Adam Smith's Theory Of Moral Sentiment

The Scottish philosopher and economist, Adam Smith, is celebrated as the “Father of modern economics” (Campbell & Skinner, 1982:169). The views and theories presented in his magnum opus, The Wealth of Nations, have largely contributed to the rise of capitalism which is the primary economic system of our modern world. Smith is well known as a great economist; however, as his Theory of Moral Sentiments proves, Smith was also a great moral philosopher. Smith’s ideas have had a profound impact on contemporary ethics and economics alike

Smith’s work was highly regarded by famous politicians such as Margaret Thatcher and Ronald Reagan. Most people today are familiar with Smith’s political and economic theories. However, the alleged father of modern

(Coase, 1976). He was acutely aware of the fact that a commercial society would possess ethical and moral shortcomings. Therefore, Smith “meticulously analysed and responded to Rousseau’s powerful critiques of its materialism, inequality, and inauthenticity” (Recovering Adam Smith 's ethical economics , 2012). Smith saw moral philosophy and economics as inextricably linked. However, today, there is a clear distinction between these two disciplines and generally they are taught separately. This is possibly why so many people today struggle to effectively associate Smith’s moral views with his economic views (Colaco, 2010).

Adam Smith produces arguments in favour of free trade, the division of labour, and limitations on government intervention in economic affairs in The Wealth of Nations (Coase, 1976) Nevertheless, interpersonal sympathy, as well as the development of an ‘impartial spectator’ within the moral individual, is essentially the foundation of Smith’s moral philosophy (Pack,

The Wealth of Nations certainly does acknowledge the role of self-interest in motivating human behaviour, especially in economic situations, which supports Smith’s assertion in the Theory of Moral Sentiments that self-preservation is a virtue. Nevertheless, Smith does also stress the destructiveness of pure selfishness. He believes that upon this foundation it would be impossible to establish institutions such as law, justice or governance. Therefore, he praises qualities such as self-denial and prudence, as well as loving one’s neighbour, in the Theory of Moral Sentiments (Colaco,