Thursday, October 2, 2014

What general message is set forth in Adam Smith's book, The Wealth of Nations?

The major point of this book is that government should
stay out of economics for the most part.  The book argues that there is an "invisible
hand" that will lead to a strong economy if the government will stay out of the
way.


At the time when Smith was writing, governments were
deeply involved in economies.  In particular, governments practiced mercantilism -- a
system which strictly restricted trade.  Governments believed that regulations like
these were the way to increase a nation's wealth.


Smith
argued, by contrast, that wealth increased when businesses were free to do as they
wished -- when trade was unimpeded, for example.


Smith's
name is connected with the idea of laissez-faire capitalism because of the message of
this book -- that government should stay out of the economy.

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