Book IV of Adam Smith's Wealth of Nations concerns two rival economic theories, Mercantilism ... more Book IV of Adam Smith's Wealth of Nations concerns two rival economic theories, Mercantilism and Physiocracy. The latter, François Quesnay's system, occupies only the ninth and final chapter, and it begins with a stunning dismissal. Yet, fifteen pages later, Smith praises this theory to the skies. That cries out for explanation. Like Mercantilism, Smith's system emphasizes commerce, whereas Quesnay's is confined to agriculture. But like Physiocracy, Smith's system is built on individual liberty, whereas Mercantilism is one of government control. Despite his initial put-down, Smith is naturally inclined more toward Quesnay's philosophy. And the main thesis of my paper is to suggest one reason for this that has not previously been brought to light, and that can explain Smith's extravagant praise for it. Quesnay employs a Newtonian scientific method different from the one emphasized in Smith's early ‘Astronomy’ treatise, a method Smith first prominently ...
We have histories of the term ‘invisible hand’, but less on the idea, which goes back to a) ancie... more We have histories of the term ‘invisible hand’, but less on the idea, which goes back to a) ancient Taoism (the Tao does nothing, yet it is the Way by which all things are done); b) the Hippocratic philosophy, that physicians should remove the impediment and then let nature takes its course (think of Smith’s ‘unknown principle of animal life’, which ‘frequently restores health and vigour to the constitution’ (Wealth of Nations 343); c) common law, a product of human action but not of human design; John Herschel’s 19th-century concept of ‘consilience’ (‘when verifications [of a theory] spring up… spontaneously…from quarters where they might be least expected…evidence of this kind is irresistible’); and the late-20th-century science of ‘self-organization’.
Book IV of Adam Smith's Wealth of Nations concerns two rival economic theories, Mercantilism and ... more Book IV of Adam Smith's Wealth of Nations concerns two rival economic theories, Mercantilism and Physiocracy. The latter, François Quesnay's system, occupies only the ninth and final chapter, and it begins with a stunning dismissal. Yet, fifteen pages later, Smith praises this theory to the skies. That cries out for explanation; and the main thesis of my paper is to suggest one reason for this that has not been brought to light.
ABSTRACT
Smith scholars are well aware of his admiration for Newton’s achievement in connecting t... more ABSTRACT Smith scholars are well aware of his admiration for Newton’s achievement in connecting the most disparate phenomena via the single principle of gravitation. And they are well aware of his description of “the natural price” in Wealth of Nations as “the central price, to which the prices of all commodities are continually gravitating.” What goes unnoticed is that these involve two different methods. The latter goes back to Archimedes, and even to Socrates, and forward to Milton Friedman’s landmark 1953 paper on methodology in economics. Recently Leonidas Montes and Eric Schliesser have brought out a third Newtonian method present in Smith’s work. But I argue that both it and the method of connectivity in Smith’s early “Astronomy” treatise can be subsumed under the more foundational Galilean-Newtonian method of approximation to an ideal limit.
Book IV of Adam Smith's Wealth of Nations concerns two rival economic theories, Mercantilism ... more Book IV of Adam Smith's Wealth of Nations concerns two rival economic theories, Mercantilism and Physiocracy. The latter, François Quesnay's system, occupies only the ninth and final chapter, and it begins with a stunning dismissal. Yet, fifteen pages later, Smith praises this theory to the skies. That cries out for explanation. Like Mercantilism, Smith's system emphasizes commerce, whereas Quesnay's is confined to agriculture. But like Physiocracy, Smith's system is built on individual liberty, whereas Mercantilism is one of government control. Despite his initial put-down, Smith is naturally inclined more toward Quesnay's philosophy. And the main thesis of my paper is to suggest one reason for this that has not previously been brought to light, and that can explain Smith's extravagant praise for it. Quesnay employs a Newtonian scientific method different from the one emphasized in Smith's early ‘Astronomy’ treatise, a method Smith first prominently ...
We have histories of the term ‘invisible hand’, but less on the idea, which goes back to a) ancie... more We have histories of the term ‘invisible hand’, but less on the idea, which goes back to a) ancient Taoism (the Tao does nothing, yet it is the Way by which all things are done); b) the Hippocratic philosophy, that physicians should remove the impediment and then let nature takes its course (think of Smith’s ‘unknown principle of animal life’, which ‘frequently restores health and vigour to the constitution’ (Wealth of Nations 343); c) common law, a product of human action but not of human design; John Herschel’s 19th-century concept of ‘consilience’ (‘when verifications [of a theory] spring up… spontaneously…from quarters where they might be least expected…evidence of this kind is irresistible’); and the late-20th-century science of ‘self-organization’.
Book IV of Adam Smith's Wealth of Nations concerns two rival economic theories, Mercantilism and ... more Book IV of Adam Smith's Wealth of Nations concerns two rival economic theories, Mercantilism and Physiocracy. The latter, François Quesnay's system, occupies only the ninth and final chapter, and it begins with a stunning dismissal. Yet, fifteen pages later, Smith praises this theory to the skies. That cries out for explanation; and the main thesis of my paper is to suggest one reason for this that has not been brought to light.
ABSTRACT
Smith scholars are well aware of his admiration for Newton’s achievement in connecting t... more ABSTRACT Smith scholars are well aware of his admiration for Newton’s achievement in connecting the most disparate phenomena via the single principle of gravitation. And they are well aware of his description of “the natural price” in Wealth of Nations as “the central price, to which the prices of all commodities are continually gravitating.” What goes unnoticed is that these involve two different methods. The latter goes back to Archimedes, and even to Socrates, and forward to Milton Friedman’s landmark 1953 paper on methodology in economics. Recently Leonidas Montes and Eric Schliesser have brought out a third Newtonian method present in Smith’s work. But I argue that both it and the method of connectivity in Smith’s early “Astronomy” treatise can be subsumed under the more foundational Galilean-Newtonian method of approximation to an ideal limit.
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Smith scholars are well aware of his admiration for Newton’s achievement in connecting the most disparate phenomena via the single principle of gravitation. And they are well aware of his description of “the natural price” in Wealth of Nations as “the central price, to which the prices of all commodities are continually gravitating.” What goes unnoticed is that these involve two different methods. The latter goes back to Archimedes, and even to Socrates, and forward to Milton Friedman’s landmark 1953 paper on methodology in economics. Recently Leonidas Montes and Eric Schliesser have brought out a third Newtonian method present in Smith’s work. But I argue that both it and the method of connectivity in Smith’s early “Astronomy” treatise can be subsumed under the more foundational Galilean-Newtonian method of approximation to an ideal limit.
Smith scholars are well aware of his admiration for Newton’s achievement in connecting the most disparate phenomena via the single principle of gravitation. And they are well aware of his description of “the natural price” in Wealth of Nations as “the central price, to which the prices of all commodities are continually gravitating.” What goes unnoticed is that these involve two different methods. The latter goes back to Archimedes, and even to Socrates, and forward to Milton Friedman’s landmark 1953 paper on methodology in economics. Recently Leonidas Montes and Eric Schliesser have brought out a third Newtonian method present in Smith’s work. But I argue that both it and the method of connectivity in Smith’s early “Astronomy” treatise can be subsumed under the more foundational Galilean-Newtonian method of approximation to an ideal limit.