On the new 20-pound note issued by Britain in 2007, the head of Queen Elizabeth II when she was young is on the front, and the profile of a curly-haired man is on the back.
This curly-haired man is Adam Smith, a great classical economist in Scotland. When Adam Smith is mentioned, most people first think of his book The Wealth of Nations, which is popular all over the world, and there is also a classic metaphor "invisible hand". What kind of book is The Wealth of Nations? What does "invisible hand" mean?
The full name of The Wealth of Nations is also called An Inquiry into the Causes and Nature of The Wealth of Nations. It is an economic masterpiece written by Adam Smith (1723- 1790), a British classical economist, which lasted nearly ten years. This book was first published in 1776.
1723 On June 5th, Adam Smith was born in Kirk Caldi, a small town with only about 1500 people in Fife, Scotland. As a child, Smith was clever and studious. 14 years old, admitted to Glasgow University, majoring in Latin, Greek, mathematics and moral philosophy. While studying in Glasgow University, Francis Hutcheson (1694- 1746), then a professor of philosophy, had a profound influence on Smith's liberalism.
During the period of 1740- 1746, Smith won a scholarship to study at Oxford University, but his name was not on the list of graduates of Oxford University. In the second chapter of The Wealth of Nations, Smith wrote: "Most professors in this university even gave up teaching principles completely in order to teach what they think is right." On one occasion, he was almost expelled from school because he found a david hume's theory of human nature in his room. The professor in the school thinks that even though Hume may become a philosopher in the future, it is not appropriate to read his books. Then they confiscated Smith's books and severely punished him. David hume is one of the most important figures in the history of Scottish Enlightenment and Western philosophy.
1746, Smith returned to his hometown of Kirkkadi from Oxford University. Two years later (1748), Smith began to be a lecturer at Edinburgh University, teaching English literature, and then began to teach economics. 175 1 year, Smith returned to his alma mater, Glasgow University, as a professor, teaching logic and moral philosophy. During his tenure at Glasgow University, Smith publicly expressed his views on economic liberalism and gradually formed his own economic views. At this time, Smith and Hume became close friends because of the spark of academic thought. They were totally involved in the research and never got married. This friendship lasted nearly 25 years and ended with Hume's death.
1759, Smith's first book, On Moral Sentiments, was published. This book caused a sensation immediately after its publication, and made Smith quickly rank among the top British philosophers. Moreover, the completion of this book laid a psychological foundation for the publication of The Wealth of Nations in the future.
In order to help Smith publicize his new book, Hume gave The Theory of Moral Sentiments to many friends, including the later British Chancellor of the Exchequer Charles Townsend (1725- 1767). 1755, Townsend married Caroline Campbell, the widow of the Duke of Bookruch and the mother of Henry Scott, the third Duke of Bookruch (1746- 18 12). After their marriage, Townsend hired adam smith as his stepson Henry Scott's tutor. Smith got the opportunity to study in Europe with Henry Scott, the little duke.
1764, Smith left Glasgow University to accompany the young duke to France. At this time, Hume worked in the British Embassy in France. On his recommendation, Smith visited Voltaire and other French celebrities. The experience of traveling and the contact with many scholars in continental Europe made Smith's economic theory mature, especially Fran? ois Quesnay (1694-1774), a physiocratic economist and one of the founders of classical political economy, had an important influence on Smith.
In order to summarize his economic research work, 1766, Smith returned to his hometown of Kirkkadi and began to devote himself to writing The Wealth of Nations.
1773, after writing in his hometown for many years, Smith felt that The Wealth of Nations had been basically completed, so he prepared to publish it in London with a manuscript. But when he arrived in London, he found that many new materials had been published in his secluded place in recent years, and he spent another three years supplementing and revising this book.
At that time, Smith was exhausted and extremely weak because of writing The Wealth of Nations. He was afraid that his nine-year-old works would not be published one day, so he entrusted his good friend Hume as the manuscript manager to handle all the manuscripts he left behind in the case of physical problems. 1March 776, The Wealth of Nations was published. Unfortunately, only five months later, Hume died of illness. Before Hume died, Adam Smith was appointed as his administrator in his will made in June 1776 1.
1784 On May 23rd, 90-year-old mother Margaret, who had been living alone with Adam Smith, passed away, and Smith was heartbroken. It was also from this year that his health continued to deteriorate.
1790 In July, Adam Smith died in Edinburgh. He left many unpublished works and declared in his will that some of them were not suitable for publication. The rest were later published, including papers on the history and philosophy of astronomy.
When France and Germany were still in the stage of naive feudal cottage industry and independent handicraft industry in the first half of18th century, Britain had entered the primary stage of capitalism through bourgeois revolution, and workshop handicraft industry had been widely developed in China.
In cottage industry and independent handicraft industry, workers are scattered in every household, and the individual is only an independent individual in the whole production process. However, the workshop handicraft industry is that many workers work in a factory, and under the arrangement of capitalists, they use simple tools to engage in division of labor.
The first industrial revolution from1860s to1940s was a great revolution in the whole history of human technological development, which opened an era in which machines replaced manual labor. The Wealth of Nations was published in the transition period from workshop handicraft industry to large machine industry. At this time, the industrial bourgeoisie and the industrial proletariat formed and grew, and Britain was in a critical period of transformation from commercial capital to industrial capital.
The Wealth of Nations summed up the experience of capitalist development in early modern times. On the basis of criticizing and absorbing the important economic theories at that time, it goes deep into the aspects of labor, division of labor, exchange, currency, commodity prices and the basic elements that constitute prices, and makes a detailed and incisive exposition, and gives a systematic and clear description of the whole process of national economic operation.
The Wealth of Nations is divided into five volumes. From the source of national wealth-labor, we talk about the division of labor, the means to improve labor productivity, the exchange generated by the division of labor, and the currency as the medium of exchange, and then discuss the price of goods and the components of the price-wages, land rent and profits.
The Wealth of Nations is based on the labor theory of value, with increasing national wealth as the main line and three kinds of income theories in three stages of capitalist society as the core. It systematically discusses the basic principles of the labor theory of value and emphasizes that labor is the source of wealth. It criticizes the concept of wealth of mercantilism and physiocracy, and points out that wealth is the total amount of goods produced by a country. There are two main ways to increase national wealth: the first way is the division of labor and the improvement of labor productivity; The second way is to increase the number of workers and accumulate capital.
For the first time, The Wealth of Nations correctly divided capitalist society into three classes: the bourgeoisie, the proletariat and the landlord class, and systematically analyzed three kinds of income: wages, profits and land rent. It correctly regards profits and land rent as the value created by workers' labor, that is, the deduction of the income earned by capitalists and landlords for nothing, describes the social and economic development process in Europe since the collapse of the Roman Empire, and studies the principles of national finance and taxation.
Smith's "The Wealth of Nations" also inherited his other book "On Moral Sentiments", holding that human nature is selfish and the pursuit of personal interests is the only motivation for everyone to engage in economic activities. At the same time, man is rational, so the saying of "rational man" in economics comes from this. As rational economic men, they can get the greatest personal benefits in their own economic activities. If this kind of economic activity is not disturbed, then under the guidance of the invisible hand of the price mechanism, people will not only maximize their personal interests, but also promote the promotion of the interests of the whole society.
The Wealth of Nations adapted to the social needs of opposing the mainstream thoughts of mercantilism and trade protectionism at that time, and advocated economic laissez-faire, free operation, free trade and making full use of the market mechanism of perfect competition. It is the first book to systematically expound the theory and policy of classical economic liberalism. Based on the theory of economic liberalism and the growth of national wealth, the book analyzes the economic philosophy (egoism and equilibrium theory), market mechanism theory (natural price theory), free trade theory (international division of labor theory) and state function theory, which played a very important role in the development of capitalist productive forces at that time. Therefore, western scholars call this masterpiece, which came out in the same year as the American Declaration of Independence, the Declaration of Industrial Freedom. At present, the economic liberalism based on it and the state interventionism caused by the so-called "Keynesian Revolution" are still two major ideological trends that affect western economic thoughts and policies, and also have important reference value for establishing a socialist market economic system.
Through the above sharing, I believe you have raised two questions at the beginning. What kind of book is The Wealth of Nations? What does "invisible hand" mean? "Have their own answers. Tomorrow, I will lead you to interpret the first article of "The Wealth of Nations", "The reasons for the improvement of labor productivity and the order of natural distribution of labor products among people of different classes", and share different reading feelings with you. Thank you for watching, we will come tomorrow!