Treatise Of Human Nature Analysis

Abstract:-

Though better known as a philosopher, the Scottish David Hume expressed particularly relevant ideas in the realm of economic thought. As such his empirical argument against British mercantilism became the foundations of classical economics. His series of Essays in his Political Discourse(1752) are considered to be inspirations for modern economic theories in the ambits of money, international trade and growth and are believed to have strongly influenced his friend and fellow countryman Adam Smith. To understand his economics visions, one must read his essays of 1752 in along with his other works; as such, his Treatise of Human Nature (1739-40) embodies a rich and trenchant account of human agency as well as insights on the nature

Consequently, it needs to be managed efficiently with the idea of private ownership. Hume viewed trade as something mutually beneficial where both parties gain and vociferously refutes the zero-sum game argument. Countries that indulge in foreign trade are wealthier than those that refrain from doing so; imports provide raw materials for goods to be manufactured and exports allow domestically produced goods to be exchanged for foreign merchandise thereby increasing the well-being and living standard of individuals. In his essay "Of Commerce" he advocates for least government interference, while not being a 'pure ' laissez-faire advocate, he favoured the infant industry argument. Before Hume’s era, it was common belief that interest rates were determined by the forces of demand and supply for real capital rather than money or by the quantity of money in circulation; however, Hume, on the basis of his theory of human nature and drawing upon instances from history argued that low interest is the result of the growth of industry and commerce, which tends to increase the number of lenders and reduce the number of

Furthermore, Hume viewed everything in the world as having value due to the amount of labour put into it and favoured a labour theory of value,wealth is a product of physical or mental labour, and Smith’ s thinking reflects the same, it can be thus inferred that the latter borrowed it from Hume. Both thinkers also had as an intellectual focus, economic growth and its causes.

Hume’s theory of taxation challenges the view of French physiocrats and questions the subsistence theory of wages and the view that entrepreneurial activity does not yield a surplus. National wealth would be enhanced if taxes were raised a little so as to incentivise the individual to work but too big an increase would curtail the incentive to work harder and have a pernicious effect on the economy. Hume 's contribution includes devising a science of commerce by identifying causal relations. He believed that in economic inquiry we have the means to venture deeply into the internal causes of the relevant