Main ideas of Adam Smith

Main ideas of Adam Smith
Student:
Professor:
Course title:
Date:
Main ideas of Adam Smith
Introduction
Adam Smith – 1723 to 1790 – is best known for his pioneering work as far as capitalism is concerned. An 18th century philosopher, Smith advocated from capitalism and would write many books all of which sought to justify the ideology. He made many assertions regarding capitalism and economic issues all of which he provided substantial backing. It was through his ideas of capitalism that people would develop a different idea of what trade and economy is. According to Adam Smith, the only way an economy of a country would grow was by allowing for more capital to come and encourage private ownership of property as opposed to communal ownership.
Self Interest
This is one of the aspects of liberal capitalism that Adam Smith advocated for. He argued that concern for oneself over concern for all others is the biggest driver of economic prosperity. Adam Smith argued that although self interest is always associated with greed and lack of morality, it does not always make it wrong. He asserted that in order to achieve success and growth, it is easier when it is done at an individual level (Pack, 2010). While it is good to promote the interest of others the differing ideas and interests are likely to slow down the process of growth. He therefore advocated for self interest as way of acquiring economic growth. He further argued that self interest is propagated by nature. Every person naturally tends to look out for themselves. He hence did not see the immorality of self interests and argued that people should be encouraged to have self interest. In his opinion, it is not practically possible to look out for other people without looking for oneself first.
The Invisible Hand in the Market
The concept of invisible hand is also part of the concept of liberal capitalism. Adam Smith argued that when people are selling items in the market, their ultimate aim is to make profits from the sale. This is a promotion of one’s self interest. However, in doing so, the interests of other people who are interested in the items are covered. Although promotion of interests for other people happens unintentionally, it still happens all the same. According to this concept therefore, there is an invisible hand within the market, which ensures that interests of all people are served (Pack, 2010). The invisible hand in the market ensures that all needs are met even as people seek to fulfil their self interests. In so doing, there is promotion of liberalism in the market.
Non-Intervention by Government
The concept of non-intervention is also a concept that sought to achieve liberalism in the market. He promoted this idea to achieve freedom of markets. He argued that for a market to thrive, freedom from government interference was important. Smith (2007) argued that the only way for market to achieve freedom was ensuring t...