Markets, Productivity, and Happiness in a Historical Perspective

Happiness in Adam Smith

Nohara Shinji, University of Tokyo

This presentation considers how Smith thought about happiness by examining his relationship with moralists. Smith, in a sense, disagreed with moralists' view of happiness, because they did not believe that people's prosperity made them happy. In contrast, Smith insisted that prosperity did bring happiness. Nonetheless, Smith himself agreed with the moralist view that material prosperity is not a source of true happiness. In this regard, Smith might have been inspired by moralists. This moralistic denial of material prosperity as true happiness influenced his depiction of human behavior and society, not only in The theory of moral sentiments (TMS) but also in his Inquiry into the nature and causes of the wealth of nations (WN). In TMS, Smith made it clear that one's view of happiness is connected to the economy. People are motivated to improve their condition by working hard. This industry can make an economy grow. Nonetheless, he denied that bettering one's condition makes one truly happy. In this point, Smith affirmed the moralists' view. Because most people cannot understand that kind of happiness, they are motivated by the "wrong" view of happiness. This double view of happiness reminds us of moralists' understanding of happiness in which, although material prosperity does not constitute true happiness, most people want to be prosperous. People failed to understand the true happiness because they are more influenced by sentiments than by reason. This failure of reason is also similar to moralists. Based on his moralistic understanding of the relationship between reason and sentiment, Smith described human nature and behavior in WN. In WN, he repeatedly denied that, although politicians insisted that they were acting in the public interest, they were not actually doing so. Smith saw politicians, unlike ordinary citizens, not as those who should be controlled by reason. Like moralists, Smith did not believe that most politicians were controlled by reason. This failure of reason affected human behavior in economy. Despite that, Smith still considered public virtue important for the good of society. As J. G. A. Pocock insisted, in the early modern era, public virtue was inspired by civic humanism or republicanism. However, what Pocock and other scholars tended to ignore was that public virtue was also advocated by Montaigne and other moralists. Many of them were critical of most politicians' ability to practice public virtue but he still believed in its importance. This moralistic understanding of virtue influenced Smith's view of human nature.


Keywords: Adam Smith, happiness, virtue, morality

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