMS, III.2.31    131, 133 TMS, III.2.33:    132 282 TMS, III.2.34: 133   282 TMS, III.3    217 TMS, III.3.2–4    155 TMS, III.3.4    132 TMS, III.3.4: 137    156–7 TMS, III.3.7: 139    129, 155 TMS, III.3.8    54 TMS, III.3.11    63 TMS, III.3.13    64, 135 TMS, III.3.14: 143   64 TMS, III.3.15    218 TMS, III.3.18    80 TMS, III.3.21    61, 133–4 TMS, III.3.21–22    133 TMS, III.3.22   61, 131, 135–6, 149 TMS, III.3.25    63, 302 TMS, III.3.25: 146   61–2 TMS, III.3.26    57 TMS, III.3.27    218 TMS, III.3.27: 147   57 TMS, III.3.28    57, 135 TMS, III.3.30    217–18, 228 TMS, III.3.30–31    137 TMS, III.3.31    218, 228 TMS, III.3.31: 149   218 TMS, III.3.31: 150   218 TMS, III.3.34    62 TMS, III.3.35    62 TMS, III.3.36    141 TMS, III.3.36: 152   62 TMS, III.3.36: 153   141 TMS, III.3.37    149, 150 TMS, III.3.43: 155   170 TMS, III.3.43: 156   170 TMS, III.4.4   141 TMS, III.4.4: 158    170 TMS, III.4.6: 158    155 TMS, III.4.7    170 TMS, III.4.12    141 TMS, III.4.12: 160   58 TMS, III.4.12: 161   58

346  Index of passages quoted TMS, III.5.1 138 TMS, III.5.1: 162 78 TMS, III.5.2 155 TMS, III.5.7 137, 298 TMS, III.5.9 130 282 TMS, III.5.11 TMS, III.6.9 188, 302 TMS, III.6.9–10 300 TMS, III.6.11: 175 156 214 TMS, IV.1.3: 179 TSM, IV.1.4 18 26, 215 TMS, IV.1.5 TMS, IV.1.6 215 TMS, IV.1.7 215 TMS, IV.1.8: 181 214–16, 221–2, 225 TMS, IV.I.8: 181–2 333 TMS, IV.1.8: 182 216 217 TMS, IV.1.8: 182–3 TMS, IV.1.8: 183 217 217 TMS, IV.1.9 206–7, TMS, IV.1.9–10: 183 207 TMS, IV.1.10: 183 157, 219, 226 TMS, IV.1.10: 184 158, 225, 226 TMS, IV.1.10: 184–5 163 TMS, IV.1.10: 185 80, 226, 228 TSM, IV.1.11: 185 18, 30, 80, 178, 205 TSM, IV.1.11: 185–6 32 TMS, IV.2.1 154, 279 TMS, IV.2.3 205 TMS, IV.2.6 52 TMS, IV.2.8 54, 131, 133, 332 TMS, IV.2.8: 189 52–3 TMS, IV.2.10 150 TMS, V.2.5 139 TMS, V.2.8 309 TMS, V.2.8: 205 51, 298 TMS, V.2.9: 205 149, 298, 309 TMS, V.2.9: 206 276 TMS, V.2.9–10 276 150, 309 TMS, V.2.10: 207 TMS, V.2.15: 210 149 TMS, VI.i.3 206 TMS, VI.i.3: 213 155 TMS, VI.i.5–6 333 TMS, VI.i.11 53, 56 TMS, VI.i.12 55 TMS, VI.i.13: 215 302 TMS, VI.i.13: 216 55

TMS, VI.i.15 332 80 TMS, VI.i.16: 217 TMS, VI.ii.intro.2 156 TMS, VI.ii.1.1 165 TMS, VI.ii.1.10 129, 138, 140, 141 TMS, VI.ii.1.12–13 297 TMS, VI.ii.1.13 297 TMS, VI.ii.1.17 29–30, 133, 134 TMS, VI.ii.1.18 138, 140 TMS, VI.ii.1.19 131 264 TMS, VI.ii.1.20: 226 TMS, VI.ii.2.11 302 TMS, VI.ii.2.17 29–30 33 TMS, VI.ii.3.5: 236 TMS, VI.iii.1 58 51, 149 TMS, VI.iii.11 TMS, VI.iii.13 55 TMS, VI.iii.15 150 60 TMS, VI.iii.18: 245 TMS, VI.iii.23 141 79 TMS, VI.iii.28: 250 TMS, VI.iii.30: 252 79 TMS, VI.iii.30: 253 79 79 TMS, VI.iii.33 TMS, VI.iii.46 130 136 TMS, VI.iii.50 TMS, VI.iii.53 136 TMS, VI.concl.1 332–3 53–4 TMS, VI.concl.2 TMS, VII.ii.1.10: 269 242 228 TMS, VII.ii.1.10: 270 136–7 TMS, VII.ii.1.24: 279 TMS, VII.ii.1.46 64 TMS, VII.ii.1.47 130 TMS, VII.ii.3.6 131 TMS, VII.ii.3.13 136 TMS, VII.ii.3.15 134 TMS, VII.ii.4.2 64 TMS, VII.ii.4.8 131 TMS, VII.ii.4.9 130 TMS, VII.ii.4.10 131 TMS, VII.iii.3.7 86 TMS, VII.iii.10.4 106 TMS, VII.iv.24–25 260 TMS, VII.iv.25 334 TMS, VII.iv.28 135 TMS, VII.iv.33: 339 85 TMS, VII.iv.37: 341 253 TMS, VII.iv.37: 342 254 WN, intro. & plan.4 149, 255, 307, 328 WN, intro. & plan.7 272 WN, intro. & plan.9: 11 264

Index of passages quoted  347 WN, I.i 150 WN, I.i.1 259–60, 274 WN, I.i.3: 14 328 WN, I.i.3: 15 328, 329 WN, I.i.8: 20 113–14, 116 WN, I.i.8: 20–1 110 WN, I.i.9: 21 114, 177–8, 331 WN, I.i.10 157–8, 218, 295, 329 WN, I.i.11 224, 331 WN, I.i.11: 24 329 WN, I.ii.1 157, 178, 294, 316, 330 WN, I.ii.1–3 295, 298 WN, I.ii.2: 25 119, 264, 316, 330, 337 WN, I.ii.2: 26 117–18, 153, 188, 204, 330–1, 335 WN, I.ii.2: 26–7 187, 233–4, 297–8, 331 WN, I.ii.2–3: 26–7 316–17 WN, I.ii.2–3: 27 339 318 WN, I.ii.3 WN, I.ii.3: 27 183 WN, I.ii.4 281, 335, 339 WN, I.ii.4: 28 183 WN, I.ii.5: 30 295 WN, I.iii 119 WN, I.iii.1 119, 120, 315 WN, I.iii.2: 31 119–20, 151 WN, I.iii.4 120 WN, I.iii.8: 36 320 WN, I.iv.1 314–15 WN, I.iv.2 118 WN, I.iv.4: 38 118 190 WN, I.iv.12 WN, I.iv.14 180, 190 WN, I.v.7: 50 263 WN, I.vi.1 179–80, 306, 320 WN, I.vi.4 190 WN, I.vii.1–7 253 WN, I.viii.1–2 252 WN, I.viii.2 320

WN, I.viii.5: 82 252 274 WN, I.viii.8 WN, I.viii.10 254 WN, I.viii.13 253 WN, I.viii.13: 84 278 WN, I.viii.23 153 306 WN, I.viii.23: 88 WN, I.viii.24: 89 151 149, 151 WN, I.viii.24: 90 WN, I.viii.26: 91 151 254 WN, I.viii.28–35 WN, I.viii.36 263, 274, 298 WN, I.viii.37: 96 149 WN, I.viii.44 152 263 WN, I.viii.44: 100 WN, I.viii.45–47 265 252 WN, I.viii.48: 101 WN, I.viii.57 260 WN, I.ix.15: 112 151 278 WN, I.ix.24 WN, I.ix.24: 115 278 152 WN, I.x.c.12 WN, I.x.c.16 126 WN, I.x.c.22: 142 297 278 WN, I.x.c.25 WN, I.x.c.26: 145 273 280 WN, I.x.c.27 WN, I.x.c.61: 158 264 WN, I.xi.a: 160 320 244 WN, I.xi.b.5 WN, I.xi.b.27: 170 119 307 WN, I.xi.c.6 299 WN, I.xi.g.6 WN, I.xi.n.1: 255 254, 262 299 WN, I.xi.n.1: 256 WN, I.xi.p.10 278–9 WN, I.xi.p.10: 267 243 WN, II.intro.3 187 WN, II.ii.94 280 WN, II.iii.19–20 255 WN, II.iii.28 130 WN, II.iii.28: 341 157, 333 WN, III.i: 376 273 WN, III.i.5 262 WN, III.i.9 271, 272, 273 WN, III.ii.1 273 WN, III.ii.4: 384 152 WN, III.ii.7–8 152 WN, III.ii.9: 387 152 WN, III.ii.10: 388 265, 276, 277 WN, III.ii.10: 389 152 WN, III.ii.20 262 WN, III.iii.5 255, 261

348  Index of passages quoted WN, III.iv.4 153, 223, 261, 274, 298, 299 WN, III.iv.5 297 WN, III.iv.6: 414 262 55, 297 WN, III.iv.10 WN, III.iv.11 153 WN, III.iv.11: 420 223 WN, III.iv.11–18 297 WN, III.iv.12 223, 262, 297 WN, III.iv.13 255 WN, III.iv.17: 422 85 WN, III.iv.19 153 261 WN, III.iv.20: 425 WN, III.iv.24: 426 279 35 WN, IV.intro WN, IV.intro.1 36, 315 WN, IV.intro.2 24, 44, 278 WN, IV.i 39 38 WN, IV.i.1 WN, IV.i.10: 434 279 WN, IV.i.15 39 40 WN, IV.i.34: 450 WN, IV.i.35 39 39 WN, IV.ii.3–14 WN, IV.ii.4 315 WN, IV.ii.9: 456 6, 13, 39, 241, 315 WN, IV.ii.21: 462 279 280 WN, IV.ii.43 WN, IV.ii-vi 39 WN, IV.iii.b 35 WN, IV.iii.c.9 184, 279, 280 WN, IV.iii.c.10: 493 279 WN, IV.iii.c.10: 494 278 WN, IV.iii.c.13 279 WN, IV.v.a.16–19 39 WN, IV.v.b 35 WN, IV.v.b.43 148, 299 WN, IV.vii 35 WN, IV.vii.b.44 247 WN, IV.vii.b.51 153 WN, IV.vii.b.54: 586 277 WN, IV.vii.b.55 277 278 WN, IV.vii.c.43: 604 WN, IV.vii.c.44 261, 278 WN, IV.vii.c.50 277 WN, IV.vii.c.55 277 WN, IV.vii.c.61: 612 280 WN, IV.vii.c.63: 613 278 WN, IV.vii.c.89 278 WN, IV.vii.c.102–106 151 WN, IV.vii.c.103: 637 279 WN, IV.viii.1 39

WN, IV.viii.30 148 40, 278 WN, IV.viii.54: 661 WN, IV.ix 42 WN, IV.ix.1 46 WN, IV.ix.2 42 WN, IV.ix.3: 664 316, 339 WN, IV.ix.15 42 WN, IV.ix.17: 669 261 42–3 WN, IV.ix.24 WN, IV.ix.27: 672 43 273 WN, IV.ix.28: 674 WN, IV.ix.29 43 43 WN, IV.ix.29–37 WN, IV.ix.30: 675 43 WN, IV.ix.31 44 38, 43, 44 WN, IV.ix.38: 678 WN, IV.ix.38: 679 43 46 WN, IV.ix.40–47 WN, IV.ix.51 213, 301 WN, IV.ix.51: 687 41, 44, 45, 239, 242, 278, 316 WN, IV.ix.51: 688 242 WN, V.i.a.2: 690 320 WN, V.i.a.14 289, 299 WN, V.i.a.40 299, 301 WN, V.i.a.41: 707 299, 300 WN, V.i.a.42 298–9 WN, V.i.a.44 299 WN, V.i.b.2: 709 263, 320 WN, V.i.b.2: 710 321 WN, V.i.b.3–11 258 320 WN, V.i.b.6 320–1 WN, V.i.b.7: 712 WN, V.i.b.20: 719 227 WN, V.i.d.1–2 227 WN, V.i.d.18: 730 227 WN, V.i.d-e 213 WN, V.i.e.26: 752 279–80 WN, V.i.f.1: 758 227 WN, V.i.f.16 227 WN, V.i.f.25 37, 178–9 WN, V.i.f.50 281 WN, V.i.f.50: 782 27, 275–6 WN, V.i.f.51: 782–3 275 WN, V.i.f.51: 783 275, 296 WN, V.i.f.51: 784 275 WN, V.i.f. 54 275 WN, V.i.f.55: 785 275 WN, V.i.f.60 275 WN, V.i.f.61 275 WN, V.i.f-g 128 WN, V.i.f-i 213 WN, V.i.g.19: 799 281 WN, V.ii.k.7 255 WN, V.iii.68 178 WN, V.iii.89 258

Index

Adam Smith Problem 32, 196–7, 231, 327, 332, 336–9 Addison, Joseph 96–7, 107; The Spectator 96–7, 169 Aeschylus 166 Albaum, Martin 208, 209 Alexander the Great 79–80 Alexy, Robert 233, 248 alienation 207, 292; and division of labour 292; of workers 259, 282 Alvey, James Edward 283, 284 Ambrosino, Angela 319, 323 Anderson, Elizabeth 221, 228 Anheier, Helmut Klaus 304 anthropology 307, 310–11, 318–20 Apollonius of Perga 112–13, 116, 125 Aristotle 36, 70, 76, 92, 107, 140, 141, 339; De Anima 92; Nicomachean Ethics 70 artificial intelligence 172–4 Aspromourgos, Tony 228, 264, 265, 271, 284 Atkins, Margaret 142 Ava 173 Aveling, Edward 286 Axelrod, Robert 164, 174 Backhouse, Roger E. 46 Bacon, Francis 93, 105, 107; The New Organon 93, 105 Bagehot, Walter 283, 284 Balletti Riccoboni, Elena Virginia 81 Barnes, Harry Elmer 289, 303 Barrington, Russell 284 Barry, Norman 3, 15 Bassiry, George R. 217, 227, 228 Beauchamp, Tom Lamar 265 beauty 18, 22, 29, 37, 80, 121, 132, 141, 205–7

beavers and deer 176, 179–84, 189–91 Bee, Michele 66, 67, 139, 142, 149, 150, 159, 322, 323 behaviour 9, 37, 59–60, 90, 103, 122, 132, 168, 170, 177, 193–5, 197, 203, 206, 208, 249–51, 256, 302; economic 163, 194, 289; moral 171, 194–5 beneficence 8, 187–8, 191, 219, 228 benevolence 9, 58, 131, 153, 186–8, 191, 195, 205, 231, 233, 242, 297–8, 316–17, 331, 339 Bentham, Jeremy 209 Berry, Christopher J. 3, 15, 16, 128, 142, 143, 160, 228, 230, 265, 283, 284, 287, 288, 302, 303, 338, 340 bettering our condition 113, 115, 203, 256, 258, 263, 333; desire of 256 Beugnot, Bernard 87 Bevan, David 228 Bishop, John Douglas 281, 284 Biziou, Michaël 20, 34 Black, Joseph 338 Blaug, Mark 37, 38, 46, 128, 142, 180, 191 Blecker, Robert A. 284 Blosser, Joe 272, 283, 284 Bonar, James 321, 323 Bougainville, Louis-Antoine de 307 Bouhours, Dominique 72 bourgeois manners 68 bourgeois society 162, 170–1 bourgeois virtues 55, 65 Bourguinat, Élisabeth 81, 82, 86 Bowles, Paul 284 Brennan, Jason 65, 67 Brewer, Anthony 284 Brown, Vivienne 127, 128, 139, 142, 259, 264, 265, 290, 303, 339, 340 Buccleuch see Scott, Henry

350 Index Buchanan, James McGill 14, 15, 154, 157, 159, 316, 323 Bullard, Paddy 87 Bury, Emmanuel 72, 73, 86 Bury, John Bagnell 285 Bush, Judith R. 287 butcher, brewer, and baker 153, 187, 232–3, 298, 317, 331–2 Cadell, Thomas 176 Caesar, Caius Iulius 79 Cairns, John 128, 142 Caleb 173 Cannan, Edwin 338 Cantillon, Richard 40–1, 264 capital 6, 42, 162, 164, 176, 292, 315–16; accumulation of 151, 162, 169, 272 capitalism 217–18, 243, 245–6, 281, 283, 319, 322 capitalist civilization 290 capitalist society 162, 233, 280, 290 Carey, Toni Vogel 3, 15 Carlisle, Clare 108 Carrasco, María Alejandra 10, 15, 64, 65, 66, 67, 128, 142 Carroll, Ross 71, 73, 75, 76, 85, 86 Cato, Marcus Porcius 63 Cedrini, Mario Aldo 283, 286, 307, 308, 309, 319, 321, 323–4 character 68–9, 71–2, 74, 76–7, 79, 81–2, 99, 106, 132, 136–8, 139, 141, 154, 193, 196–7, 199–201, 205–6, 208, 209, 249 Charlesworth, Andrew 266 Charlevoix, Pierre François Xavier de 307–8, 320, 321, 323 choice 65, 194, 203 Chrysippus 164 Cicero, Marcus Tullius 70, 141, 142 Cineas 218 Cipolloni, Marco 324 civil government 154, 271–2, 320, 321 civilisation 275–6, 318, 327, 328; progress and/of 328–9, 331, 335, 337 civilized man 318 civilized nations 85, 254, 299, 306, 309, 328 civilized society 85, 204, 274–5, 277, 296, 298, 301, 306, 309–11, 313–16, 320–3, 328, 337, 339

civilized/uncivilzed behaviour 84–5, 141 civil society 161, 280, 290–1, 293, 307 Clarke, Peter H. 303 classification 19–21, 198, 283 Clastres, Pierre 321, 323 Coats, Alfred William Bob 283, 284 Cockfield, Geoff 142 coercion 241–2, 260, 280 Colbert, Jean-Baptiste 42 Coleman, Patrick 287 Collini, Stefan 287 Collins, Anthony 69, 86 colonial commerce 151, 277–8 colonialism 277 colonial policies 152–3, 261–2 colonial slavery 277 Columella, Lucius Junius Moderatus 119 commerce: age of 236, 276, 290, 312– 13, 318, 322, 329, 338; colonial 151, 277–8; international, foreign 272, 296; moral effects of 150–1, 184, 274, 299, 301; open and free 279; political effects of 223, 261, 274, 299; system of 36, 278 commercial civilisation 322 commercial society 12, 23–4, 52, 68, 80, 118, 129, 150, 151–3, 156, 158, 161, 167, 186, 213, 218, 222–6, 233–6, 245, 250–1, 255, 257, 275, 277–8, 280–1, 289–92, 314–15, 317–19, 328, 336, 338; see also market society commercial system 38–42, 327; see also mercantilism, mercantile system commercial virtues 169–71, 197 common consent 178, 181, 185 community 66, 132, 134, 161–2, 164, 166, 170–1, 283, 292–3, 313; moral 84, 120, 124 complexity 31, 37, 231, 237–9, 241, 331 Comte, Auguste 208 Condillac, Étienne Bonnot de 31, 34, 106; Essay on the Origin of Human Knowledge 106 Condren, Conal 69, 70, 77, 86 conjectural history 183, 185, 189, 191, 270–1, 311, 323 conjectural method 318–19

Index  351 conscience 128–39, 200, 206, 217, 221 consumption 39, 53, 119, 207, 234, 314–15, 318 contentment 136, 218 Cook, James 307 cooperation 120, 155, 164, 231, 236, 238, 316; unintended 335 Copernicus, Nicolaus 208 Corrigan, Philip Richard D. 290, 303 corruption 78, 84, 140, 281, 284, 291 Coser, Lewis 303 Cottingham, John 107 Craven, Paul 265 Crébillon, Claude-Prosper Jolyot de 81–2, 86 Cremaschi, Sergio 283, 284, 309, 323 Crisp, Roger 229 critic, Smith as 43–4, 68–9, 71, 75, 85, 280–3, 311 d’Ablancourt see Perrot d’Ablancourt, Nicolas Dagen, Jean 86 Daire, Eugène 34 d’Alembert, Jean le Rond 34 Darlymple, John 270 Darwall, Stephen 90, 107, 156, 159 Darwin, Charles Robert 89 da Vinci see Leonardo da Vinci Davis, Gordon F. 65, 67 Davis, John 246, 248 Davis, John Brian 11, 15 Debes, Remy 65, 66, 67 deception 83, 206–7, 219–23, 225 deer and beavers 176, 179–84, 189–91 Della Porta, Giovanni Battista 105 Dellemotte, Jean 274, 285 Den Uyl, Douglas J. 82, 87 Denis, Andy 14, 15, 282, 283, 285 Descartes, René 93, 94, 103, 105, 107; The Passions of the Soul 93, 105 descriptive/normative 31, 36, 38, 237–8, 240, 253–4, 256, 261, 263, 271–2 Destrée, Pierre 87 determinism 270 development: economic 41, 42, 162; historical 241, 283, 306, 311, 318, 322; moral 120, 129, 133, 139, 154, 156, 158, 217; social 120, 155, 195, 202–3, 231, 296, 299, 316

Diatkine, Daniel 23–6, 34 Dickie, Simon 70, 87 Diderot, Denis 34, 319–20, 321, 323, 338 Dierksmeier, Claus 217, 227, 229 dignity 51, 55–60, 64, 65–6, 153, 156, 158, 334, 339; Diogenes Laertius 164–5, 174; Lives of Eminent Philosophers 164–5 Diogenes of Sinope 80 distance: emotional 100, 170; moral 101, 105, 106; physical 255; social 204, 206–7, 294, 303 division of labour: and alienation 7, 12, 255, 274–5, 292; and commercial society 157, 236, 315; and development 162, 207, 209, 234–6, 241, 245–6, 314–15; and economic growth 162, 183–4, 227, 235, 238, 251, 255, 259, 272, 274, 313–14; origin/causes of 178, 183–4, 191, 196–7, 203, 206, 316–17, 329–30 Dobb, Maurice 180, 191 Dobson, C.R. 264, 265 Dolgoy, Erin A. 159 Dooley, Peter C. 176, 191 Drosos, Dionysios G. 292, 303 Duchet, Michèle 323 Dunning, Eric 87 du Pont de Nemours, Pierre Samuel 35, 46 Durkheim, Émile 294, 296, 303; The Division of Labour in Society 296 Dussart, Hyppolite 34 economics: father of 147, 325, 328, 337; neoclassical 180, 182, 250, 334 education: moral 133, 135, 141; natural 128–39, 140–1; public 128, 136, 140, 141, 213, 239; social 137–8; spending on 252, 275; of youth 227, 275; see also self-education efficiency 30, 147, 151–2, 154, 157–8, 316 egalitarianism 183, 221 egoism 339 Elias, Norbert 70, 76, 86, 87; Essay of Laughter 86 Eliot, George 108 Elliot, Gilbert 142

352 Index embodied labour theory of value 175–6 Emerson, Roger 128, 142 empathy 89–90, 101, 104, 166 emulation 136, 139, 203 Engels, Friedrich 286, 304 Enlightenment 8, 85, 193, 207 equality/inequalities 51–2, 148, 153, 156–8, 227, 235, 244, 251, 253, 257–8, 261, 264, 265, 281, 298, 313, 316, 320, 339 Eriksson, Bjorn 290, 303 ethics 37, 52, 58, 63, 66, 75, 162–8, 171, 193–228, 327, 333, 337; foundations of 199 Evensky, Jerry 128, 142, 208, 209 evolution 4, 186, 189, 191, 203, 206, 208, 243, 245–6, 271–3, 296, 306, 311, 313, 318 exchange(s): commercial 40, 117–19, 151, 153, 158, 161, 169, 231–3, 257, 289, 295, 298, 329–20; fair and deliberate 330–1, 334–7, 339; market 5, 7, 176, 180–6, 188–9, 190, 204, 206, 239–40, 243–4, 246, 265, 313–19, 327, 330–7; see also truck, barter, and exchange fair and deliberate exchange 330–1, 334–7, 339 fair, fairness 147–8, 151–5, 158, 168, 188, 242, 251, 257, 331, 333–7 fair play 147, 155, 167–9, 172 father of economics, Smith as 147, 325, 328, 337 Ferguson, Adam 195, 209, 257, 258, 259, 264, 265, 270, 274, 283, 289– 94, 298–302, 303, 310, 322, 323; An Essay on the History of Civil Society 264, 290, 291, 292–4, 302; Institutes of Moral Philosophy 294; Principles of Moral and Political Science 290, 291, 293; Reflections Previous to the Establishment of a Militia 292 Ferreira, M. Jamie 90, 107 Fielding, Henry 75, 169 Fiori, Stefano 7, 12, 13, 15, 96, 105, 106, 107, 273, 276, 281, 285 Firth, Ann 128, 142 Fleischacker, Samuel 65, 66, 67, 90–1, 107, 127, 134–5, 142, 156, 159, 221–2, 225, 228, 229, 250, 264, 265, 283, 285, 328, 339, 340

Foisneau, Luc 88 Foley, Duncan K. 228, 229 Føllesdal, Dagfinn 107 Fontaine, Philippe 89–90, 104, 107 Forbes, Duncan 270, 283, 285 Force, Pierre 134, 142 Forget, Evelyn Louise 106, 107 Forman-Barzilai, Fonna 106, 107, 133, 134, 142 Forster, Michael Neil 285 four stages theory 186, 245, 270–3, 281, 283–4, 306, 311–13, 319 Fracastoro, Girolamo 92–3, 94, 107; De sympathia et antipathia rerum 92 Franz, Michael 174 Frazer, Michael L. 90, 103, 107, 128, 142 freedom 42–3, 52, 64, 148, 151, 153, 157–8, 224, 240, 242, 255, 257, 259–61, 263, 264, 289–291, 294, 297–300, 337 free market(s) 239, 243, 281 free trade 39, 41–2, 166, 240, 278, 281 Fricke, Christel 107, 128, 133–4, 141, 143 Friedman, Milton 334, 340; Capitalism and Freedom 334 friendship 75, 150, 154, 158, 184, 188, 204, 294, 303 Galilei, Galileo 208 Garland, Alex 173 Garrett, Aaron 143, 283, 285 Gay, Peter Joachim 263, 265 general rules 41, 58, 104, 155–6; of morality 180, 188 Genghis Khan 79 Gibbon, Edward 270, 283, 285; The History of the Decline and Fall of the Roman Empire 270 gift theory 184–8, 204, 206, 319 Glahe, Fred R. 159 God 3, 5, 6, 8–12, 181, 208, 269, 281, 282, 325 golden rule 164, 166 Gombaud, Antoine, Chevalier de Méré 72 Goodwin, Craufurd David Wycliffe 46 Goudsblom, Johan 87 Graafland, Johan 228, 230 Graham, Gordon 10, 15, 195, 209 Gramm, Warren S. 281, 285

Index  353 Grampp, William Dyer 281, 285 gratitude 186–9, 200–1 Griffin, Miriam 142 Griswold, Charles. L., Jr. 64, 65, 66, 67, 82, 87, 113, 124, 125–6, 127, 128, 133, 134–5, 143, 177, 191, 197, 209, 221–2, 228, 229, 339, 340 Grotius Hugo (Huig de Groot) 254 growth: commercial 272, 278–9; economic 5, 33–4, 40–1, 44, 148, 151, 153, 158, 162, 236, 253, 272, 282 Guez de Balzac, Jean-Louis 72–3, 87; Du style burlesque 72; Œuvres 72–3 Haakonssen, Knud 9, 14, 15, 124, 125, 127, 133, 134, 142, 143, 177, 191, 265, 270, 283, 285 Hale, Kimberly Hurd 159 Halls, Wilfred Douglas 248, 303 Hamoway, Ronald 3, 15 Hankins, Keith 127 Hanley, Ryan Patrick 10, 15, 65, 67, 74, 82, 85, 86, 87, 125, 127, 128, 139, 140, 143, 159, 222–3, 228, 229, 283, 285, 340 happiness 9, 14, 29–30, 32–3, 55, 79–80, 83–4, 103, 128, 130, 134, 136–7, 139, 154, 156, 166–7, 178, 205, 216–24, 228, 231, 249, 279, 282, 298, 332–3 Hardwick, David F. 16 Harkin, Maureen 276, 285, 309, 321–2, 323 harmony 22, 33, 61, 89, 92, 94, 97, 109, 113, 115, 125, 134, 137, 141, 199, 200, 203–7, 322 Harris, James A. 285 Harris, Jose 174 Harrison, Peter 10, 15, 338, 340 Hay, Douglas 261, 265 Hayek, Friedrich August von 4, 14, 15, 16, 247, 248 Heath, Eugene 7, 16 Heilbroner, Robert L. 128, 134, 143, 249–50, 265, 282, 285, 290, 304 Heise, Paul Anthony 174 Hengstmengel, Joost 283, 285 Herder, Johann Gottfried von 89, 166, 282, 285; This Too a Philosophy of History 282 Herzog, Lisa 65, 66, 67, 221, 229

heterogony of ends 269–70 Hett, Walter Stanley 107 Heydt, Colin 10, 16, 128, 143, 283, 285 Hicks, Robert Drew 107, 174 hierarchy 77, 153, 205, 257–9 Hill, Lisa 8–9, 14, 16, 228, 229, 245, 248, 274, 283, 285, 289, 290, 291, 293, 294, 303, 304 Hirschman, Albert Otto 316, 322, 323, 324 historical analysis 4, 23, 37, 178, 231, 272, 281 historical evolution 141, 249, 270, 311, 318–19 historical materialism 270 historical narrative 85, 272 history: conjectural (see conjectural history); counterhistory 273; of economic thought 35, 38, 42, 45–6; natural (see natural history); of science 38; stadial (see four stages theory) Hobbes, Thomas 69, 70, 72–3, 75–7, 85, 171, 208, 312 Hollis, Margaret 174 Holt, Andreas 327 Home, Henry (Lord Kames) 270, 276 Hont, István 271, 284, 286 Höpfl, Harro M. 284, 285 Hübner, Karolina 93, 105, 107 Hühn, Matthias P. 217, 227, 229 human autonomy 193 human beings 59, 91, 93–4, 97, 99, 101–2, 109, 117, 120–1, 128–31, 134–5, 137–41, 153, 158, 214, 231, 233, 236–7, 243–6, 247, 273, 331, 337 humanity 32, 56, 62, 64, 149–51, 154, 158–9, 187, 226, 232–3, 309, 317 human life 75, 155, 178, 203, 218–19, 226 human nature 12, 54, 62, 68–9, 78, 81, 92, 101, 128, 130–1, 133–4, 138–9, 140, 154, 159, 196–7, 231, 237, 276, 311, 316, 318–19, 330, 332, 335, 337 Hume, David 23, 34, 40, 41, 56, 80, 85, 89–91, 97–102, 104–5, 106, 108, 109, 111–12, 124, 125, 127, 141, 150, 191, 195, 198, 209, 214, 235, 253, 263, 265, 270, 274, 322, 325–7, 332, 333, 338; An Enquiry Concerning Human Understanding

354 Index 98, 101, 106; An Enquiry Concerning the Principles of Morals 263; A Treatise of Human Nature 23, 90, 98–102, 104, 106, 107, 109, 111, 125, 198 hunters 173, 179–81, 183–4, 186, 188–90, 236, 306, 308, 312, 318, 320, 328, 330 Hutcheson, Francis 71, 73, 75–6, 85, 86, 87, 96, 108, 131, 143, 195, 202, 209, 257, 264, 265; An Essay on the Nature and Conduct of the Passions 131, 195, 202; Logics, Metaphysics and the Natural Sociability of Mankind 75; Reflections upon Laughter 75; A System of Moral Philosophy 96, 257, 264 Hutton, James 338 Ignatieff, Michael 294, 304 Imagination: mimetic/creative 110, 115–20, 123–4, 126–7; and personal identity 95, 101, 105; practical/theoretical 109–10, 115, 125 imitation 173, 308 immanentism 269, 283 impartiality 129, 141, 155 impartial spectator 53–4, 56–7, 63, 82, 84, 120–2, 126–7, 129–31, 134–7, 139, 149, 155–7, 170, 183, 190, 200–2, 205, 217, 220, 226, 238, 251, 275, 333 impersonal market(s) 185, 189, 295, 297 independence 153, 223–4, 249, 257, 260, 261–3, 291, 302, 320 indifference 52, 54, 63–4, 66, 78, 82 indignation 78, 147–8, 167, 279 individualism 293; see also possessive individualism individual liberty 270, 334 inequality: natural 281; oppressive 253; socio-economic 227, 235, 251, 264, 281, 298, 313 injustice 11, 60, 151–2, 186, 187, 188, 216, 219–20, 246, 280, 281, 282, 298 innate human dispositions 11, 155, 157 intentions 4–5, 9, 11, 66, 93, 245, 336 interdependence 169, 194, 224, 289, 295, 296

interest: general 32; in the other(s) 199, 203–6; national 32; particular 32; private 169, 280, 289, 293; public 169; see also self-interest invisible hand(s) 3–15, 39, 162–4, 168, 174, 226–7, 241, 269, 281, 283, 315, 336, 338 Irwin, Douglas A. 151, 159 Jacobs, Struan 4, 16 James, Jr., Harvey S. 227, 229 Jardine, Lisa 107 Jary, David 296, 304 Jary, Julia 296, 304 Jefferson, Thomas 310, 323 Jephcott, Edmund 87 Johnson, Samuel 73, 339, 340 Jones, Marc 217, 227, 228 Jones, Peter 142 Jonze, Spike 174 judgements: emotional 171; ethical, moral 171, 178, 197, 200, 202, 205, 238, 269, 278 Jupiter 4, 10–11 jurisprudence 156, 236, 257–8, 263, 264–5, 271, 325, 337 justice 11–12, 58, 148, 157–8, 186–8, 202, 213, 219–20, 238, 241–2, 261, 290, 299–302, 316, 325, 335, 339; and benevolence 186–8; and commercial society 151–3; distributive 264; laws of 156, 168, 188–9, 228, 239, 242, 316; rules of 156, 180–1, 185–6, 243 Justman, Stewart 214, 228, 229, 283, 286 Kalisch, Eleonore 174 Kames, Lord see Home, Henry Kantianism 60, 63–4 Kant, Immanuel 52, 63, 64, 66, 89, 170, 202, 208, 209, 272; categorical imperative 201; Groundwork of the Metaphysics of Morals 208 Kaye, Frederick Benjamin 143, 208, 210 Kegan Paul, Charles 87 Kelly, Christopher 287 Kennedy, Gavin 3, 7, 10, 16, 281, 283, 286 Kepler, Johannes 208 Kerr, Prue 37, 46 Keynes, John Maynard 245, 248, 251 Khalil, Elias L. 65, 67

Index  355 King, Steven 264, 266 Kircher, Athanasius 105 Kircher, Rudolf 168–9, 174 Kleer, Richard A. 14, 16 Klein, Lawrence Eliot 88, 108 Klump, Rainer 247, 248 knowledge: concrete 177; contextual 177, 183; dispersed. 244; economic 244; public 183; scientific 125; system 177; theory of 19, 33; universal 14 Kopajtic, Lauren 65, 66, 67 Kropotkin, Pëtr Alekseevič 246, 248 Kuin, Inger Neeltje Irene 80, 87 labour: alienated 259, 292; division of (see division of labour); embodied 175–6, 182; productive/ unproductive 42–4, 179, 299; quantity of 176, 182, 190; slave/ enslaved 152, 249, 276–7; specialization of 117, 120, 181, 183, 190, 289, 291, 293–303; theory of value 175–91 labourers 43, 152–3, 172, 184, 218, 224, 235, 249–64, 274–6, 292, 313 Lachmann, Ludwig Maurits 208, 210 Lafitau, Joseph-François 307, 308, 320, 321, 323 Lahontan, Louis-Armand de 310, 320 laissez faire 12, 14, 195, 213, 339 Laslett, Peter 191 Laurent, John 142 law(s): natural, of nature 117, 123, 181, 237, 271; state 237 Lazaro, Raquel 15 Lecaldano, Eugenio 89, 108 Leddy, Neven Brady 81, 87 Lehmann, William 289, 304 Lennon, Thomas M. 108 Leonardo da Vinci 115 Léry, Jean de 307 Levy, David 153, 159 Levy, David M. 183, 190, 191, 192, 339, 340 liberalism 207, 244; see also ordoliberalism liberism 240, 243, 247 liberty: individual 270, 334; natural 12, 41, 44, 45, 157, 196, 208, 239, 240, 244, 245, 254, 257, 261, 263, 278, 280, 316, 319; perfect 43, 261, 278; and security 223, 274, 299 Lieberman, David 265

Ligota, Christopher 86 Lindgren, John Ralph 89, 108 Lipps, Theodor 89 List, Regina A. 304 Locke, John 40–1, 106, 162, 165, 170, 171, 175–6, 191, 207, 208, 264, 312; An Essay Concerning Human Understanding 106; Two Treatises of Government 175 Lothian, John M. 338 love: of self (see self-love); of system(s) 18–19, 22–30, 32, 37, 80; see also self-love Luban, Daniel 14–15, 16, 276, 286 Lucian of Samosata (Lucianus Samosatensis) 71–3, 74–5, 77, 80–1, 87 MacCormick, Neil 237, 245, 246, 248 Macfie, Alec Lawrence 4–5, 11, 16, 339 machinery 114, 176 MacLeod, Matthew Donald 87 Macpherson, Crawford Brough 161, 171, 174 MacRae, Donald 289, 304 Malebranche, Nicolas 94–5, 97, 102, 106, 108; The Search after Truth 94–6, 102, 106 Mandeville, Bernard de 131, 143, 194–5, 208, 210, 263, 274 manufacture(s) 39–40, 42–3, 113, 243, 252–3, 255–6, 258, 262, 274, 289–90, 292, 296, 299, 328 man within 53, 56, 130, 142, 200 Marchionatti, Roberto 283, 286, 307, 308, 309, 319, 321, 323, 324 Marivaux, Pierre Carlet de Chamblain de 81–2, 86 market economy 161, 162, 221, 244, 258, 291; social market economy 247 market exchange see exchange(s) market price(s) 181–2, 185, 240–1, 244 market society 163, 164, 169, 291, 298, 303, 316; see also commercial society Marouby, Christian 284, 286, 309, 310, 321, 323, 324 Marsh, Leslie 16 Martin, David A. 14, 16 Martin, Thomas R. 80, 87

356 Index Marx, Karl 162–3, 176, 182, 192, 238, 274–5, 286, 292, 304; Capital. A Critical Analysis of Capitalist Production 182, 274, 292; The Poverty of Philosophy 274, 292; value theory 180, 182 Masters, Roger Davis 287 Maurer, Christian 134, 143, 303, 304 Mauss, Marcel 246, 248, 319, 323, 324 McCloskey, Deirdre Nansen 65, 67, 328, 340 McDowell, Nicholas 75, 87 McKenna, Stephen J. 339, 340 McLean, Iain 247, 248 Meardon, Stephen J. 65, 67 Meek, Ronald Lindley 151, 159, 197, 210, 270, 283, 286, 311, 319, 323, 324 Menippus of Gadara 80 Mennell, Stephen 87 mercantilism, mercantile system 32, 33, 36, 38–45, 178, 240, 284, 278; see also commercial system Mercer, Christia 92, 108 Mercer, Philip 90, 99, 108 merchants 13, 41, 42, 118–19, 126, 255, 283, 297 merchants and manufacturers 40, 43, 151, 172, 259, 262, 278–80 Méré see Gombaud, Antoine metaphor(s) 3–8, 12–13, 14, 39, 70, 72, 73, 86, 94–6, 97, 102, 105, 126, 162–3, 168, 169, 269, 338 methodology 36–8, 197, 322 militias 299–300 Millar, John 209, 270 Millican, Peter 108 Mill, John Stuart 195, 208, 209 Mirowski, Philip 240, 248 mirror, society as 161 Mizuta, Hiroshi 142, 264, 266 modernity 8, 19, 23–4, 28–30, 33, 36, 46, 51–2, 68–72, 74, 85, 129, 140, 162–3, 175–6, 180, 188–9, 195, 202–3, 208, 209, 231–6, 237–8, 257, 275–7, 282, 302 monopolies 152, 190, 244, 257, 278–81 Montaigne, Michel de 93, 307, 310, 321 Montes, Leonidas 64, 65, 66, 67, 159, 337, 339, 340

Montesquieu, Charles-Louis de Secondat, de La Brède et de 311, 321, 322, 324; The Spirit of the Laws 321, 322 Moore, James 87 Moore, Samuel 286 moral conscience see conscience moral duties 320 moral education see education morality 54, 74, 123, 130, 178–80, 194, 196, 198, 199–202, 206–7, 232–3, 237–8, 241, 282, 310, 325, 328, 331, 333–7, 339 moral judgement(s) 178, 197, 200, 202, 205, 209, 238, 269, 278 moral philosophy 62, 128, 164, 179, 184, 209, 222, 337, 339 moral sentiments 69, 79, 80, 82, 103, 105, 140, 205 moral theory 63, 149, 196 moral values 194, 202, 309 moral virtue(s) 65, 242, 332 Morice, George P. 127 motivation(s) 18, 23, 25, 37, 66, 104, 112, 151, 164, 250, 336 Muldrew, Craig 264, 266 Munro, Hector 208, 210 Mun, Thomas 40, 41 Murdoch, Dugald 107 Muthu, Sankar 284, 286 mutual aid 231, 246 mutual benefit(s) 295, 302, 317, 336 mutual need 295 mutual respect 84 mutual sympathy 155, 226, 331 Nathan 173 nations: civilized (see civilized nations); savage 306, 308, 321, 322, 328 natural education see education natural freedom 249, 261 natural history 273 natural law/lawyers 237, 254, 257, 271 natural liberty see liberty natural order 9, 135, 181, 207, 271, 273 natural price(s) 175, 179, 181–2, 185, 252–3, 273 natural progress 273 natural rights 208 natural wages 252, 264

Index  357 Necker, Jacques 258–9, 264, 266; Sur la législation et le commerce des grains 259 neoclassical economics 180, 182, 250, 323, 334 neoliberalism 169 Neuman, Franz 324 Newtonian method 37, 197, 199, 202 Newton, Isaac 37, 112, 117, 208 Nolla, Eduardo 88 Norman, Jesse 227, 228, 229 normative/descriptive see descriptive/ normative Norton, David Fate 127 Norton, Mary J. 127 Nozick, Robert 4, 16 Nugent, Thomas 324 Nussbaum, Martha 82, 87, 137, 140, 143 Okan, Ecem 271, 272, 286 Olscamp, Paul J. 108 optimism 9, 76, 177, 250, 290 opulence 148, 150, 151, 158, 178, 239, 241, 250, 251, 274, 299, 306, 313–16, 318, 329–30 order(s): and chaos, disorder 11, 21, 282; desire for 20–2; of providence 309, 322; social 4, 8, 9, 11, 14, 68, 77, 84, 188, 193, 194, 282, 316; spontaneous 3–15, 178–9, 195; see also natural order ordoliberalism 244, 247 Ortmann, Andreas 65, 67 Oslington, Paul 10, 16, 283, 286 Otteson, James R. 14, 16, 64, 65, 67, 90, 101, 108, 155, 159, 227, 228, 229 Oz-Salzberger, Fania 209, 265, 304 Pack, Spencer J. 8, 16, 273, 276, 286, 290, 304 Paganelli, Maria Pia 16, 66, 67, 106, 108, 143, 148, 149, 150, 151, 156, 159, 160, 228, 230, 247, 248, 265, 283, 284, 286, 287, 288, 322, 323, 339, 340 Pangloss 9 Panizza, Letizia 86 Parvulescu, Anca 87 Pascal, Blaise 77, 87; The Thoughts 77 Pascal, Roy 270, 283, 287 passion(s): of the body 91, 102–3, 105; disinterested 291; moral 91,

103, 104–5; natural 148, 156; selfish 18, 52, 63, 134–5, 155; social/unsocial 32, 164; of the soul 93–4, 103, 105; undisciplined 60 Paton, Herbert James 209 Pauchant, Thierry C. 311, 324 Peabody, Bruce 159 peace 77, 80, 239, 246, 264, 300, 310 Peart, Sandra J. 183, 192, 339, 340 Pennuto, Concetta 107 Perelman, Michael 297, 304 Perrot d’Ablancourt, Nicolas 72–3, 87; Lettres et préfaces critiques 72 Persky, Jospeh 281, 287 personal freedom 261, 264 personal independence 262 personal rights 168 persuasion 203, 330–1, 333–7 Pesante, Maria Luisa 284, 287 Petsoulas, Christina 4, 16 Petty, William 40, 41 Philip, Franklin 287 Phillipson, Nicholas 283, 287 physiocracy, agricultural system 32, 36, 38, 42–4, 45, 46 Physiocrats 35, 42–4, 195, 208 Pitts, Jennifer 69, 85, 87, 283, 287 Plato 127, 140; The Apology of Socrates 127 Plehwe, Dieter 240, 248 Plotinus 94 Plutarch 218 Pocock, John Greville Agard 270, 271, 284, 287 Polanyi, Michael 4, 17 political economy 32, 36, 38, 41, 42, 44–5, 46, 161, 217–18, 311, 314–15, 319–20, 325–7, 333, 337 political rights 262 Polo, Marco 151 poor man’s son 79–80, 213–28, 333, 339 Porta, Pier Luigi 192 positive laws 155, 253, 254 possessive individualism 161–2, 165, 167, 170, 231, 232, 280–1 poverty 80, 149–50, 151, 158, 273, 274, 283, 306–7, 309–10, 319, 320 price(s): component parts of 179; market 181–2, 185, 240–1, 244; natural (see natural price(s)); real 227 primitive societies 263, 276, 306–9, 315, 317–19, 323

358 Index principles: of conduct 126, 226; ethical 198; of human nature 134; of modern legal systems 237; moral 207; of nature 21, 272 private appropriation 234, 235 private property 162, 188, 202, 233–4, 238, 244, 247 production: and allocation, distribution 43, 234, 246, 247, 257; means of 244, 283; socialization of 234 productive/unproductive labour see labour progress: commercial 290, 329; of the division of labour 162; economic 113, 117, 119, 124; historical 231, 236–7, 239, 241, 249, 269–74, 276–7, 280–3, 291, 293–4, 296, 311, 314, 322, 328–9; of the human mind 20–1, 31; moral 123; scientific 41, 124; societal 31, 238, 339; technological 109, 113–15 progressivism 269, 271, 272, 281, 290 property: accumulation of 245; division of 5; inequality of 313; intellectual 234; origin of 191, 271; rights 162, 186, 189, 191, 238, 271, 272, 311–12; see also private property propriety: and dignity 60; and impropriety 132, 201, 246; standards of 71, 81 providence 3, 5, 6, 8, 9–11, 14, 75, 163, 269, 282, 309, 322 providentialism 269 providentialist reading of Smith 8, 269 public education see education Pygmalion 173 Pyrrhus 218 quantity of labour/work see labour Quesnay, François 43–4, 195 Quintilian, Marcus Fabius 69, 70, 87; Institutio Oratoria 69 Rackham, Harris 86 Raison, Timothy 304 Randall, Adrian 266 Raphael, David Daiches 56, 65, 67, 124, 125, 127, 217, 229, 323, 324, 339 Rasmussen, Dennis Carl 223–4, 228, 229, 274, 275, 287, 338, 340 Rassekh, Farhad 227, 229

Rawls, John 247, 248; A Theory of Justice 247 Raynal, Guillaume Thomas François 319, 324 reciprocity 166, 185, 187–9, 319, 336 Recktenwald, Horst Claus 339, 340 Reisman, David Alexander 228, 229 religion(s) 4, 10, 14, 21–2, 96, 282 resentment 11, 59, 78, 104, 147–8, 156, 167, 172, 186–7, 200–2, 219 responsibility 138, 275 retaliation 156, 164, 166, 187 Ricardo, David 176, 190 Riccoboni see Balletti Riccoboni, Elena Virginia rights: natural (see natural rights); political (see political rights); property (see property rights) Rima, Ingrid Hahne 46, 47 Rizzolatti, Giacomo 89 Robertson, William 270, 322 Robinson, Christopher 74, 88 Robinson Crusoe 333 Roncaglia, Alessandro 37, 47 Rorty, Amelie 143 Rosenberg, Nathan 208, 210 Ross, Ian Simpson 142, 143 Rothschild, Emma 8, 14, 17, 128, 143, 196, 210, 228, 229, 282–3, 287 Rousseau, Jean-Jacques 22, 28, 34, 51, 80, 89, 270, 272, 273, 282, 287, 308, 321, 326, 337, 339; Discourse on the Origin of Inequality 273; Discourse on the Sciences and Arts 273 Rubik, Ernő 26 rude and barbarous nations 51, 243, 275, 293, 301, 309–10, 320 rudeness 70, 72, 75, 103, 306, 320 Rule, John 255, 264, 266 rule of law 261, 334 rules: of behaviour/conduct 58, 105, 189; of beneficence 188; of gratitude 186, 188–9; of justice 156, 185–6, 243; of morality 180; of natural equity 253; of nature 208; of reason 208; of reciprocity 188 Russell, Donald Andrew 87 Russell, Paul 282, 287 Sagard, Gabriel 307 Sagar, Paul 159, 284, 287, 304, 338, 339, 340

Index  359 Sahlins, Marshall 307, 308, 321, 324 Salter, John 270, 287 Samuelson, Paul 3 Samuels, Warren Joseph 13, 17 savage nations 306, 321, 322, 328 savages 141, 235, 308–11, 313, 318, 319, 320, 321, 329 Sayer, Derek 290, 303 Say, Jean-Baptiste 44 Scazzieri, Roberto 192 Scheler, Max 89 Schelle, Gustave 34, 266 Schleifer, James Thomas 88 Schliesser, Eric 12–13, 17, 86, 88, 107, 108, 127, 132, 140, 143, 154, 159, 228, 229, 257, 263, 266, 336, 341 Schmidtz, David 227, 228, 229 Scholliers, Peter 266 Schorr, David B. 283, 287 Schumpeter, Joseph Alois 37, 39, 44, 45, 47, 163 Schwarze, Michelle A. 11, 15, 17 Schwarz, Leonard 266 Scotland in age of Smith 289–90 Scott, Henry, 3rd Duke of Buccleuch 325, 326 Scottish Enlightenment 3, 15, 89, 195, 274, 290, 321, 338 Scottish Historical School 37, 270 Scottish moral philosophy 164 Scott, John T. 11, 17 secularisation 269 Seigel, Jerrold 137, 140, 141, 143 Selby-Bigge, Lewis Amherst 34, 108, 209 self-approbation 57, 59, 60, 65, 131, 136–7, 141 self-command 51–66, 128–9, 133, 135, 137–9, 149–50, 155, 158, 217, 276, 302, 322 self-control 66, 70, 141, 302 self-education 128, 138 self-interest 9, 13, 18, 24, 37, 51, 52, 55, 77, 117, 153, 159, 187, 188, 189, 195, 196–7, 205, 206, 225, 227, 246, 278, 289, 291, 297, 301–2, 332–3, 334–7, 339 selfishness 5, 163, 195, 225, 332 selfish passions see passion(s) self-love 31, 54, 58, 126, 131, 134, 140, 147, 155, 164, 167, 170, 187, 232–4, 244, 246, 256, 298, 317, 332 self-spectatorship 57

Sellars, John 304 Sen, Amartya 228, 229, 281, 287, 322, 324 Seneca, Lucius Annæus 63, 72 Seoane, Julio 15 servants 215, 251–2, 263, 265 Sgard, Jean 82, 88 Shaftesbury, third Earl of (Anthony Ashley-Cooper) 51, 68, 71–2, 73, 75–6, 85, 88, 96, 108; An Essay on Ridicule 71; A Letter Concerning Enthusiasm 71, 96; Sensus Communis 71 Shapiro, Michael Joseph 283, 287 Silver, Allan 297, 305 Silverthorne, Michael 87, 107 Simon, Fabrizio 148, 156, 159, 160 Skarżyński, Witold von 336, 339, 341; Adam Smith als Moralphilosoph und Schöpfer der Nationalökonomie 339 Skinner, Andrew Stewart 124, 127, 142, 192, 265, 270, 283, 287, 337, 341 Skinner, Quentin 70, 88 slave/enslaved labour see labour slavery 152, 243, 255, 261, 276–8, 337; see also colonial slavery slaves 152–3, 261, 276–8 Smith, Craig 4, 14, 17, 22, 34, 227, 229, 283, 287 Smithers, Peter 107 Smith, Gregory 107 Smith, Vernon Lomax 147, 160 social science(s), sociology 8, 12, 13, 38, 41, 170, 193, 208, 290, 295, 302 Socrates 79, 122, 123, 127 solidarity, mechanical/organic 294–6 Sorell, Tom 88 specialization see labour spectator(s) see impartial spectator Spinoza, Baruch 93–4, 106, 108; Ethics 93–4, 106 spirit of system 19, 27, 29–33 spontaneous order see order(s) stadial theory see four stages theory stages/ages/states see four stages theory Steele, Richard 97, 107; The Spectator 96–7 Steiner, Philippe 258, 259, 264, 266 Stein, Peter Gonville 247, 248, 323, 324

360 Index Steuart, James 41, 44, 47, 257, 258, 259, 264 Stewart, Dugald 37, 44, 177, 191, 271, 311, 322, 325 Stikkers, Kenneth W. 9, 14 Stoicism 52, 60, 63–4, 66, 140 Stoothoff, Robert 107 Strahan, William 327 Strasser, Hermann 290, 305 subordination 320 Sugden, Robert 90, 108 Sugiyama, Chuhei 142 Swift, Jonathan 74, 78, 82 Swingewood, Alan 289, 305 sympathetic community, interaction, relationship(s) 69, 94, 100, 133, 137–8, 141, 158, 189 sympathetic emotions, feelings 62, 78, 81 sympathetic exchange(s), experience(s), process(es) 54, 69, 82, 84, 92, 97, 103, 105, 133–4, 137, 139, 333 sympathetic identification 84 sympathetic imagination 109–10, 115, 125 sympathetic judgement(s) 62, 128–9, 139 system of natural liberty 12, 41, 44, 45, 157, 239–40, 244–5, 257, 278, 316, 319 system(s): love of (see love); spirit of (see spirit of system); system building 29

Toepler, Stefan 304 Tönnies, Ferdinand 161, 167–8, 174; Community and Civil Society 161, 167–8 trade: balance of 39–41; foreign 279; free 39, 41, 42–3, 166, 240, 259, 278, 281; regulation of 41; specialized 114, 117–18 Trajan (Marcus Ulpius Nerva Traianus) 86 tranquillity 216, 225, 228, 280, 282, 283 Tribe, Keith 231, 248, 339, 341 Trivigno, Franco V. 87 truck, barter, and exchange 119, 157, 197–8, 202–3, 209, 232–3, 236, 247, 294–5, 316–19, 330, 338–9 Tucker, Josiah 256–9, 264, 266 Turgot, Anne Robert Jacques 31, 34, 44, 195, 209, 263, 266, 322; Éloge de Gournay 31; Letter to Hume (March 25, 1767) 263; Recherches sur les causes des progrès et de la décadence des sciences et des arts 31

Tacitus, Publius Cornelius 86 Tamerlane 79 taxonomy 21, 76, 270–1, 283 Taylor, Jaqueline 90, 108 Tegos, Spyridon 228, 230, 284, 288 teleology 9, 163 theodicy 9, 12 theological arguments 8, 14, 273 theological interpretation 269, 283 theological language 8 theological metaphors 269 theological notions 3, 8 Ther, Philipp 240, 248 Thevet, André 307 Thomas, Alex 128, 143 Thrasher, John 127 Tocqueville, Alexis de 81, 88; Democracy in America 81 Todd, William B. 127

value, labour theory of see labour van Suntum, Ulrich 164, 174 vengeance 165–6, 171–2 Viner, Jacob 151, 160, 197, 210, 338, 341 virtue(s): bourgeois 55, 65; civic 291, 299, 303; ethical, moral 60, 65, 242, 332 Vivenza, Gloria 65, 66, 67, 76, 88

unintended consequences 3–4, 6–9, 11–15, 178, 204, 328, 330, 335; benign/malign 4, 6–7, 11–12; and spontaneous order 3, 6–9, 178 unproductive labour see labour unsocial passions 164 utilitarianism 196, 209 utility, search for 23–4, 25

wage labourer(s), wageworker(s) 172, 249–59, 262–3, 274–6, 290 wage(s) 153, 179, 190, 235, 249–59, 263, 264, 278, 290 Walraevens, Benoît 274, 285 Waterman, Anthony Michael Charles 273, 288 Weinstein, Jack 128, 143 Wells, Thomas 228, 230

Index  361 Werhane, Patricia Hogue 228, 230, 264, 266 West, Edwin George 208, 210 Whatmore, Richard 287 Whyte, Jessica 14, 17 Wierzbicka, Anna 334, 341 Wilson, Bart J. 147, 160 Wilson, Eric 66, 67 Wilson, Thomas 142, 265, 287 Winch, Donald 265, 266, 270, 283, 288, 290, 305 Winterbottom, Michael 142 Witztum, Amos 197, 201, 208, 209, 210

Woersdoerfer, Manuel 247, 248 Wolcott, Gregory 228, 230 Wolff, Larry 324 Wolloch, Nathaniel 283, 288 worker(s) see labourer(s); wage labourer(s), wageworker(s) Young, Allyn Abbott 315, 324 Young, Brian 287 Young, Jeffrey T. 180, 184, 192, 209, 210, 265 Zahavi, Dan 140, 143 Zuber, Roger 87