Adam Smith

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the goods. This is how the market worked at Smith’s time. However, the flaws with this theory are apparent in the examination of modern society.The second book that wrote was titled An Inquiry into the causes and Nature of the Wealth of Nations. It is believed to be a guide to the formulation of most governmental economic policies today. Its main thesis is that capital is best employed for the production and distribution of wealth with the government interfering as little as possible. Throughout this book, Smith stated his main theory. This theory was later known as economic liberalism. Smith believed in the term laissez-faire, which is French for hands off. Smith believed that there should not be any government intervention with the people except for only three cases. The only circumstances where the government should be able to intervene are with defense, justice, and certain public works. In Smith's view, the production and exchange of goods can be stimulated, and a rise in ...

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