For Adam Smith, a crime is not the result of a rational calculation of loss and gain but the consequence of envy and a vain desire to parade wealth to attract the approbation of others, combined with ...a natural systematic bias in overestimating the probability of success. Similarly, Smith does not conceive of legal sanctions as a rational deterrent but as deriving from the feeling of resentment. While the prevailing approach of the eighteenth century is a rational explanation of crime and a utilitarian use of punishment, Adam Smith instead builds his theory of criminal behavior and legal prosecution consistently on the sentiments. A well-functioning legal system is thus an unintended consequence of our desire to bring justice to the individual person, not the result of a rational calculation to promote the public good, just like a well-functioning economic system is the unintended consequence of our desire to better our own condition, not the result of a rational calculation to promote public good.
We report data from laboratory experiments where participants were primed using phrases related to markets and trade. Participants then participated in trust games with anonymous strangers. The ...decisions of primed participants are compared to those of a control group. We find evidence that priming for market participation affects positively the beliefs regarding the trustworthiness of anonymous strangers and increases trusting decisions.
Abstract I suggest that Adam Smith’s ‘Digression on Silver’ should be read as his most powerful argument against mercantilism in the Wealth of Nations. For mercantilists money is wealth, according to ...Smith, and an increase in the quantity of silver, and the associated reduction in its value, implies higher prices in terms of silver. On the basis of this connection, mercantilists advocate trade protections to increase prices and therefore, in their view, wealth. Smith argues that this account obscures two processes occurring at the same time: a change in institutions that allows wealth to grow and leads to real prices decreasing, and a simultaneous increase in the quantity of silver leading to an increase in nominal prices. Overall, according to Smith, the nominal increase would be larger than the real decrease in prices. Mercantilists focused on nominal prices, attributing a causal relation between the decrease in the value of silver and an increase in wealth. Smith shows that correlation is not causation in this case, merely the coincidence of two simultaneous and independent processes. The Digression on Silver leaves mercantilists with nothing: what seems to be, is not what is. Money may seem to be wealth, but it is not: the ability to consume is.
Adam Smith allegedly offers a model of economic development in both his Lectures on Jurisprudence and the Wealth of Nations—the so-called four stages of development model. The model presents a linear ...unfolding view of economic development from primitive to advanced stages. But Smith’s own historical examples systematically contradict this model. I thus question whether Adam Smith actually endorses and uses the four stages model of development to illustrate development and suggest that if he does, he does it to discredit it instead. For Smith, history teaches that development is more accidental than fitting deterministic models.
In the second half of the nineteenth century, the Chilean free banking system worked similarly to how Adam Smith describes the eighteenth-century free banking system in Scotland. The characteristics ...of free banking that Smith identifies as conductive of successful outcomes—free entry, unlimited liability, and convertibility on demand—are present in both Scotland and Chile. And the Chilean system failed for similar reasons to the worries Smith had about the Scottish system: inconvertibility, legal tender, involvement with government borrowing, and lobbying. The Chilean experience of free banking appears to follow Smith's account of free banking.
Abstract
Is trade a promoter of peace? Adam Smith, one of the earliest defenders of trade, worries that commerce may instigate some perverse incentives, encouraging wars. The wealth that commerce ...generates decreases the relative cost of wars, increases the ability to finance wars through debts, which decreases their perceived cost, and increases the willingness of commercial interests to use wars to extend their markets, increasing the number and prolonging the length of wars. Smith, therefore, cannot assume that trade would yield a peaceful world. While defending and promoting trade, Smith warns us not to take peace for granted.
SMITH AT 300: THE DIGNITY OF TRADE Paganelli, Maria Pia
Journal of the History of Economic Thought,
06/2023, Letnik:
45, Številka:
2
Journal Article
Recenzirano
Odprti dostop
“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 necessities but of their advantages.” WN I.ii.2
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