Adam Smith is a Scottish economist and philosopher who was born in an area called Kirkcaldy in the year 1723. However; his actual date of birth is unknown. His father died when he was still a young boy, but his mother ensured he went to school. He performed quite well in school. His main areas of study were Latin, history, and mathematics. His exemplary performance earned him a scholarship at the University of Glasgow to study moral philosophy. He continued excelling in university and obtained another scholarship to study in Ballion College at the Oxford University. However, after a short period of study, he dropped out of the College because he regarded the studies as inferior (Heilbroner, 2016).
Smith started giving public lectures in 1749 in Scotland. Philosophical Society of Edinburgh mainly sponsored the lectures. In his fist few years, he lectured philosophical topics like rhetoric and belles-lettres. He later changed and started lecturing economics where he mainly advocated for capitalism economy driven by natural liberty. His philosophical and economic lecturers gained a wide reputation. Thus, Glasgow University appointed him as professor of logic in 1751. One year later he was transferred to chair moral philosophy. During his stay in the university, he lectured on rhetoric, ethics, and political economy. His highest achievement in the university was attained by publishing the theory of moral sentiments in 1759 that earned him doctors in laws. His economic lectures discredited mercantilism and promoted the use of labor to create wealth (Lisa, 2008).
He left Glasgow University after getting a lucrative post of tutor in Young Duke. In the course of his work, he wrote on the concept of the wealth of nations. According to him, society generates wealth as everyone works per self-interest to accumulate personal wealth. The self-interest drive makes people work hard and produces commodities required by the rest of the society. In the society, people specialize in producing different commodities. Thus, a butcher purchases from baker and baker from the farmer and the circle goes on. Producers increase the scale of production over time and can employ workers in their firms. This concept gave birth to the school of thought that is currently regarded as classical economics(Pettinger, 2013).
His economic ideas promoted minimum government interference in the market. This allows forces of demand and supply to determine the market price of commodities. The resources in the society are allocated in the best way because entrepreneurs seek to venture in sectors where they can get high returns. Smith encouraged entrepreneurs to adopt the division of labor to produce high volume and quality output at a low cost. Currently, the division of labor is used in various industries across the globe. The high-quality output is achievable because workers gain expertise in a small section of the entire production process. Thus, they can work at a fast rate without making major errors.
Smith died on 19th July 1790. However, his economics ideas have formed the basis classical economics. The Bank of England acknowledged this economics contribution by placing his image on the £20 note in 2007 (Pettinger, 2013).
References
Heilbroner, R. L. (2016, March 3). Adam Smith. Retrieved May 19, 2016, from
http://www.britannica.com/biography/Adam-Smith
Lisa, S. (2008). Adam Smith: The Father Of Economics | Investopedia. Retrieved May 17, 2016,
Pettinger, T. (2013, October 3). Division of Labour. Retrieved May 19, 2016, from
http://www.economicshelp.org/blog/glossary/division-of-labour/
