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AN

I N Q u I R Y

INTO THE

Nature and Caufes

OF THE

WEALTH OF NATIONS.

By ADAM SMITH, LL.D. and F.R.S. Formerly Pro/eft'orof Moral Phdofophyin the Univer_tyof GLASOOW.

IN TWO VOLUMES.

VOL. I.

LONDON:

PRINTED FOR W. ST_AHAN_ AND T.¢ADELL_ INTHE _TRAND.

MDCCLXXVI,

CONTENTS

Introduction and Plan of the Work io

I BOOK I

Of the Causes of Improvement in the productive Powers of Labour, and of the Order according to which its Produce is naturally distributed among the different Ranks of the People

I.i CHAPTER I Of the Division of Labour i3

I.ii CHAPTER II Of the Principle which gives occasion to the Lh'v,_ionof Labour 25

I.iii CHAPTER III That the Divim'on of Labour is limited by the Extent of the Market 3t

I.iv CHAPTER IV

Of the Odgin and Use of Money 37 I.v CHAPTER V

Of the real and nominal Price of Commodities, or of their Price in Labour, and their Price in Money 47

I.vi CHAPTER VI Of the component Parts of the Price of Commodities 65

I.vii CHAPTER VII

Of the natural and market Price of Commodities 72 I.viii CHAPTER VIII

Of the Wages of Labour 82 I.ix CHAPTER IX

Of the Profits of Stock ,05 I.x CHAPTER X I.x.a Of Wages and Profit in the different Employments of Labour and

S¢od_ xi6

I.x.b Part I. Inequalities arin'ng from the Nature of the Employments themselves i x6

I.x.c Part II. Inequah'ties occasionedby the Policy of Europe x35 I.xi CHAPTER XI

I.xi.a Of the Rent of Land i6o I.xi.b Part I. Of the Produce of Land which always affords Rent ,62

[6] BOOK I

Of the Causes of Improvement in the productive Powers of Labour, and of the Order according to which its Produce is naturally distributed among the different Ranks of the People

CHAPTER I

Of the Division of Labour

i THE greatest aimprovementa in the productive powers of labour, and the greater part of the skill, dexterity, and judgment with which it is any where directed, or applied, seem to have been the effects of the division of labour. 1 a-_ improvements z

I The first considered exposition of the term division of labour by a modern writer was probably by Sir William Petty: 'Those who have the command of the Sea Trade, may Work at easier Freight with more profit, than others at greater: for as Cloth must be cheaper made, when one Cards, another Spins, another Weaves, another Draws, another Dresses, another Presses and Packs; than when all the Operations above-men- tioned, were clumsily performed by the same hand; so those who command the Trade of Shipping, can build long slight Ships for carrying Masts, Fir-Timber, Boards, Balks, etc.' (Political Arithmetick (London, x69o), x9, in C. H. Hull, The Economic Writings of Sir William Petty (Cambridge, I899), i. 260). 'For in so vast a City Manufactures will beget one another, and each Manufacture will be divided into as many parts as possible, whereby the work of each Artisan will be simple and easie: As for Example. In the making of a Watch, If one Man shall make the Wheels, another the Spring, another shall Engrave the Dial-plate, and another shall make the Cases, then the Watch will be better and cheaper, than if the whole Work be put upon any one Man.' (Another Essay in Political Arithmetick, concerning the Gror_th of the City of London (London, x683), 36--7, in C. H. Hull, ii.473. ) Later use was by Mandeville and Harris: 'There are many Sets of Hands in the Nation,

that, not wanting proper Materials, would be able in less than half a Year to produce, fit out, and navigate a First-Rate [Man of War]: yet it is certain, that this Task would be impracticable, if it was not divided and subdivided into a great Variety of different Labours; and it is as certain, that none of these Labours require any other, than working Men of ordinary Capacities.' (B. Mandeville, The Fable of the Bees, pt. ii.x49, ed. F. B. Kaye (Oxford, I924), ii.142.) 'No number of Men, when once they enjoy Quiet, and no Man needs to fear his Neighbour, will be long without learning to divide and subdivide their Labour.' (Ibid., pt. ii.335, ed. Kaye ii.284.) 'The advantages accruing to mankind from their betaking themselves severally to different occupations, are very great and

14 The Nature and Causes of [I.i

z The effects of the division of labour, in the general business of society, will be more easily understood, by considering in what manner it operates in some particular manufactures. It is commonly supposed to be carried i furthest in some very trifling ones; not perhaps that it really is carried further in them than in others of more importance: but in those trifling manufactures which are destined to supply the small wants of but a small number of people, the whole number of workmen must necessarily be small; and those employed in every different branch of the work can often be collected into the same [7] workhouse, and placed at once under the view of the spectator. In those great manufactures, on the contrary, which are _- destined to supply the great wants of the great body of the people, every different branch of the work employs so great a number of workmen, that it is impossible to collect them all into the same workhouse. We can seldom b see more, at one time, than those employed in one single branch. Though [ bin such manufactures, b therefore, the work may really be divided into a r much greater number of parts, than in those of a more trifling nature, the division is not near so obvious, and has accordingly been much less ob- served.

3 To take an example, therefore, from a very trifling manufacture; but one in which the division of labour has been very often taken notice of, the trade of the pin-maker; a workman not educated to this business (which the division of labour has rendered a distinct trade), nor acquainted with the use of the machinery employed in it (to the invention of which the same division of labour has probably given occasion), could scarce, perhaps, with his utmost industry, make one pin in a day, and certainly could not make twenty. 2 But in the way in which this business is now carried on, not only the whole work is a peculiar trade, but it is divided into a number of branches, of which the greater part are likewise peculiar

b-bin them I

obvious: For thereby, each becoming expert and skilful in his own particular art; they are enabled to furnish one another with the products of their respective labours, performed in a much better manner, and with much less toil, than any one of them could do of himself.' CI.Harris, An Essay upon Money and Coins.(London, I757), i. 16.) The advantages of the division of labour are also emphasized by Turgot in sections

III and IV of his Reflections on the Formation and Distribution of Riches (x766). The translation used is by R. L. Meek and included in his Turgot on Progress, Sociology and Economics (Cambridge, I973). 2 Cf. ED z.4: 'to give a very frivolous instance, if a11the parts of a pin were to be

made by one man, if the same person was to dig the metall out of the mine, seperate it from the ore, forge it, split it into small rods, then spin these rods into wire, and last of all make that wire into pins, a man perhaps could with his utmost industry scarce make a pin in a year.' Smith added that even where the wire alone was furnished an unskilled man could probably make only about zo pins a day. Similar examples occur in LJ (A) vi.z9-3o and LJ (B) zI3-x4, ed. Carman I63. It is remarked in LJ (A) vi.5o that the wire used in pin manufacture generally came from Sweden.

I.i] the Wealth of Nations I5

trades. 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 [8] 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, 3 which, in some manufactories, are all performed by distinct hands, though in others the same man will sometimes perform two or three of them. I have seen a small manufactory of this kind where ten men only were em- ployed, 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.4 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, there- fore, 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; that is, certainly, not the two hundred and fortieth, perhaps not the four thousand eight hundredth part of what they are at present capable of performing, in con- sequence of [9] a proper division and combination of their different opera- tions.

4 In every other art and manufacture, the effects of the division of labour are similar to what they are in this very trifling one; though, in many of them, the labour can neither be so much subdivided, nor reduced to so great a simplicity of operation. The division of labour, however, so far as it can be introduced, occasions, in every art, a proportionable increase of the productive powers of labour. The separation of different trades and employments from one another, seems to have taken place, in con- sequence of this advantage. This separation too is generally carried furthest in those countries which enjoy the highest degree of industry and improve- ment; what is the work of one man, in a rude state of society, being gener- ally that of several in an improved one. In every improved society, the

aEighteen operations are described in the Encyclopidie (I755), v.8o4-7. See also Chambers'Cyclopaedia(4th ed. I74x), s.v. Pin. 4A very similarpassage occurs in ED z.4 which also concludesthat where the pro-

cessesof manufacture are dividedamong I8 persons, each should in effect be capable of producing2,ooopins in a day.These figuresarealso cited in LJ (A) vi.3oand 5I and LJ (13)-zx4,ed. Carmanx63. In referringto the disadvantagesof the divisionof labourin LJ (B) 329, ed. Carman255, the lecturermentions the exampleof a person engagedon the xTthpart of a pin or the 8oth part of abutton. See below,V.i.f.5o.

x6 The Nature and Causes of [I.i

farmer is generally nothing but a farmer; the manufacturer, nothing but a manufacturer,s The labour too which is necessary to produce any one complete manufacture, is almost always divided among a great number of hands. How many different trades are employed in each branch of the linen and woollen manufactures, from the growers of the flax and the wool, to the bleachers and smoothers of the linen, or to the dyers and dressers of the cloth[ The nature of agriculture, indeed, does not admit of so many subdivisions of labour, nor of so complete a separation of one business from another, as manufactures.6 It is impossible to separate so entirely, the business of [io] the grazier from that of the corn-farmer, as the trade of the carpenter is commonly separated from that of the smith. The spinner is almost always a distinct person from the weaver; but the ploughman, the harrower, the sower of the seed, and the reaper of the corn, areoften the same.7The occasions for those different sorts of labour returning with the different seasons of the year, it is impossible that one man should be constantly employed in any one of them. This impossi- bility of m_ing so complete and entire a separation of all the different branches of labour employed in agriculture, is perhaps the reason why the improvement of the productive powers of labour in this art, does not always keep pace with their improvement in manufactures. The most opulent nations, indeed, generally excel all their neighbours in agri- culture as well as in manufactures; but they are commonly more distin- guished by their superiority in the latter than in the former,s Their lands are in general better cultivated, and having more labour and expence bestowed upon them, produce more, in proportion to the extent and natural fertility of the ground. But cthiscsuperiority of produce is seldom much more than in proportion to the superiority of labour and expence. In agriculture, the labour of the rich country is not always much more productive than that of the poor; or, at least, it is never so much more productive, as it commonly is in manufactures. The corn of the rich country, therefore, will not always, in the same degree of goodness, come cheaper to [ix] market than that of the poor. The corn of Poland, in the same degree of goodness, is as cheap as that of France, notwithstanding o--othex

s See below, I.x.b.5a. The same point is made at IV.ix.35. The limitation imposed on the division of labour

in agriculture is stated to require greater knowledge on the part of the workman at I.x.c.z4. At the same time, agriculture was regarded by Smith as the most productive form of investment, II.v.I2. ' LJ (A) vi.3o-x comments that: 'Agriculture however does not admit of this separa-

tion of employment in the same degree as the manufactures of wool or lint or iron work. The same man must often be the plougher of the land, sower, harrower, reaper and thresher of the corn (tho' here there may be some distinctions.)' Similar points are made in L| (]3) zI4, ed. Carman x64, s The two preceding sentences follow the text of ED 2.5 very closely.

I.i] the Wealth of Nations x7

the superior opulence and improvement of the latter country. The corn of France is, in the corn provinces, fully as good, and in most years nearly about the same price with the corn of England, though, in opulence and improvement, France is perhaps inferior to England. The acorn-landsa of England, however, are better cultivated than those of France, and the ecorn-lands e of France are said to be much better cultivated than those of Poland. But though the poor country, notwithstanding the inferiority of its cultivation, can, in some measure, rival the rich in the cheapness and goodness of its corn, it can pretend to no such competition in its manufactures; at least if those manufactures suit the soil, climate, and situation of the rich country. The silks of France are better and cheaper than those of England, because the silk manufacture, _at least under the present high duties upon the importation of raw silk/does not gsowelP suit the climate of England has that of France. n But the hard-ware and the coarse woollens of England are beyond all comparison superior to those of France, and much cheaper too in the same degree of goodness. 9 In Poland there are said to be scarce any manufactures of any kind, a few of those coarser household manufactures excepted, without which no country can well subsist.

5 This great increase _of_ the quantity of work, which, fin consequence of the division of labour, j [iz] the same number of people are capable of performing, k is owing to three different circumstances; first, to the increase of dexterity in every particular workman; secondly, to the saving of the time which is commonly lost in passing from one species of work to another; and lastly, to the invention of a great number of machines which facilitate and abridge labour, and enable one man to do the work of many.1°

6 First, the improvement of the dexterity of the workman necessarily lands x _-_lands x t-I z-6 .-* z-6 h-hZ--6 *-Iin 6

J-_Z--6 _ in consequence of the division of labour, z

9 ED 2.5 ends with the statement that: 'The corn of France is fully as good and in the provinces where it grows rather cheaper than that of England, at least during ordinary seasons. But the toys of England, their watches, their cutlery ware, their locks & hinges of doors, their buckles and buttons are in accuracy, solidity, and perfection of work out of all comparison superior to those of France, and cheaper too in the same degree of goodness.' A precis of this argument appears in LJ (A) vi.3t-z, and LJ (B) _14, ed. Carman x64; and see below, I.xi.o.4, where Smith states that manufactures which use the coarser metals have probably the greatest scope for the division of labour. ED 2.6 and 7 are omitted from the WN. In these passages Smith elaborated on the

advantages of the division of labour in pin making and added that these advantages were such as to suggest that any rich country which faced a loss of markets in international trade to a poor one 'must have been guilty of some great error in its police.' There is no corresponding passage in LJ (B), but a similar argument occurs in LJ (A) vi.34. toThis paragraph is evidently based on ED 2.8. Similar points appear in LJ (A)

vi.38; LJ (B) zzS-16, ed. Carman i66. The_advantages are also cited in the Encyclopedic (x755), i.7x3-17.

x8 The Nature and Causes of [I.i

increases the quantity of the work he can perform, and the division of labour, by reducing every man's business to some one simple operation, and by making this operation the sole employment of his life, necessarily increases very much the dexterity of the workman. A common smith, who, though accustomed to handle the hammer, has never been used to make nails, if upon some particular occasion he is obliged to attempt it, will scarce, I am assured, be able to make above two or three hundred nails in a day, and those too very bad ones. A smith who has been accus- tomed to make nails, but whose sole or principal business has not been that of a nailer, can seldom witlx his utmost diligence make more than eight hundred or a thousand nails in a day. I have seen several boys under twenty years of age who had never exercised any other trade but that of making nails, and who, when they exerted themselves, could make, each of them, upwards of two thousand three hundred nails in a day. The making of a nail, however, is by no means one [I3] of the simplest opera- tions. The same person blows the bellows, stirs or mends the fire as there is occasion, heats the iron, and forges every part of the nail: In forging the head too he is obliged to change his tools. The different operations into which the making of a pin, or of a metal button, is subdivided, are all of them much more simple, and the dexterity of the person, of whose life it has been the sole business to perform them, is usually much greater. The rapidity with which some of the operations of those manufactures are performed, exceeds what the human hand could, by those who had never seen them, be supposed capable of acquiring./1

7 Secondly, the advantage which is gained by saving the time commonly lost in passing from one sort of work to another, is much greater than we should at first view be apt to imagine it. It is impossible to pass very quickly from one kind of work to another, that is carried on in a different place, and with quite different tools. A country weaver, who cultivates a small farm, must lose a good deal of time in passing from his loom to the field, and from the field to his loom. When the two trades can it This whole paragraph follows ED z.9, save that the boy is there said to have been

x9 years old. A similar argument occurs in LJ (A) vi.38, where a nailsmith of z5 is said to be capable of producing 3,ooo-4,ooo nails in a day. See also LJ (B) zI6, ed. Cannan t66:

A country smith not accustomed to make nails will work very hard for 3 or 4oo a day, and these too very bad. But a boy used to it will easily make zooo and these incompar- ably better; yet the improvement of dexterity in this very complex manufacture can never be equal to that in others. A nail-maker changes postures, blows the bellows, changes tools etca. and therefore the quantity produced cannot be so great as in manu- factures of pins and buttons, where the work is reduced to simple operations.

(The manufacture of nails was common in central and east Scotland. In the village of Pathhead and Gailatown near Kirkcaldy a number of nailers worked domesticaUy, using iron supplied by merchants from Dysart. The growth of the iron industry in central Scotland provided local supplies later.)

I.i] the Wealth of Nations x9

be carried on in the same workhouse, the loss of time is no doubt much less. It is even in this case, however, very considerable. A man commonly saunters a little in turning his hand from one sort of employment to another. When he first begins the new work he is seldom very keen and hearty; his mind, as they say, does not go to it, and for some time he rather trifles than applies to good purpose.12The [i4] habit of saunter- ing and of indolent careless application, which is naturally, or rather necessarily13 acquired by every country workman who is obliged to change his work and his tools every half hour, and to apply his hand in twenty different ways almost every day of his life; renders him almost always slothful and lazy, and incapable of any vigorous application even on the most pressing occasions. Independent, therefore, of his deficiency in point of dexterity, this cause alone must always reduce considerably the quantity of work which he is capableof performing.14

8 Thirdly, and lastly, every body must be sensible how much labour is facilitated and abridged by the application of proper machinery. It is unnecessary to give any example?s I shall z only observe, mtherefore,m therefore, x m-mz-6

n Cf. ED z.xo: 'A man of great spirit and activity, when he is hard pushed upon some particular occasion, will pass with the greatest rapidity from one sort of work to another through a great variety of businesses. Even a man of spirit and activity, however, must be hard pushed before he can do this.' is Smith often juxtaposes the terms 'naturally' and 'necessarily'. See, for example,

I.viii.57, III.i.3, IV.i.3o, IV.ii.4, 6, IV.vii.c.8o, V.i.b.x2, V.i.f.z4, V.i.g.23. t4The preceding two sentences follow the concluding passages of ED z.xo very

closely. Similar arguments appear in LJ (A) vi.39-4o and LJ (B) zx6-x7, ed. Carman x66-7. _sSmith cites three major improvements apart from the fire engines mentioned below,

in I.xi.o.iz, and see also II.ii. 7. The 'condensing engine' and 'what is founded upon it, the wind gun' are cited as 'ingenious and expensive machines' in External Senses, x6. Cf. ED a.H: 'By means of the plough two men, with the assistance of three horses, will cultivate more ground than twenty could do with the spade. A miller and his servant, with a wind or water mill, will at their ease, grind more corn than eight men could do, with the severest labour, by hand mills.' A similar example occurs in LJ (B) zx7, ed. Carman x67, save that it is said that the miller and his servant 'will do more with the water miln than a dozen men with the hand miln, tho' it too be a machine'. LJ (B) does not mention the windmill and it is also interesting to note that the example provided at LJ (A) vi.4o is exactly the same as that provided in ED. It is stated at I.xi.o.xz that neither wind nor water mills were known in England at the beginning of the sixteenth century. Cf. Montesquieu, Esprit des Lois, trans. Thomas Nugent, ed. F. Neumarm (New York,

x959),XXIII.xv.3, where it is stated that machines are not always useful, for example, in cases where their effect is to reduce employment. He added that 'if water-mills were not everywhere established, I should not have believed them so useful as is pretended'. In commenting on this remark Sir James Steuart confirmed that the advantages of using machines were 'so palpable that I need not insist upon them', especially in the current situation of Europe. He did, however, agree that the introduction of machines could cause problems of employment in the very short run, and that they might have adverse consequences in an economy incapable of further growth. See especially the Pr/nz-/p/es of Political Oeconomy (London, x767), Lxix.

ao The Nature and Causes of [I.i

that the invention of all those machines by which labour is so much facili- tated and abridged, seems to have been originally owing to the division of labour.Men aremuch more likely to discover easierand readiermethods of attaining any object, when the whole attention of their minds is directed towards that single object, than when it is dissipated among agreatvariety of things. But in consequence of the division of labour, the whole of every man's attention comes naturally to be directed towards some one very simple object. It is naturally to be expected, therefore, that some one or other of those who are employed in each particular branch of labour should soon find out easier and readier methods of performing their own par- ticular work, wherever the nature of it admits of such [15] improvement: 6 A greatpart of the machines _madeuse of_in those manufactures in which labour is most subdivided, were originally the inventions of common workmen, who, being each of them employed in some very simple opera- tion, naturally turned their thoughts towards finding out easier and readier methods of performing it./7 Whoever has been much accustomed to visit such manufactures, must frequently have been shewn very pretty machines, which were the inventions of °such° workmen, in order to facilitate and quicken their own particular part of the work.is In the first fire-engines, t° a boy was constantly employed to open and shut alternately the communication between the boiler and the cylinder, according as the piston either ascended or descended. One of those boys, who loved to play with his companions, observed that, by tying a string from the handle of the valve, which opened this communication, to another part of the machine, the valve would open and shut without his assistance, and leave him at liberty to divert himself with his play-fellows. One of the greatest improvements that has been made upon this machine, n-_employed x o-, common z 16Exactly these views are expressed in ED z.xx and LJ (B) zx7, ed. Carman t67.

The brief statement in LJ (A) vi.4x reads that 'When one is employed constantly on one thing his mind will naturally be employed in devising the most proper means of improv- ing it.' _7It is stated at IV.ix.47 that invention of this kind is generally the work of freemen.

On the other hand Smith argues at V.i.f.5o that the mental faculties of the workers are likely to be damaged by the division of labour, thus affecting the flow of invention from this source. is Cf. LJ (A) vi.54: 'if we go into the workhouse of any manufacturer in the new

works at Sheffield, Manchester, or Birmingham, or even some towns in Scotland, and enquire concerning the machines, they will tell you that such or such an one was invented by some common workman.' See also Astronomy, II. t t : 'When we enter the work-houses of the most common artizans; such as dyers, brewers, distillers; we observe a number of appearances, which present themselves in an order that seems to us very strange and wonderful." 19In the Fourth Dialogue, Cleo refers to 'those Engines that raise Water by the Help

of Fire; the Steam you know, is that which forces it up.' Mandeville, The Fable of the Bees, pt. ii.x8x--z, ed. Kaye ii.I67. Fire engine was the name for the earliest steam engines. The story that follows seems untrue. See T. K. Derry and T. I. Willia_, A Short History of Technology (Oxford, x96o), 316--x9.

I.i] the Wealth of Nations 2x

since it was first invented, was in this manner the discovery of a boy who wanted to save his own labour. 2°

9 All the improvements in machinery, however, have by no means been the inventions of those who had occasion to use the machines. Many improvements have been made by the ingenuity of the makers of the machines, when [x6] to make them became the business of a peculiar trade ;21 and some by that of those who are called philosophers or men of speculation, whose trade it is, not to do any thing, but to observe every thing; and who, upon that account, are often capable of combining together the powers of the most distant and dissimilar objects. 22 In the progress of society, philosophy or speculation becomes, like every other employment, the principal or sole trade and occupation of a particular class of citizens. Like every other employment too, it is subdivided into a great number of different branches, each of which affords occupation 20In general, Smith concluded that machines would tend to become simpler as the

result of improvement; a point made in Astronomy, IV.x9 and First Formation of Lan- guages, 4.x. He also commented in LRBL i.v.34, ed. Lothian xx, that 'machines are at first vastly complex but gradually the different parts are more connected and supplied by one another.' In ED 2.I x Smith ascribes the invention of the Drill Plow to the farmer while claiming that some 'miserable slave' probably produced the original hand-mill (cf. below, IV.ix.47). On the other hand, some improvements were ascribed to those who made the instruments involved, as distinct from using them, and to the 'successive dis- coveries of time and experience, and of the ingenuity of different artists'. This subject is briefly mentioned in LJ (B) 217-x8, ed. Carman x67. LJ (A) vi.4z-3 provides a more elaborate illustration of the kind found in ED, while stating that the inventions of the mill and plough are so old that history gives no account of them (54). 2aThe 'fabrication of the instruments of trade' is described as a specialized function

at IV.viii. L zz Cf. ED. z.xx. Smith here suggests that it was probably a philosopher who first

thought of harnessing both wind and water, especially the former, for the purposes of milling. Smith added that while the application of powers already known was not beyond the ability of the ingenious artist, innovation amounting to 'the application of new powers, which are altogether unknown' is the contribution of the philosopher (i.e. scientist):

When an artist makes any such discovery he showes himself to be not ameer artist but a real philosopher, whatever may be his nominal profession. It was a real philo- sopher only who could invent the fire-engine, and first form the idea of producing so great an effect by a power in nature which had never before been thought of. Many inferior artists, employed in the fabric of this wonderful machine, may afterwards discover more happy methods of applying that power than those first made use of by its illustrious inventer.

In a note to the passage just cited W. R. Scott suggested that Smith was probably refer- ring to James Watt. Similar points regarding the role of the philosopher are made in LJ (A) vi.42-3, and more briefly in LJ (B) 2x8, ed. Carman x67--8. Mandeville (The Fable of the Bees, pt. ii.I52, ed. Kaye ii.x44) was more sceptical

with regard to the rrle of the philosopher: 'They are very seldom the same Sort of People, those that invent Arts, and Improvements in them, and those that enquire into the Reason of Things: this latter is most commonly practis'd by such, as are idle and indolent, that are fond of Retirement, hate Business, and take delight in Speculation: whereas none succeed oftener in the first, than active, stirring, and laborious Men, such as will put their Hand to the Plough, try Experiments, and give all their Attention to what they are about.'

22 The Nature and Causes of [I.i

to a peculiar tribe or class of philosophers; and this subdivision of employ- ment in philosophy, as well as in every other business, improves dexterity, and saves time. Each individual becomes more expert in his own peculiar branch, more work is done upon the whole, and the quantity of science is considerably increased by it.23

xo It is the great multiplication of the productions of all the different arts, in consequence of the division of labour, which occasions, in a well- governed society, that universal opulence which extends itself to the lowest ranks of the people. 24 Every workman has a great quantity of his own work to dispose of beyond what he himself has occasion for; and every other workman being exactly in the same situation, he is enabled to ex- change a great quantity of his own goods for a great quantity, or, what comes to the same thing, for the price of a great quan-[I7]tity of theirs. He supplies them abundantly with what they have occasion for, and they accommodate him as amply with what he has occasion for, and a general plenty diffuses itself through all the different ranks of the society.

ii Observe the accommodation of the most common artificer or day- labourer in a civilized and thriving country, and you will perceive that the number of people of whose industry a part, though but a small part, has been employed in procuring him this accommodation, exceeds all computation. The woollen coat, for example, which covers the day- labourer, as coarse and rough as it may appear, is the produce of the joint labour of a great multitude of workmen. 2s The shepherd, the sorter of the wool, the wool-comber or carder, the dyer, the scribbler, the spinner, the weaver, the fuller, the dresser, with many others, must all join their different arts in order to complete even this homely production. _zThe last two paragraphsareconsideredin ED 2.xx, but in a form which suggests

that this section of the WN was considerably redrafted, although the preceding three sentences correspond very closelyto the concluding sentences of ED z.lx. In the ED Smith provides examples drawn from the separate trades of 'mechanical, chemical, astronomical, physical, metaphysical, moral, political, commercial, and critical philo- sophers'. LJ (A) vi.43 includes a shorter list, but mentions 'ethical' and 'theological' philosophers. a4This sentence correspondsto the opening sentenceof ED z.6 savethat Smith there

refers to an 'immense multiplication' and'allcivilised societies'. He also alludedto 'the greatinequalitiesof property' in the modem state. Seebelow, p. 24n. 29. 2sRelatedargumentsoccur in LJ (A) vi.z6-x7; LJ (B) 2xx-x2, ed. Carman x6x-3.

Theexampleof the 'coarsebluewoolen coat'is cited in ED 2.x, LJ (A) vi.2xand LJ(B) 2xx, ed. Carman x6L Cf. Mandeville (The Fable of the Bees, pt. i.I82-3, ed. Kaye i.169-7o): 'A Manwould be laugh'dat, that shoulddiscoverLuxury in the plain Dress of a poorCreaturethat walksalong in a thick ParishGown and a coarse Shirtunder° neath it; andyetwhat anumberof People,howmanydifferentTrades, andwhatavariety of Skilland Toolsmust be employedto have the mostordinary Yor_hire Cloth? What depth of Thought and Ingenuity,what Toil and Labour, and what length of Time must it have cost, beforeMan could learn froma Seed to _ and preparesouseful a ProductasLinen.' Cf. ibid.,part i.4xx,ed.Kaye i.356: 'Whata Bustleisthereto bemade in several Partsof the World,before a fine Scarlet or crim_n Cloth can be produced, what Multiplicity of Trades andArtificersmust be employ'dl'

I.i] the Wealth of Nations 23

How many merchants and carriers, besides, must have been employed in transporting the materials from some of those workmen to others who often live in a very distant partof the country! How much commerce and navigation in particular, how many ship-builders, sailors, sail-makers, rope-makers, must have been employed in order to bring together the different drugs made use of by the dyer, which often come from the remotest corners of the world! What a variety of labour too is necessary in order to produce the tools of the meanest of those workmen! To say nothing of such complicated ma-[i8]chines as the ship of the sailor, the mill of the fuller, or even the loom of the weaver, let us consider only what a variety of labour is requisite in order to form that very simple machine, the shears with which the shepherd clips the wool._ The miner, the builder of the furnace for smelting the ore, the feller of the timber, the burner of the charcoal to be made use of in the smelting-house, the brick-maker, the brick-layer, the workmen who attend the furnace, the mill-wright, the forger, the smith, must all of them join their different arts in order to produce them. Were we to examine, in the same manner, all the different parts of his dress and household furniture, the coarse linen shirt which he wears next his skin, the shoes which cover his feet, the bed which he lies on, and all the different parts which compose it, the kitchen-grate at which he prepareshis victuals, the coals which he makes use of for that purpose, dug from the bowels of the earth, and brought to him perhaps by a long sea and a long land carriage, all the other utensils of his kitchen, all the furniture of his table, the knives and forks, the earthen or pewter plates upon which he serves up and divides his victuals, the different hands employed in preparing his bread and his beer, the glass window which lets in the heat and the light, and keeps out the wind and the rain, with all the knowledge and art requisite for preparing that beautiful and happy invention, without which these northernparts of the world could scarce haveafforded avery Ix9]comfort- able habitation, together with the tools of all the different workmen em- ployed in producing those different conveniencies; if we examine, I say, all these things, and consider what a variety of labour is employed about each of them, we shall be sensible that without the assistance and co- operation of many thousands, the very meanest person in a civilized country could not be provided, even according to, what we very falsely imagine, the easy and simple manner in which he is commonly accom- modated.27Compared, indeed, with the more extravagant luxury of the 26ED 2. x refers to the variety of labour needed to 'produce that very simple machine,

the sheers of the clipper'. ' 't.is obvious that for the support of human life, to allay the painful cravings of the

appetites, and to afford any of those agreeable external enjoyments which our nature is capable of, a great many external things are requisite; such as food, cloathing, habita- tions, many utensils, and various furniture, which cannot be obtained without a great

24 The Nature and Causes of the Wealth of Nations [I.i

great, his accommodation must no doubt appear extremely simple and easy; and yet it may be true, perhaps, that the accommodation of an Euro- pean prince does not always so much exceed that of an industrious and frugal peasant,2sas the accommodation of the latter exceeds that of many an African king, the absolute master of the lives and liberties of ten thousand naked savages,z_ deal of art and labour, and the friendly aids of our fellows.' (Francis Huteheson, A Sys- tem of Moral Philosophy (London, x755), i.z87). John Locke (Essay on Civil Government (3rd ed. x698), Works (London, 18z3), v.363) also noted that:

'Twoud be a strange catalogue of things, that industry provided and made use of, about every loaf of bread, before it came to our use, if we could trace them; iron, wood, leather, bark timber, stone, bricks, coals, lime, cloth, dyeing, drugs, pitch, tar, masts, ropes, and all the materials made use of in the ship, that brought any of the commodities used by any of the workmen, to any part of the work: all which it would be almost impossible, at least too long, to reckon up. See also Thomas Mun, England's Treasure by Forraigne Trade (London, x664), iii.xz.

eL Mandeville (The Fable of the Bees, pt. i.x8x, ed. Kaye i.x69): 'If we trace the most flourishing Nations in their Origin, we shall find that in the remote Beginnings of every Society, the richest and most considerable Men among them were a great while destitute of a great many Comforts of Life that are now enjoy'd by the meanest and most humble Wretches.' 29The phrase 'absolute master' occurs in ED z.x in contrasting the luxury of the

common day-labourer in England with that of 'many an Indian prince, the absolute master of the lives and liberties of a thousand naked savages'. The same paragraph also contains a contrast with the 'chief of a savage nation in North America'. LJ (A) vi.zx, z3 repeats the former example. Cf. LJ (B) zxz, ed. Cannan x6z. It is also remarked at z87, ed. Carman z23, that one explanation of the contrast is to be found in the fact that 'An Indian has not so much as a pick-ax, a spade, nor a shovel, or any thing else but his own labour.' There is a considerable difference in the order in which the argument of ED and this

part of the WN develops. For example, ED opens chapter z with an analysis which is very similar to that set out in the lest two paragraphs of this chapter. It is then argued that while it earmot be difficult to explain the contrast between the poor savage and the modem rich (i.e. by reference to the division of labour), yet 'how it comes about that the labourer and the peasant should likewise be better provided is not perhaps so easily understood'. Smith further illustrates the difficulty by reference to the 'oppressive inequality' of the modem state; a theme which is developed at considerable length (mainly in z.z,3) before the paradox is resolved by reference to arguments similar to those developed in the first nine paragraphs of this chapter. In LJ (A) and (B) the argument follows a simi- lar order to that found in ED, save that the discussion opens in each ease with an account of the 'natural wants of mankind', introducing by this means the general point that even the simplest wants require a multitude of hands before they can be satisfied. The 'natural wants' thesis would, presumably, have figured in the (missing) first chapter of ED. See LJ (A) vi.8-x8; LJ (B) zo6-x3, ed. Carman x57-63. The link between the development of productive forces and the natural wants of man also features in Hume's essays 'Of Commerce' and 'Of Refinement in the Arts'.

CHAPTER II

Of the Principle which gives occasion to the Division of Labour

t THIS division of labour, from which so many advantages are derived, is not originally the effect of any human wisdom, which foresees and intends that general opulence to [20] which it gives occasion,t 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. 2

2 Whether this propensity be one of those original principles in human nature, of which no further account can be given; or whether, as seems more probable, it be the necessary consequence of the faculties of reason and speech, it belongs not to our present subject to enquire. 3It is common to all men, and to be found in no other race of animals, which seem to know neither this nor any other species of contracts. Two greyhounds, in running down the same hare, have sometimes the appearance of acting in some sort of concert. Each turns her towards his companion, or en- deavours to intercept her when his companion turns her towards himself. This, however, is not the effect of any contract, but of the accidental

t LJ (B) 2xS--x9, ed. Cannan t68 reads: 'We cannot imagine this to have been an effect of human prudence. It was indeed made a law by Sesostratis that every man should follow the employment of his father. But this is by no means suitable to the dispositions of human nature and can never long take place. Everyone is fond of being a gentleman, be his father what he would.' The law is also mentioned in LJ (A) vi.54. See below, I.vii.3x and IV.ix.43. 2This paragraph closely follows the first three sentences in ED 2.x2. The propensity

to truck and barter is also mentioned in LJ (A) vi.44., 48 and LJ (B) 2x9 If., ed. Carman I69. Cf. LJ (B) 3oo--x, ed. Carman 232: 'that principle in the mind which prompts to truck, barter and exchange, tho' it is the great foundation of arts, commerce and the division of labour, yet it is not marked with any thing amiable. To perform any thing, or to give any thing without a reward is always generous and noble, but to barter one thing for another is mean.' In a Letter from Governor Pownall to Adam Smith, being an Examination of Several Points of Doctrine laid down in his Inquiry, into the Nature and Causes of the Wealth of Nations (London, x776), the author objected that the analysis of this chapter stopped short in ascribing the division of labour directly to a propensity to barter (4-5). Pownall, a former Governor of Massachusetts, also criticized Smith's views on labour as a measure of value, paper money, the employments of capital, colo- nies, etc. Smith acknowledged Pownall's work in Letter x8a addressed to Pownall, dated x9 January x777. In Letter 208 addressed to Andreas Holt, dated 26 October x78o Smith remarked that: 'In the second edition I flattered myself that I had obviated all the objections of Governor Pownal. I find however, he is by no means satisfied, and as Authors are not much disposed to alter the opinions they have once published, I am not much surpdzed at it.' There is very little evidence to suggest that Smith materially altered his views in response to Pownall, but see below, p. 50, n. xS. 3 In LJ (B) 22I, ed. Carman x7x, Smith argued in referring to the division of labour

that 'The real foundation of it is that principle to persuade which so much prevails in human nature.' The same point is made in LJ (A) vi.56.

26 The Nature and Causes of [I.ii

concurrence of their passions in the same object at that particular time.4 Nobody ever saw a dog make a fair and deliberate exchange of one bone for another with another dog. Nobody ever saw one animal by its ges- tures and natural cries signify to another, this is mine, that yours; I am willing to give this for that. When an animal wants to obtain some- thing either of a man or of another animal, it has no other means of persuasion but to gain the favour of those whose service it requires. A puppy fawns upon its dam, and a spaniel endea-[2I]vours by a thousand attractions to engage the attention of its master who is at dinner, when it wants to be fed by him. Man sometimes uses the same arts with his breth- ren, and when he has no other means of engaging them to act according to his inclinations, endeavours by every servile and fawning attention to obtain their good will. He has not time, however, to do this upon every occasion. In civilized society he stands at all times in need of the co- operation and assistance of great multitudes, while his whole life is scarce sufficient to gain the friendship of a few persons. In almost every other race of animals each individual, when it is grown up to maturity, is in- tirely independent, and in its natural state has occasion for the assistance of no other living creature,s But man has almost constant occasion for the help of his brethren, and it is in vain for him to expect it from their benevolence only.° He will be more likely to prevail if he can interest their self-love in his favour, and shew them that it is for their own ad- vantage to do forhim whathe requires of them. Whoever offers to another a bargain of any kind, proposes to do this. Give me that which I want, and you shall have this which you want, is the meaning of every such offer; and it is in this manner that we obtain from one another the far greater part of those good offices which we stand in need of. It is not from

4 The example of the greyhounds occurs in LJ (B) 2x9, ed. Carman I69. LJ (A) vi.44 uses the example of 'hounds in a chace' and again at 57. Cf. LJ (B) e22, ed. Carman XTt: 'Sometimes, indeed, animals seem to act in concert, but there is never any thing like a bargain among them. Monkeys when they rob a garden throw the fruit from one to another till they deposit it in the hoard, but there is always a scramble about the divi- sion of the booty, and usually some of them are killed.' In LJ (A) vi.57 a similar example is based on the Cape of Good Hope. s In ED _.12 an additional sentence is added at this point: 'When any uncommon mis-

fortune befals it, its piteous and doleful cries will sometimes engage its fellows, and sometimes prevail even upon man, to relieve it.' With this exception, and the first sentence of this paragraph, the whole of the preceding material follows ED 2.t2 very closely and in places verbatim. The remainder of the paragraph follows ED 2.I2 to its close. 6 'To expect, that others should serve us for nothing, is unreasonable; therefore all

Commerce, that Men can have together, must be a continual battering of one thing for another. The Seller, who transfers the Property of a Thing, has his own Interest as much at Heart as the Buyer, who purchases that Property; and, if you want or like a thing, the Owner of it, whatever Stock of Provision he may have of the same, or how greatly soever you may stand in need of it, will never part with it, but for a Consideration, which he likes better, than he does the thing you want.' (Mandeville, The Fable of the Bees, pt. ii. 4_x-2, ed. Kaye, ii.349.)

I.ii] the Wealth of Natiom 27

the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from their [22] regard to their own interest. We address ourselves, not to their humanity but to their self-love, and never talk to them of our own necessities but of their advantages.7 Nobody but a beggar chuses to depend chiefly upon the benevolence of his fellow- citizens. Even a beggar does not depend upon it entirely. The charity of well-disposed people, indeed, supplies him with the whole fund of his subsistence. But though this principle ultimately provides him with all the necessaries of life which he has occasion for, it neither does nor can provide him with them as he has occasion for them. The greater part of his occasional wants are supplied in the same manner as those of other people, by treaty, by barter, and by purchase. With the money which one man gives him he purchases food. The old cloaths which another bestows upon him he exchanges for other old cloaths which suit him better, or for lodging, or for food, or for money, with which he can buy either food, cloaths, or lodging, as he has occasion.

3 As it is by treaty, by barter, and by purchase, that we obtain from one another the greater part of those mutual good offices which we stand in need of, so it is this same trucking disposition which originallygives occa- sionto the division of labour. In atribe of huntersorshepherds aparticular person makes bows and arrows, for example, with more readiness and dexterity than any other. He frequently exchanges them for cattle or for venison with his companions; and [23] he finds at last that he can in this manner get more cattle and venison, than if he himself went to the field to catch them. From a regard to his own interest, therefore, the making of bows and arrowsgrows to be his chief business, and he becomes a sort of armourer,s Another excels in making the frames and covers of their

Cf. LJ (B) 2zo, ed. Cannan x69: 'The brewer and the baker serve us not from bene- volence but from selflove. No man but a beggar depends on benevolence, and even they would die in a week were their entire dependance upon it.' Also LJ (A) vi.46: 'You do not adress his [the brewer's and baker's] humanity but his self-love. Beggars are the only persons who depend on charity for their subsistence; neither do they do so aUtogether. For what by their supplications they have got from one, they exchange for something else they more want. They give their old cloaths to a one for lodging, the mony they have got to another for bread, and thus even they make use of bargain and exchange.' s CL LJ (A) vi.46: 'This bartering and trucking spirit is the cause of the separation of

trades and the improvements in arts. A savage who supports himself by hunting, having made some more arrows than he had occasion for, gives them in a present to some of his companions, who in return give him some of the venison they have catched; and he at last finding that by making arrows and giving them to his neighbour, as he happens to make them better than ordinary, he can get more venison than by his own hunting, he lays it aside unless it be for his diversion, and becomes an arrow-maker.' Similar points are made in LJ (B) 22o, ed. Cannan I69-7o, and a similar passage occurs in ED 2.t3. Mandeville (The Fable of the Bees, pt. ii. 335--6, ed. Kaye ii.284) also noted that: 'Man', as I have hinted before, naturally loves to imitate what he sees others do, which is the reason that savage People all do the same thing: This hinders them from meliorating their Condition, though they are always wishing for it: But if one will wholly apply him- self to the making of Bows and Arrows, whilst another provides Food, a third builds

28 The Nature and Causes of [I.ii

little huts or moveable houses. He is accustomed to be of use in this way to his neighbours, who reward him in the same manner with cattle and with venison, till at last he finds it his interest to dedicate himself entirely to this employment, and to become a sort of house-carpenter. In the same manner a third becomes a smith or a brazier, a fourth a tanner or dresser of hides or skins, the principal part of the clothing of savages. 9 And thus the certainty of being able to exchange all that surplus part of the produce of his own labour, which is over and above his own con- sumption, for such parts of the produce of other men's labour as he may have occasion for, encourages every man to apply himself to a particular occupation, and to cultivate and bring to perfection whatever talent or genius he may possess for that particular species of business. 1°

4 The difference of natural talents in different men is, in reality, much less than we are aware of; and the very different genius which appears to distinguish men of different professions, when grown up to maturity, is not upon many occasions so much the cause, as the effect of the divi- sion of labour, tt The difference between the [24] most dissimilar charac- ters, between a philosopher and a common street porter, for example, Huts, a fourth makes Garments, and a fifth Utensils, they do not only become useful to one another, but the Callings and Employments themselves will in the same Number of Years receive much greater Improvements, than if all had been promiscously follow'd by every one of the Five.' 9 Cf. Hutcheson (System, i.288-9): "Nay 'tis well known that the produce of the

labours of any given number, twenty, for instance, in providing the necessaries or con- veniences of life, shall be much greater by assigning to one, a certain sort of work of one kind, in which he will soon acquire skill and dexterity, and to another assigning work of a different kind, than if each one of the twenty were obliged to employ himself, by turns, in all the different sorts of labour requisite for his subsistence, without sufficient dexterity in any. In the former method each procures a great quantity of goods of one kind, and can exchange a part of it for such goods obtained by the labours of others as he shall stand in need of. One grows expert in tillage, another in pasture and breeding cattle, a third in masonry, a fourth in the chace, a fifth in iron-works, a sixth in the arts of the loom, and so on throughout the rest. Thus all are supplied by means of barter with the work of complete artists. In the other method scarce any one could be dextrous and skilful in any one sort of labour.' 10 This paragraph is based on ED 2.13, which it follows very closely. tt 'When we consider how nearly equal all men are in their bodily force, and even

in their mental powers and faculties, till cultivated by education; we must necessarily allow, that nothing but their consent could, at first, associate them together, and subject them to any authority.' (D. Hume, 'Of the Original Contract', in Political Discourses (t752); Essays Moral, Political and Literary, ed. T. H. Green and T. H. Grose (London, i882), i.444-5.) Cf. Treatise of Human Nature, III.i: 'The skin, pores, muscles, and nerves of a day-labourer, are different from those of a man of quality: so are his sentiments, actions, and manners. The different stations of life influence the whole fabric, external and internal; and these different stations arise necessarily, because uniformly, from the necessary and uniform principles of human nature.' On the other hand, Harris (Essay, i. 15) believed that: 'Men are endued with various talents and propensities, which natur- ally dispose and fit them for different occupations; and are.., under a necessity of betaking themselves to particular arts and employments, from their inability of otherwise acquiring all the neceq._aries they want, with ease and comfort. This creates a depen- dance of one man upon another, and naturally unites men into societies.'

I.ii] the Wealth of Nations 29

seems to arise not so much from nature, as from habit, custom, and educa- tion. 12When they came into the world, and for the first six or eight years of their existence, they werea, perhaps, a very much alike, and neither their parents nor play-fellows could perceive any remarkable difference. About that age, or soon after, they come to be employed in very different occupa- tions. The difference of talents comes then to be taken notice of, and widens by degrees, till at last the vanity of the philosopher is willing to acknow- ledge scarce any resemblance. But without the disposition to truck, barter, and exchange, every man must have procured to himself every necessary and conveniency of life which he wanted. All must have had the same duties to perform, and the same work to do, and there could have been no such difference of employment as could alone give occasion to any great difference of talents. 13

5 As it is this disposition which forms that difference of talents, so remarkable among men of different professions, so it is this same disposi- tion which renders that difference useful. Many tribes of animals acknow- ledged to be all of the same species, derive from nature a much more remarkable distinction of genius, than what, antecedent to custom and _a I, 4e-6

12 Cf. V.i.f 51. LJ (A) vi.47-8 reads: 'No two persons can be more different in their genius as a philosopher and a porter, but there does not seem to have been any original difference betwixt them. For the five or six first years of their lives there was hardly any apparent difference: their companions looked upon them as persons of pretty much the same stamp. No wisdom and ingenuity appeared in the one superior to that of the other. From about that time a difference was thought to be perceived in them. Their manner of life began to affect them, and without doubt had it not been for this they would have continued the same.' Similar arguments appear in LJ (B) 220, ed. Carman XTO.There is an interesting variant on this point in LJ (B) 327, ed. Cannan 253, where Smith com- mented on the fact that 'probity and punctuality' generally accompany the introduction of commerce. He added that varying degrees of these qualities were 'not at all to be imputed to national character as some pretend. There is no natural reason why an English- man or a Scotchman should not be as punctual in performing agreements as a Dutchman. It is far more reduceable to self interest, that general principle which regulates the actions of every man...' 13The whole of the preceding paragraph follows ED 2.I4 to this point. In ED, how-

ever, the sentence ends with '... any great difference in character' and goes on: 'It is upon this account that a much greater uniformity of character is to be observed among savages than among civilized nations. Among the former there is scarce any division of labour and consequently no remarkable difference of employments; whereas among the latter there is an almost infinite variety of occupations, of which the respective duties bear scarce any resemblance to one another. What a perfect uniformity of character do we find in all the heroes described by Ossian ? And what a variety of manners, on the con- trary, in those who are celebrated by Homer? Ossian plainly describes the exploits of a nation of hunters, while Homer paints the actions of two nations, who, tho' far from being perfectly civilised, were yet much advanced beyond the age of shepherds, who cultivated lands, who built cities, and among whom he mentions many different trades and occupations, such as masons, carpenters, smiths, merchants, soothsayers, priests, physicians.' The texts then assume a similar form until the end of the following para- graph of the WN. The uniformity of character found among savages is also mentioned in LJ (A) vi.48 , LJ (B) 22i, ed. Carman x7o.

3o The Nature and Causes of the Wealth of Nations [].ii

education, appears to take place among men. By nature a philosopher is not in genius and disposition half so different from a street porter, as a mastiff is from a greyhound, or a greyhound from a spaniel, or this [25] last from a shepherd's dog. Those different tribes of animals, however, though all of the same species, are of scarce any use to one another. The strength of the mastiff is not, in the least, supported either by the swift- ness of the greyhound, or by the sagacity of the spaniel, or by the docility of the shepherd's dog. The effects of those different geniuses and talents, for want of the power or disposition to barter and exchange, cannot be brought into a common stock, and do not in the least contribute to the better accommodation and convenieney of the species. Each animal is still obliged to support and defend itself, separately and independently, and derives no sort of advantage from that variety of talents with which nature has distinguished its fellows. Among men, on the contrary, the most dissimilar geniuses are of use to one another; the different produces of their respective talents, by the general disposition to truck, barter, and exchange, being brought, as it were, into a common stock, where every man may purchase whatever part of the produce of other men's talents he has occasion for.14

t4The text ofED continuesbeyond this point to include an additionalfolio(N8)which elaborateson the interdependencebetween the philosopher and the porterand the ad- vantages tobe gained fromthese separatetrades.This passageopenswith the statement that 'Every thing would be dearerif beforeit was exposed to sale it had been carried packt and unpackt by hands less able and less dexterous, who for an equal quantity of work,would have taken moretime, and must consequentlyhave requiredmorewages. which must havebeen chargedupon the goods.' It is interesting to note that FA begins with the words '... who foran equal quantity of work' and then continues in parallel with ED for somez5 lines. The fragmentthen proceedsto elaborateon the linkbetween the divisionof labour and the extent of the market(a subject which is not mentioned in ED) whereasED continueswith the precedingtheme. It is possiblethat the fragments represent an alternative,and a later,rewritingof this section of Smith's work.The inter- dependenceof philosopherand porter is brieflymentioned in LJ (A) vi.49, LJ (B)2ax, ed. Carmanx7x.

456 The Nature and Causes of [IV.ii

precisely the same thing with that exchangeable value,x2As every individ- ual, therefore, endeavours as much as he can both to employ his capital in the support of domestick industry, and so to direct that industry that its produce may be of the greatest value; every individual necessarily labours to render the annual revenue of the society as great as he can.a3He gen- erally, indeed, neither intends to promote the publick interest, nor knows how much he is promoting it. By preferring the support of domestiek to that of foreign industry, he intends only his own security; and by di- reefing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain, and he is in this, as in many other eases, led by an invisible hand to promote an end which was no part of his intention, x4Nor is it always the worse for the society that it was no part of it. By pursuing his own interest he frequently promotes that of the society more effectually than when he really intends to promote it. I have never known much good done by those who affected to trade for the publick good. It is an [ISz] affectation, indeed, not very common among merchants, and very few words need be employed in dissuading them from it.15

xo What is the species of domestick industry which his capital can employ, and of which the produce is likely to be of the greatest value, every indi- vidual, it is evident, can, in his local situation, judge much better than any statesman or lawgiver can do for him. The stateman, who should attempt to direct private people in what manner they ought to employ their capitals, would not only load himself with a most unnecessary attention, but assume an authority which could safely be trusted, not only to no single person, but to no council or senate whatever, and which would nowhere be so dangerous as in the hands of a man who had folly and presumption enough to fancy himself fit to exercise it.a6

I To give the monopoly of the home-market to the produce of domestick industry, in any particular art or manufacture, is in some measure to direct private people in what manner they ought to employ their capitals, and must, in almost all cases, be either a useless or a hurtful regulation. If the produce of domestick can be brought there as cheap as that of foreign industry, the regulation is evidently useless. If it cannot, it must generally be hurtful. It is the maxim of every prudent master of a family, never to attempt to make at home what it will cost him more to make than to buy. The taylor does not attempt to make his own shoes, but buys them of the 12A similar point is made at I.vi.t7, I.xi.p.7, and II.ii.x. 13See below, IV.vii.c.88. 14Cf. TMS IV.i.x.xo, where Smith also uses the concept of the 'invisible hand' in an

economic context. is There isan interesting variation on this theme in Steuart's Prin_'ples, i.x65, ed. Skinner

i._43-4. 1¢Similar sentiments are expressed in IV.v.b.x6 and IV.ix.sx , where intervention is

said to be presumptuous and impolitic, not to mention unjust. The argument isalsoapplied at I.x.c.xa.