Adam Smith and the Major Concepts in the Wealth of Nations Describe the ideas of Adam Smith in detail

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Laissez-Faire“What is the species of domestic industry which his capital can employ, and of which the produce is likely to be of the greatest value, every individual, it is evident, can , in his own location, judge much better himself than any statesman or lawgiver can do for him.”Smith promotes laissez-faire in saying that individuals know their own interests and how to employ their own capital better than any outside authority. Also any government official, senator, etc… would be too burdened with work if they were to direct private capital, and also untrustworthy of dealing with private capital. Smith argues for the market to be regulated by individual self-interest, competition, and supply and demand. If the market were to work this way the system would work dynamically. Individuals would buy the goods they wished. The producer of the good would work to make the production as efficient as possible to drive down costs, and would sell goods being demanded.

“It is not from the benevolence of the butcher, the brewer or the baker, that we expect our dinner, but from their regard to their own self interest. We address ourselves, not to their humanity but to their self-love, and never talk to them of our own necessities but of their advantages.”In laissez-faire the ideal outcome would be a self regulating market fueled by self-interest which unintentionally promotes a general good. Regulating the system would interfere with the preferable ideal outcome. Smith distrusts the ability of government to regulate the market in any direction. He goes on to say, “The statesman who should attempt to direct private people in what manner they ought to employ their capitals would not only load himself with a most unnecessary attention, but assume an authority which could safely be trusted”Invisible Hand“Every individual necessarily labors...