Adam Smith

Smith, Adam (1723–90), Scottish economist and philosopher. The free-market system he advocated in Inquiry into the Nature and Causes of the Wealth of Nations (1776) came to be regarded as the classic system of economics. Smith drew on the ideas of his friends D. Hume, A. R. Turgot, F. Quesnay, and C. Montesquieu, and argued that if market forces were allowed to operate without state intervention “an invisible hand” would guide self-interest for the well-being of all. His concept of the division of labor and the belief that value derives from productive labor were major insights. An earlier work, Theory of Moral Sentiments (1759), contrasts with The Wealth of Nations in its emphasis upon sympathy rather than self-interest as a basic force in human nature.

See also: Economics.