1. If you used Smith’s form
of reckoning, how would you measure the wealth of your family or your home
town? How would it differ from measuring how much money you have in the bank,
or in assets such as property?
2. Plato and Aristotle also
thought of something like the ‘division of labor’ as a central way of
describing society. How does Smith’s version of it compare?
3. What is ‘hidden’ about
the ‘hidden hand’? Explicate the following: 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.” (I, chapter
2)
4. Smith is often seen as a founder of
capitalism. What is ‘capital’ and why should it have such a central role as to
be used in the name of the system?
5. Smith might be described
as one of the first social scientists, seeking to analyze society
‘objectively’. What would be the way to defend that argument? How does he
compare with Machiavelli, of which the same is often said?
6. Smith is best know for
promoting what is called ‘laissez faire’, but he also advocated government
action. Of what sorts and why? How would he view the demands for more
‘regulation’ of the financial industry?
Application 1: Smith
provides a role for government in supporting education to make increased wealth
possible. From this standpoint what would you advise Trump, if he was intent on
increasing the wealth of this nation?
Application 2: What
interactions at Columbia show the workings of an ‘invisible hand’ i.e., the
positive outcome of people’s interactions, even though no one participating in
the action intends to make that outcome?
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