EQUITY, BESIDES: ADAM SMITH AND THE UTILITY OF POVERTY

Generations of readers have nodded in agreement with Adam Smith’s argument, in Book One of the Wealth of Nations, that a nation cannot be happy if the workers who constitute the majority of its population are miserable. Smith notes that equity, besides, demands that workers receive a generous recomp...

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Bibliographic Details
Published inJournal of the History of Economic Thought Vol. 37; no. 4; pp. 559 - 581
Format Journal Article
LanguageEnglish
Published Abingdon Cambridge University Press 01.12.2015
Subjects
Economic history
Economic theory
Equity
Labor supply
Manual workers
Mercantilism
Poverty
Social order
Society
Wealth
Workers
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Summary:Generations of readers have nodded in agreement with Adam Smith’s argument, in Book One of the Wealth of Nations, that a nation cannot be happy if the workers who constitute the majority of its population are miserable. Smith notes that equity, besides, demands that workers receive a generous recompense for their labor. I contend that this famous statement is best interpreted in light of contemporary arguments that it was socially useful for workers to be poor. Smith’s engagement with these arguments is usually interpreted with reference to the labor supply function, but I argue that it also involved deeper suppositions about the place of workers in the social order. Smith’s reaction to these suppositions enriches our understanding of his contribution to liberal economics.
ISSN:0142-7716
DOI:10.1017/S1053837215000474