48 pages • 1 hour read
Adam SmithThe Wealth of Nations. The Theory of Moral Sentiments
Nonfiction | Book | Adult | Published in 1776A modern alternative to SparkNotes and CliffsNotes, SuperSummary offers high-quality Study Guides with detailed chapter summaries and analysis of major themes, characters, and more.
Book 3Chapter Summaries & Analyses
Book 3: “Of the Different Progress of Opulence in Different Nations”
Book 3, Chapter 1 Summary: “Of the Natural Progress of Opulence”
Smith believes the natural progress of economic growth to be a reciprocal relationship between the country, whose primary economic activity is agriculture, and towns, which consist of artisans who make tools and household goods for farmers. Both groups need each other, but agriculture must develop first, as it is the primary and original source of economic activity. Smith states this natural development—beginning with the growth of agriculture and progressing into manufacturing performed in the towns—is one that would arise in a market free of interference. This is partly because land is a more secure investment than manufactures or trade. Smith reasons that the country supplies towns with “means of substance and the materials of manufacture,” and the town repays the country with manufactured produce” (121).
Smith explains further that this exchange does not have a winner or a loser, but rather that it is reciprocal. Smith concludes, however, that towns have followed an unnatural course by growing more rapidly than rural areas. He also comments that more resources have been devoted to manufacturing than naturally should have been. Smith argues this is the result of government interference through laws. He adds, “According to the natural course of things, therefore, the greater part of the capital of every growing society is, first, directed to agriculture, afterwards to manufactures, and, last of all, to foreign commerce” (122).
Smith believes an agrarian economy to be the most natural and the best for building national wealth. Throughout his text, it can be observed that Smith advocates for what is natural as what is best, and frequently cautions against interfering or manipulating the natural order. This, however, does not mean that Smith is against manufacturing or foreign trade. He simply believes national economies must develop in a certain order, and that a nation cannot progress to manufacturing until they have developed their agrarian economy, and that a nation cannot then progress to foreign trade until they have a surplus of goods from their agrarian and manufacturing industries.
Book 3, Chapter 2 Summary: “Of the Discouragement of Agriculture in the Ancient State of Europe, After the Fall of the Roman Empire”
Smith details the history of governmental discouragement of agriculture after the fall of the Roman Empire. He argues that for centuries, towns were given legal and economic advantages, while rural agrarian economies were discouraged from production. Smith’s argument is that towns achieved freedom prior to rural areas, and gained advantages over rural areas through allegiances with weak kings. His conclusion is that, “Under all these discouragements, little improvement could be expected from the occupiers of land” (126).
Smith makes an argument in favor of agrarian economies and against unnatural benefits being given to towns, but he does not place the blame on towns themselves. Rather, Smith argues that the unnatural system that developed following the fall of the Roman Empire is the fault of rich rural landowners engrossing themselves through monopolies of land. Smith places much of the blame on male-preference primogeniture and entail for creating the systems of power struggle, which led to weak kings preferencing towns over rural areas. Smith will later relate such arguments to his critique of mercantilist monopolies supported by British law.
Book 3, Chapter 3 Summary: “On the Rise and Progress of Cities and Towns, After the Fall of the Roman Empire”
Here, Smith details the encouragement of towns following the fall of the Roman Empire. He states, “But how servile soever may have been originally the condition of the inhabitants of the towns, it appears evidently, that they arrived at liberty and independency much earlier than the occupiers of land in the country” (126). Medieval kings struggled for power with wealthy rural landowners, and consequently made alliances with townspeople, who feared the wealthy rural landowners. This relationship provided for privileges to townspeople granted by kings in return for their allegiance. These privileges caused towns to prosper and gain a degree of independence, maintaining their own courts and militias. Over time, towns continued to prosper while rural areas continued to decline. This, Smith argues, is what led to the current unnatural disparity between agrarian economies and manufacturing economies.
Book 3, Chapter 4 Summary: “How the Commerce of Towns Contributed to the Improvement of the Country”
Smith asserts that the commerce of towns contributed to the improvement of the country in three main ways. First, towns provide a market for the produce of the country, and in doing so encouraged the cultivation and improvement of land. Second, townspeople frequently used their acquired wealth to purchase and cultivate country land. Third, the development of towns, commerce, and manufactures introduced formal government, liberty, and individual security to all inhabitants, including those of the country, who previously “lived almost in a continual state of war with their neighbours, and of servile dependency upon their superiors” (130).
This, Smith argues, caused the prosperity experienced in towns to spread to rural areas as well, over time. However, Smith still maintains that this order of gaining prosperity—town first, rural second—is contrary to natural law. As evidence, Smith references North America, where no primogeniture laws exist, and the population doubles every quarter century while economic progress abounds.
