Adam Smith

Adam Smith is remembered as the prophet of the free market, which would have puzzled him, because he thought of himself as a professor of moral philosophy – which is what he was, in the chair at Glasgow, for thirteen years. His first book was not about money at all. The Theory of Moral Sentiments asks how a creature as selfish as man comes to make moral judgments, and answers: through sympathy, the imaginative act of standing in another's place and feeling with him.

Out of that grows his subtlest idea. We learn to judge ourselves by imagining how a fair and well-informed onlooker would see us – the impartial spectator within the breast, a conscience built out of the eyes of others. Long before he wrote a word about commerce, Smith had described the moral world as one held together by the wish to be, and to deserve to be, approved of.

The Wealth of Nations then made the case that a market is an order no one designed. Each person pursuing his own gain is led by an invisible hand to promote an end that was no part of his intention – bread reaches the city not through the baker's benevolence but through his interest. Yet Smith was no cheerleader. He warned that the same division of labour that makes nations rich can make the labourer as stupid and ignorant as it is possible for a human creature to become, his mind narrowed to a single motion, and he demanded public schooling to answer it. Prosperity, for Smith, was a moral achievement resting on trust and law, not the law of the jungle. He died as he had lived, decently; a few years earlier he had sat at the bedside of his closest friend, David Hume, and watched an unbeliever meet death with a serenity that scandalised Christian Britain.