Adam Smith's Problems: The Theory of Moral Senses and The Wealth of Nations

Adam Smith was an economist that engraved his name in the 1700s. He is known as the FATHER of Economics. Nobody truly knows when he was born, but we know that he was baptized in 1723. At this point, Benjamin Franklin, George Washington, and Napoleon Bonaparte were all alive. He died in 1790. Throughout the years we knew for sure he was alive, he had heard of the Seven Years’ War, The Stamp Act, The Boston Massacre, The Boston Tea Party, The American Revolution, The Declaration of Independence, the creation of the Constitution, and the French Revolution.

He lived in a very monumental period, and he was one of the reasons why the period was so prodigious. Let’s dig a little deeper.

During his life, Smith made many contributions. One of the contributions he made was getting the education he needed to continue with all his work. He went to the University of Glasgow and Oxford. Later in life, he published the books “The Wealth of Nations”, “The Theory of Moral Sentiments”, “Lectures on Police, Justice, Revenue, and Arms”, and “The Essay on Philosophical Subjects”.

Later, towards his death, he ended up being the head of a school. Smith had taken to a very educational career. Now let’s look at his biggest achievement.

The biggest contribution to Economics Adam Smith made during the immensely busy period was his book “The Wealth of Nations”. In this book, Adam Smith explains that countries are measured by how much money they had rather than what they produce and how much they buy or sell.

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He then goes on to explain that free trade should be happening. He said capitalistic economies are better for the people because it allows consumers to take charge of what they consumed rather than settle for what the government gives them. This is what’s known as the invisible hand. It would be helping poorer people because they then have the choice to choose cheaper options rather than go hungry, and wealthier people have the option to buy quality items. This was a huge step forward for the economies all around. Now that we’ve finished up Adam Smith, let’s hear about Milton Friedman an economist from a completely different time.

Unlike Adam Smith, Milton Friedman was born in the United States. He too was a well-educated man. He went to college for Math and Economics, and later he went further on and got a Ph.D. in Economics. He ended up having various jobs such as figuring a budget for the Natural Resource Committee, he did some work in the health field regarding wages, he also worked in the Department of the Treasury working in tax research, and he worked for a university where he did war research.

Milton was a very busy man. Among his many jobs, he also had time to put his two senses into the world. Wrote “A Theory of the Consumption Function” and it was one of his earliest works. He was a huge advocate for Monetary Economics. He wrote a few articles in response to the Keynesian Model. He ended up co-writing a few books in regards to the Great Depression. Friedman then continued the battle with the Keynesians and therefore ended the rein of the Keynesian Model being superior. Milton ended up retiring not too long after his controversy with the Chilean government. That was about the time he co-wrote a book with his wife. Now that I’ve shared all of his work, it’s time to go more in-depth.

Milton’s best work would have to be the work against the Keynesian Model altogether. He was very forward about his opinion from start to finish. His theory regarded money to control all together while the Keynesian Model was talking about government costs. Milton believed that if you gave the money to the people, the consumers would have fixed the economy without the interference of the government whereas the Keynesian Model was the opposite. He fought long and hard and, in the end, he gave reason to everyone to understand more about the free market economy. To this day, there are still thoughts on whether the Keynesian Model or the Monetary theory was better.