Entrepreneurship, knowledge and employment

Providence, virtue and happiness in Adam Smith's view of commercial society

Verburg Rudi, VU Amsterdam

Theology and economics, markets and crowding-out effects, and happiness and economics are topical subjects in economics. On all three subjects historians of economic thought have traced the origin of these topics and Adam Smith figures prominently in all. It is far less recognised, however, that in Smith these topics are intimately related and essential parts of his overall system of thought. This paper aims to show how Smith knitted providence, virtue and happiness together and argues against any one-track perspective on Smith’s views as is often observed in the secondary literature: secularism versus providentialism, the crowding-out of virtue by impersonal market forces versus the crowding-in effect of commerce and exchange relations, and happiness as human flourishing versus happiness as the pleasure of wealth. Taking these topics in turn in three successive sections, the paper aims to show that Smith sought to dig into patterns of interaction and influence between contending forces rather than argue for any one-sided position. Although Smith’s work does exhibit a benign, providentialist thrust, societal tendencies resulting from contending forces may go different ways, depending on the choices people make and the institutions which develop for guidance, whereby moral growth and human flourishing in commercial society are always precarious.

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Keywords: Adam Smith, commercial society, virtue, happiness, providence

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