Adam Smith, Lectures On Jurisprudence, ed. R.. L. Meek, D. D. Raphael and P. G. Stein, vol. V of the Glasgow Edition of the Works and Correspondence of Adam Smith (Indianapolis: Liberty Fund, 1982). Chapter: | Wednesday. March. 30. 1763.
Adam Smith, Lectures On Jurisprudence, ed. R.. L. Meek, D. D. Raphael and P. G. Stein, vol. V of the Glasgow Edition of the Works and Correspondence of Adam Smith (Indianapolis: Liberty Fund, 1982). Chapter: Of Police.
Under the third heading, the history of commerce, or the causes of the slow progress of opulence, Adam Smith dealt with 'first, natural impediments, and secondly, the oppression of civil government'. He is not recorded to have mentioned any natural impediments except the absence of division of labour in rude and barbarous times owing to the want of stock. But on the oppression of civil government he had much to say. At first governments were so feeble that they could not offer their subjects that security without which no man has any motive to be industrious. Afterwards, when governments became powerful enough to give internal security, they fought among themselves, and their subjects were harried by foreign enemies. Agriculture was hindered by great tracts of land being thrown into the hands of single persons. This led at first to cultivation by slaves, who had no motive to industry; then came tenants by steelbow (metayers) who had no sufficient inducement to improve the land; finally the present method of cultivation by tenants was introduced, but these for a long time were insecure in their holdings, and had to pay rent in kind, which made them liable to be severely affected by bad seasons. Feudal subsidies discouraged industry, the law of primogeniture, entails, and the expense of transferring land prevented the large estates from being divided. The restrictions on the export of corn helped to stop the progress of agriculture. Progress in arts and commerce was also hindered by slavery, as well as by the ancient contempt for industry and commerce, by the want of enforcement of contracts, by the various difficulties and dangers of transport, by the establishment of fairs, markets and staple towns, by duties on imports and exports, and by monopolies, corporation privileges, the statute of apprenticeship and bounties.
In 1751 Smith Was appointed the Chair of Logic at University of Glasgow, the next year he was appointed the Chair of Moral Philosophy, which was the position of his old teacher Francis Hutcheson....
She commented “Adam Smith, in fact, heralded the end of the strait-jacket of feudalism and released all the innate energy of private initiative and enterprise which enable wealth to be created on a scale never before contemplated” (Copley and Sut...
The difficulty with which labour is transferred from one occupation to another is the principal evil of a high state of civilization. It exists in proportion to the division of labour. In a savage state almost every man is equally fit to exercise, and in fact does exercise, almost every employment. But in the progress of improvement two circumstances combine to render narrower and narrower the field within which a given individual can be profitably employed. In the first place the operations in which he is engaged become fewer and fewer. "In a pin-manufactory," says Adam Smith, "one man draws out the wire, another straightens it, a third cuts it, a fourth points it, a fifth grinds it at the top for receiving the head; to make the head requires two or three distinct operations; to put it on is a peculiar business; to whiten the pins is another; it is even a trade by itself to put them into the paper; and the important business of making a pin is in this manner divided into about eighteen distinct operations." In a large manufactory the man who is engaged in one of these operations has little experience in any of the others.
Experience shows that a general belief in the beneficence of the economic working of self-interest is not always sufficient to make even a person of more than average intelligence a free-trader. Consequently it would be rash to suppose that Smith's disbelief in the mercantile system was merely the natural outcome of his general belief in economic freedom. Dugald Stewart's quotations from his paper of 1755 do not contain anything to show that he was pouring contempt on the doctrine before he left Edinburgh and in his early years at Glasgow. It seems very likely that the reference in the lectures to Hume's 'essays showing the absurdity of these and other such doctrines' is to be regarded as an acknowledgment of obligation, and therefore that it was Hume, by his on Money and the Balance of Trade in 1752, who first opened Adam Smith's eyes on this subject. The probability of this is slightly increased by the fact that in the lectures the mercantile fallacies as to the balance of trade were discussed in connexion with Money, as in Hume's instead of in the position which they would have occupied if Smith had either followed Hutcheson's order, or placed them among the causes of the 'slow progress of opulence'. It is, too, perhaps, not a mere coincidence that while both Hume in the in 1752 and Smith in his lectures ten years later rejected altogether the aim of securing a favourable balance of trade, Hume still clearly believed in the utility of protection for home industries, and Smith is at any rate reported to have made a considerable concession in its favour.
§ 4. [The higher degrees of the division of labour] Thus far of the separation of employments, a form of the combination of labour without which there cannot be the first rudiments of industrial civilization. But when this separation is thoroughly established; when it has become the general practice for each producer to supply many others with one commodity, and to be supplied by others with most of the things which he consumes; reasons not less real, though less imperative, invite to a further extension of the same principle. It is found that the productive power of labour is increased by carrying the separation further and further; by breaking down more and more every process of industry into parts, so that each labourer shall confine himself to an ever smaller number of simple operations. And thus, in time, arise those remarkable cases of what is called the division of labour, with which all readers on subjects of this nature are familiar. Adam Smith's illustration from pin-making, though so well known, is so much to the point, that I will venture once more to transcribe it. "The business of making a pin is divided into about eighteen distinct operations. a One man draws out the wire, another straights it, a third cuts it, a fourth points it, a fifth grinds it at the top for receiving the head; to make the head requires two or three distinct operations; to put it on, is a peculiar business; to whiten the pins is another; it is even a trade by itself to put them into the paper. . . . . I have seen a small manufactory where ten men only were employed, and where some of them, consequently, performed two or three distinct operations. But though they were very poor, and therefore but indifferently accommodated with the necessary machinery, they could, when they exerted themselves, make among them about twelve pounds of pins in a day. There are in a pound upwards of four thousand pins of a middling size. Those ten persons, therefore, could make among them upwards of forty-eight thousand pins in a day. Each person, therefore, making a tenth part of forty-eight thousand pins, might be considered as making four thousand eight hundred pins in a day. But if they had all wrought separately and independently, and without any of them having been educated to this peculiar business, they certainly could not each of them have made twenty, perhaps not one pin in a day."
If we bear in mind Smith's criticism of Hutcheson and Mandeville in adjoining chapters of the and remember further that he must almost certainly have become acquainted with the when attending Hutcheson's lectures or soon afterwards, we can scarcely fail to suspect that it was Mandeville who first made him realise that 'it is not from the benevolence of the butcher, the brewer or the baker that we expect our dinner, but from their regard to their own interest'. Treating the word 'vice' as a mistake for self-love, Adam Smith could have repeated with cordiality Mandeville's lines already quoted:
[Mill's chapter on "Co-operation, or the Combination of Labour" is in many respects an extended commentary on Smith. In this pasage Mill is concerned about the problem of OVER production. He wonders what will happen if the extraordinary productivity made possible by the division of labour results in unsold goods because the market is too limited to purchase it all. His answer is that commercial liberty applied to the entire world market will help manufacturers find outlets for the products.]