Adam Smith is misinterpreted and his influence overstated https://www.economist.com/christmas-specials/2025/12/18/adam-smith-is-misinterpreted-and-his-influence-overstated From The Economist A great piece on Adam Smith by The Economist, using the 250th anniversary of his most famous book, An Inquiry into the Nature and Causes of the Wealth of Nations, as a leitmotif. “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.” In a striking article, it downplays the relative importance of what is actually mentioned in the book versus what has been widely attributed to it. It seems the invisible hand is not explicitly explained or applied to the pricing mechanism as we understand it today, but used in other contexts. Smith also introduces other concepts, such as the “impartial spectator”—an inner monologue or third-party perspective that judges our actions. However, it seems Smith occasionally gets economics “wrong,” for example in the labor theory of value or his discussion/partially support of the Navigation Acts, against free trade mechanisms (as he did acknowledge some secondary benefits, like the growth of the shipping industry). Nonetheless, although it does not seem like easy reading, the article has sparked my interest in finally tackling this book, as well as his earlier major work, The Theory of Moral Sentiments, both of which have been patiently waiting on my bookshelf. (text revise by a llm)
- Pedro
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