Adam Smith on the Division of Labor

This is from An Inquiry into the Nature and Causes of the Wealth of Nations [1776] by Adam Smith (1723 – 1790), the great Scottish moral philosopher and the granddaddy of classical economics.

This division of labor, from which so many advantages are derived, is not originally the effect of any human wisdom, which foresees and intends that general opulence to which it gives occasion. It is the necessary, though very slow and gradual consequence of a certain propensity in human nature which has in view no such extensive utility: the propensity to truck, barter and exchange one thing for another.

The phrase “not originally the effect of any human wisdom” brings to mind the words of another Adam of the Scottish Enlightenment — Adam Ferguson. In his book An Essay on the History of Civil Society [1767], he wrote:

Every step and every movement of the multitude, even in what are termed enlightened ages, are made with equal blindness to the future; and nations stumble upon establishments, which are indeed the result of human action, but not the execution of any human design.

Engineering societies usually results in disaster because society is not some machine made of inanimate matter that can be designed and controlled. Society is a collective of individuals who act strategically for their own individual benefit. Order in such an organic system emerges spontaneously without anyone giving orders. Order without orders.

Author: Atanu Dey


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