Adam Smith’s “The Wealth of Nations” Turns 250 + Free Markets Face Off Against Industrial Policy

The Hook: Adam Smith’s The Wealth of Nations, the book largely credited as the foundation for modern economics, marks its 250th anniversary.

The Spillovers: Smith’s book is a timeless lens through which to consider economic trends, spanning its push to reduce regulation and encourage free markets, to increased government intervention in the name of national security. Specialization and global supply chains continue to be powerful engines of wealth, creating both efficiencies and, at times, surprising resilience through diversified sourcing. Smith’s insight that self-interest can serve the common good still holds, but only when tempered by morality and protected by the rule of law, without which markets cannot function properly. Finally, his warning about merchants seeking government favors endures, reminding readers that cronyism undermines competition and rarely benefits society at large. 

The Spillover is a production of the Council on Foreign Relations. The opinions expressed on the show are solely those of the hosts and guests, not of the Council, which takes no institutional positions on matters of policy. 

Mentioned on the Episode: 

“Adam Smith is Misinterpreted and His Influence Overstated,” Economist

Gita Gopinath, “Geopolitics and its Impact on Global Trade and the Dollar,” International Monetary Fund (IMF) 

Caitlin Oprysko, “Trump’s Return Supercharges Lobbying Revenues,” Politico