Adam Smith: 18th Century Polymath

Here is the intro to Roger Frantz’ chapter.

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Adam Smith (1723-1790) was a polymath with several of his key concepts and theories either having modern counterparts and/or “enjoying” empirical support. Smith wrote about the origin and proper use of language, grammar, the history of astronomy and ancient physics, moral philosophy, music, dance, and poetry, and; economics. Despite the very wide variety of topics there was, in my estimation, a common themes. One such theme is connections or inter-personal relations between and among people.

         Smith’s most famous book, at least to economists, is the Wealth of Nations (WN). In it, Smith discusses many things including the workings of a private market. A market is the exchange of things in which various motives influence market activity. In WN the motivation to engage in market activity is to improve your own economic conditions. What is exchanged is money for goods and services. In the Theory of Moral Sentiments (TMS) the motivation is the pleasure received from mutual sympathy. Smith says that:

nothing pleases us more than to observe in other men a fellow-feeling with all the emotions of our own breast; nor are we ever so much shocked as by the appearance (Smith, 1969, p. 13).

What is “exchanged” is personal sentiments and moral judgments.

         One common theme in Smith’s writings is the connections and interpersonal relations among people. Four questions related to the common theme in Smith’s writings are explored in this paper. First, why is language developed? Second, what is the purpose of good communication? Third, why are Newton’s writings considered of extraordinary importance? Fourth, what is the role of sympathy in human affairs?

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Adam Smith and French Political Economy: Parallels and Differences

The intro to Laurent Dobuzinskis’ chapter:

As is well known, Adam Smith spent about two years in Europe, most of it in France. It was in fact during his stay in Toulouse that he began to work on what became The Wealth of Nations (WN); but what proved decisive for the deepening of his understanding of market processes were his encounters in Paris with Paul-Henri Thiry (Baron d’Holbach), Claude Helvetius, Jean d’Alembert, André Morellet, Jacques Necker, and especially his discussions with Anne-Robert-Jacques Turgot and François Quesnay. (Quesnay was universally regarded as the leader of the so-called Physiocrats, who, in addition to Quesnay, included Pierre-Paul Le Mercier de la Rivière, Pierre Samuel du Pont de Nemours and Turgot but the latter did not rigidly subscribe to the core dogmas of that school.) Although no one denies that Smith was profoundly influenced by these encounters, the question of precisely what debt Smith owed to these thinkers is not central to my purpose here. It is, indeed, a controversial one. Roberts (1935), for example, argued that Smith drew heavily from the writings of Pierre Le Pesant de Boisguilbert whom he would have known through later writers; Du Pont de Nemours and the Marquis de Condorcet, on the other hand, suggested that anything of value in Smith’s WN could be found in what Turgot had written (Groenewegen 1968, p. 271). But this question is probably impossible to answer categorically, partly because Smith’s manuscript notes were destroyed after his death. To talk about an intellectual debt is to put the matter in terms that are too narrow and could be only of interest to erudite biographers.

What I propose to do is to paint in broader strokes the parallels—some intentional, some not—and the significant differences between Smith’s own thought and the French political economists who immediately preceded Smith (and some who immediately followed him)—what Joseph Schumpeter (1954, p. 492) called the ‘French tradition’ or, in any event, its most prominent representatives. My intention, in other words, is not to write an intellectual biography of Adam Smith but to use this investigation as a means of better appreciating the original contributions he made to economic theory and moral philosophy—as well as the less convincing aspects of his reflections—by setting them in a larger context where similar ideas where emerging. The first French political economists advanced a flurry of novel ideas, some of which were arguably more perspicacious than those of Smith. In the end, Smith’s talents in articulating a (more or less) coherent and imposing vision of the balancing of human drives and enterprising spirit stands out. But this should not prevent us from considering whether and to what extent some parts of his system turn out to have been no better and, occasionally, less well analyzed than they had been by his French contemporaries or immediate successors. Indeed some historians of economic thought, most notably Joseph Schumpeter (1954) and Murray Rothbard (1995), have gone as far as claiming that Smith did not contribute any new idea to the fledging political economy of his era. In the same vein, Henry Macleod (1896, p. 73) wryly noted that

Smith’s work and Condillac’s were published in the same year. Smith obtained universal celebrity in a very short time. Condillac’s was universally neglected, but yet in scientific spirit it is infinitely superior to Smith.

The challenge I face here is to take this charge seriously while also trying to be fair to Smith. In the next section, I trace the parallels and differences between Smith and the French political economists who preceded him in their attempts to understand markets as autonomous, spontaneous processes of coordination among myriad producers and consumers. Smith’s ‘invisible hand’ metaphor is very apt and telling but the idea behind it can be traced back much farther in time than Smith’s writings. In section II, I turn to a comparison between Smith’s labour theory of value and the French tradition’s more subjectivist approach. In section III, I underline the French political economists’ more perceptive views on the role of the entrepreneur whose presence is not quite as noticeable in Smith’s writings. Finally, in the concluding section, I identify the aspects of Smith’s political economy and moral philosophy that, on balance, stand out as unique contributions in spite of the weaknesses identified above, and briefly discuss the impact of the WN on the French political economists who read and reacted to it.

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Aside

Making Visible “the Invisible Hand”: The Mission of Social Simulation

Cristiano Castelfranchi’s interesting article. For more on the invisible hand see Propriety and Prosperity: New Studies on the Philosophy of Adam Smith with the following contributions:

Metaphor Made Manifest: Taking Seriously Smith’s ‘Invisible Hand’ by Eugene Heath

The ‘Invisible Hand’ Phenomenon in Philosophy and Economics by Gavin Kennedy

Instincts and the Invisible Order: The Possibility of Progress by Jonathan B. Wight

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Friendship in Commercial Society Revisited: Adam Smith on Commercial Friendship

Intro from Spiros Tegos’ chapter.

Friendship is a rather unusual topic for Adam Smith scholars given the emphasis that the concept of sympathy has received in the field of Scottish Enlightenment scholarship. However it has been quite rightly pointed out that Smith considered sympathy to be central to commercial motivation (See Hanley, ms). The emblematic Smithian motto, the effort of every single human being to better its condition is driven by the human desire ‘to be taken notice of with sympathy, complacency and approbation’ (TMS I.3.2.1). Throughout Smith’s oeuvre, to turn moderate wealth-getting into a widespread legitimate and ‘improving’ social activity is a priority. To this end, he pleads for the ‘trickle down’ effect of an increasingly productive economy together with the subsequent development of a social and cultural framework that will turn wealth-getting into a morally acceptable and politically manageable activity. In the same vein, an analogous, ‘proper’ consumption mentality should be equally developed, immune to the dangers of aristocratic conspicuous consuption and the subsequent ‘corruption of the moral sentiments’ due to boundless admiration of the rich and famous. In this specific context the idea that Theory of Moral Sentiments (TMS) is a ‘manifesto of middle class mores’ (Barzilai, 2010) gains acceptance. In this Smithian landscape, is there any place left for a modern conception of friendship beyond a vestigial classical legacy? The core claim of this paper is that there is something particularly original in Smith’s treatment of friendship. Indeed, Smith explores the void left once both the idealized, largely elitist ‘virtue friendship’ on the one hand and what one could name ‘kinship friendship’, that is enlarged family solidarity on the other become or are expected to become obsolete within commercial civilization.

In this chapter first I address an under-appreciated scholarly debate regarding the status of friendship within the framework of a declining clan based environment and an emerging commercial society such as was encountered in 18th century Scotland. I then examine Smith’s own conceptual strategy and terminology in added part VI of the TMS in its last edition (1790). New forms of social visibility and prestige emerge within the frame of commercial civil society. Friendship will be reframed and repositioned within a novel affective economy. This frame of analysis could be profitably set next to a broader agenda of Enlightenment ideals of enlarging one’s opportunities to interact with strangers expanding the circles of affective ties of individuals beyond the clan and the polis without reflecting classic cosmopolitan sensibilities. To conclude, elaborating the issue of refined, commercial affectivity, I thus succinctly address the existence of similar thought patterns in French enlightenment focusing on Sophie de Grouchy, Condorcet’s widow an important intellectual figure of the old regime. She highlights the transition of modern, ‘Scottish’ sympathetic affectivity in the immediate post-French revolution context, within a set of refined manners leading to the progress of civilization.

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Adam Smith as a Scottish Philosopher

Below is the intro to Gordon Graham’s chapter.

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Was Adam Smith a Scottish philosopher? The question seems an odd one. He was a philosopher and he was Scottish. What more could we need to know, in order to arrive at the simple answer ‘yes.’ And in any case, why does it matter? On reflection, however, neither the question nor the answer seems so simple, and both are more consequential than might be thought at first. Consider the case of David Hume. Hume was Scottish, and Hume was a philosopher, but at one time he was regularly excluded him from the canon of ‘Scottish philosophy.’ The reason is not hard to find. For a century or more Scottish philosophy was especially identified with Thomas Reid, the founding figure of a ‘Scottish School of Common Sense’, a ‘school’ that arose from sustained opposition to Hume. In The Scottish Philosophy of Common Sense Selwyn Grave writes:

The philosophy of Common Sense became ‘the Scottish philosophy’ and schooled several generations of Scotsmen. . . . Its history in Scotland began at Aberdeen with Thomas Reid’s teaching at King’s College and his papers to the Aberdeen Philosophical Society. . . The society, important both for the origin and expansion of the philosophy of Common Sense, was formed in 1758 and during its early years gravitated in a distant orbit round Hume. . . . Reid’s Inquiry into the Human Mind on the Principles of Common Sense, based on his papers to the Aberdeen Philosophical Society was published in 1764. . . . The philosophy of Common Sense arose as an ‘answer’ to Hume (Grave, 1960, pp. 1-4).

Grave is here expressing a view widely held, that the integrity and distinctiveness of ‘Scottish philosophy’ rests upon the exclusion of Hume. Being Scottish and being a philosopher, it seems, can at best be necessary conditions for being a Scottish philosopher. The case of Hume demonstrates that they may not be sufficient.

If Hume is not to be designated a ‘Scottish philosopher’, there are grounds for thinking that Smith is not to be designated in this way either. Smith’s friendship and personal admiration for Hume is well known. His profound intellectual sympathy for Hume is widely regarded as no less notable. Indeed, according to Nicholas Phillipson, Hume’s:

Treatise provided Smith with the foundations on which to base his own philosophical thinking’, Smith’s own contribution being primarily that of ‘developing a science of man on Humean principles’ by formulating ‘remarkable theories of language and property’ into which ‘he was to weave his own conjectural discussion of the assumption on which all Hume’s philosophy was based (Phillipson, 2010, pp. 69-71).

So from the simple facts that Smith was both Scottish and a philosopher, we cannot automatically derive a positive answer to the question with which we began.

Vernon Smith’s Foreward to Propriety and Prosperity: New Studies on the Philosophy of Adam Smith

Here is the opening paragraph to Vernon’s Foreward to Propriety and ProsperityI would urge anyone interested in situated cognition to read his superb Rationality in Economics: Constructivist and Ecological Forms amazingly an unknown classic to those of an externalist non-Cartesian persuasion. Also worth a read is Vernon’s memoir.

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This book is a welcome addition to the resurgent scholarly and practical interest in Adam Smith’s contributions to market economics and its antecedents in the social order of human culture. In Smith, propriety concerned the rules that govern human sociability by mutual consent in local group interactions. Out of this experience were fashioned the rules of property, justice and the liberal order of political economy, and thence to economic prosperity. It is a grand narrative alive with meaning for the contemporary world in which side-by-side with markets the demand for sociability has found new expression in the social media companies. No wonder that in a seminar Kenneth Boulding could refer to Adam Smith as the first great post-Newtonian scientist.