How To Properly Appreciate Adam Smith

In this podcast, Sam Leith interviews Jesse Norman, MP and the author of a new book, Adam Smith: What he Thought and Why it Matters. 

Norman seeks to understand Smith as an Enlightenment thinker, rather than as a talisman for modern economics or free markets. To this end, he places Smith's Wealth of Nations in the context of his earlier work, the Theory of Moral Sentiments. This interpretation is consistent with recent scholarship, which focuses more and more on Smith's earlier work, and sets aside the notion that there is any conflict between the two books. 

Indeed, as Norman argues, though the Theory of Moral Sentiments is a book of moral psychology and the Wealth of Nations a book of political economy, they are based on a single, unitary, philosophical approach to studying human society. 

The core idea in both books is the idea of exchange. For Smith, we form our view of the world through exchanging ideas with each other. And we form our moral sentiments by trying to imagine ourselves in the positions of others. Similarly, in order to engage in trade, we have to imagine ourselves in the position of someone else in order to envision what they would wish to buy. Trade, Smith argued, was a uniquely human activity.  

Returning to read Smith this way, Norman argues, gives us new insights into modern economics. The Smith he presents anticipates many of the more novel ideas in economics such as positional goods and behavioral economics. 

The podcast ranges across 18th century Scotland and England and explores the details of his life, including his relationships with David Hume, Edmund Burke, and Dr. Johnson. It is full of witty asides, of which my favorite is Hume's refusal of his publisher's requests for further volumes of the History of England on the grounds that he was now “too old, too fat, too lazy, and too rich.”