Wealth Of Nations Adam Smith Analysis

Adam Smith has come to be regarded as one of the fathers of economics. He is most known for the profound ideas and novel theories on capitalism presented in his book Wealth of Nations. Some ten years prior the release of that book, he completed his Theory of Moral Sentiments, lesser known and less referred to in relation to political economics, but equally as important. Both books, however, must be read together to have a deeper understanding of Smith’s economic theories and his understanding of humans as social beings.
Smith is concerned with psychology and economics and manages to weave them together throughout both books. He uses Theory of Moral Sentiments to discuss human psychology and to explain what he believes makes a healthy society. …show more content…
In Wealth of Nations the ideal capitalist government and society relies on man being prudent and those assumptions and descriptions of the prudent man are seen throughout Wealth of Nations. The prudent man is what Smith assumes makes a capitalist government successful and have a path of steady, but not rapid growth. The prudent man is a fundamental part of Smith’s work and truly describes what Smith feels makes a successful society and economy. The prudent man in context lives within his income, does not cheat or lie to get ahead of his neighbors, he is sincere and honest, is not a risk taker, and has no anxiety to change. This concept seems right and it seems to make sense, but looking at our society today it is very different. Although we still believe in the same high morals, we also have a need for rapid change and taking risks. Most Americans are constantly looking to improve their situation financially. They look for new ways to make money and seek new exciting, yet often risky business ventures. It would be interesting to see what Smith would say about our government and society structure today and how it encourages individual economic growth and materialistic wants and also having massive government debt. This makes me believe that he emphasized prudence for a reason and that he believes it is the foundation for both a successful society and economy. Although what is now considered the American Dream might not fit Smith’s ideal for an economy and society, I believe Smith would feel America could benefit from a more prudent lifestyle and would be capable of transitioning into a more prudent lifestyle because the effects of prudence are what we naturally desire, such as feeling moral and receiving worthy praise for our hard