What Were Adam Smith’s Contributions to Economics?
Adam Smith’s main contributions to the field of economics were to lay the conceptual foundations for measuring a nation’s wealth not by its gold or silver reserves but by its levels of production, and also to champion free-market capitalism as the most effective economic system. Smith was very much in favor of a laissez-faire approach to economies, wherein governments intervene as little as possible in business practices and trade.
In other words, Smith was in opposition to government policies that impacted upon the freedom of business, and therefore upon a country’s economic health.
Although he advocated self-interest as a driving force in capitalist economies, Smith was against the poor treatment of workers — despite many unscrupulous employers appealing to his work as justification of child labor, long hours and unsafe working conditions. In fact, according to one of his students, John Millar, Smith much preferred to lecture on ethics and theology than he did on economics.
Adam Smith’s most important work was his 1776 book, “An Inquiry into the Nature and Causes of the Wealth of Nations.” More commonly known as “The Wealth of Nations,” this text has been hugely influential, not only during his own time but right up to present day studies of political economics.