Wealth of Nations

¶ … Wealth of Nations, published in 1776 during the Age of Enlightenment and on the cusp of the Industrial Revolution, consists of Adam Smith's considerations on political economy. It is an accessible summation of economics and is highly valued as the first comprehensive work of its kind. As with most literature, The Wealth of Nations reflects its contextual social conditions; revolutionary ideas, technologies, and practices strongly influence the work. With this treatise, Smith sets out to explain an obvious social phenomenon -- the economic engine, combined with ways in which it may flourish.

A lucid description of national economy forms the introduction of the composition. Smith skillfully discusses the merits of dividing labor and the benefits of using machinery to increase production. This instructive passage exposes the powerful mechanism that connects society. Next, an examination of the development of industry and commerce along with urban and rural economic contributions provide the reader a panoramic grasp of economic history and progress. This generates a comparative analysis of two political economies, mercantilism and the agricultural system; Smith highlights the injury the former inflicts upon society. Smith concludes the study with a discourse on revenue and government's responsibility to provide public services through a sensible system of taxation.

A strong argument for free trade is embedded throughout Smith's accounts of economic axioms. In other words, the purpose of this treatise is twofold; it serves as an inclusive review of economic laws and as a rationale for an open market system. Smith's call for a less-restrictive economy mirrors the social movement in Europe at that time. Widespread economic hardship coupled with progressive ideas of the Enlightenment Age propelled society to seek an alternative economic system. Smith declares mercantilism -- the prevailing commercial system of the time, an obstacle to economic, political, and social advancement.

As mentioned, in mercantilism's stead, Smith envisions an economic system governed by capitalism. Acknowledging the benefits of the division and specialization of labor and industry, made chiefly possible by the advent of the Industrial Revolution, he proposes that individuals and domestic industries continue and improve upon this system. Smith recognizes that in such an environment, resources are managed and utilized most efficiently. What's more, rewards are plentiful for those with practical and innovative ideas, technologies, and practices. Through individual and business improvement, national advancement naturally follows; this is the principal force behind The Wealth of Nations.

Smith extends this idea to include international commerce; he advocates the removal of international trade barriers in order that nations may contribute their specialized and efficient industries to the global economy. Such notions were a drastic departure from the established mercantile system but were perceived as realistic resolutions to many of the economic problems of the time. Per Smith, specialization and division of labor and industry, on an individual, national, and international scale, are the prerequisites to incredible wealth. Said differently, tearing down international trade barriers consequently builds up international wealth.