Adam Smith: An Inquiry Into the Nature and Causes of the Wealth of Nations
Adam Smith is broken up into five different books with separate chapters. We will mainly focus on book IV and I.Book I is mainly concerned with how wealth is distributed as wages, profits and rent. The main argument in book IV has do to with how government should not try to direct industry into export industry, or into agriculture, or in any particular direction, it should allow it to go in whatever direction private individuals find profitable.
The introduction starts off by stating that wealth consists of things consumed privately by individuals or families, however he did not think people were much happier being wealthy or not. Also, wealth depends on the productivity of labor and the level of employment as far as different classes are concerned, such as there is a leisure class and productive workers. A nation becomes wealthier because the nation has become more productive.
Book one discusses the causes and improvements in the productive powers of labor and how it's distributed. The causes of improvement become more naturally distributed among the ranks of people. There are two types of manufactures discussed, the trifling and the great. Trifling manufactures supply in a small scale to satisfy a small number of people and great manufactures supply in a large scale to satisfy a large number of people. The divisions of labor, increases productivity and but may decrease quality in that the person specializing in a part of a manufacturing process, can easily be replaced which lowers the skill involved. Main cause to the division of labor is a natural talent, different people have different talents, and one could specialize in philosophy while another can specialize in farming. The advantage to this is that people with these separate talents have the ability to trade produce with others of different talents or specializations.
On an economic stan…