Kirkcaldy, Glasgow, Oxford
Adam Smith was born in 1723 in Kirkcaldy, a Scottish port town, months after his father's death; an early biographer records that gypsies briefly carried off the toddler, history's least successful kidnapping. At fourteen he entered Glasgow University, where the lectures of Francis Hutcheson lit his interest in moral philosophy, and at seventeen he went to Oxford on a scholarship. He found Balliol idle and its teachers unteaching, an experience that later sharpened his argument that institutions respond to incentives: Oxford dons, paid regardless, did not bother.
Back in Scotland he lectured in Edinburgh, befriended David Hume, the philosopher who remained his closest intellectual companion, and in 1752 took the Glasgow chair of moral philosophy. His first masterpiece, The Theory of Moral Sentiments of 1759, asked how selfish creatures manage to be decent. His answer was sympathy: we constantly imagine ourselves into other breasts, and we judge our own conduct through an imagined impartial spectator. Whatever later readers made of him, Smith's system began not with self-interest but with fellow feeling.
An Inquiry into Wealth
A lucrative post tutoring the young Duke of Buccleuch took Smith to France, where he met Voltaire, Quesnay, and Turgot, and began, out of boredom in Toulouse, a book to pass the time. Twelve years later, in March 1776, An Inquiry into the Nature and Causes of the Wealth of Nations appeared. Its famous opening dissects a pin factory, showing how the division of labor multiplies output; its larger argument holds that prosperity grows from exchange and specialization, not from hoarded gold, and that the mercantile system rigged trade for the few.
The book is angrier than its reputation. Smith warned that merchants of the same trade seldom meet without the conversation turning against the public; he denounced the East India Company, doubted the empire was worth its cost, and sided with laborers against masters who combined secretly to hold wages down. The phrase invisible hand appears exactly once in the book. He also saw the human price of his pin factory, warning that endless repetition could render workers as stupid as it is possible for a human creature to become, and urged public schooling as the remedy.
The Legacy Everyone Claims
Smith ended his career, with some irony, as a commissioner of customs in Edinburgh, enforcing the tariffs his book had undermined, and he gave away much of his income in private charity. He never married, lived with his mother, and before dying in 1790 had friends burn nearly all his manuscripts, leaving two books to speak for him. The Wealth of Nations shaped British policy within a generation, and every economic faction since has claimed him: free traders and regulators, conservatives and social democrats, each quoting selectively.
Modern scholarship has largely rescued Smith from the caricature of laissez-faire mascot. He favored banking regulation after Scotland's credit crises, progressive-leaning taxation, and public works the market would not supply, and his two books form one project: markets sit inside morals, not the other way around. His blind spots were real, including his era's complacency about slavery in practice despite condemning it in print as both cruel and inefficient. The economist on the twenty-pound note remains what he was in life: a moral philosopher first.
