This paper traces missing links in the history of economic thought. In outlining Hume's concept of 'the reflexive mind' it shows that this opened frontiers between philosophy and psychology which Bertrand Russell denied and which logical positivism in philosophy and positive economics displaced. It relates this to Hume's influence not only on Smith, but also on Schopenhauer and the later Wittgenstein, with parallels in Gestalt psychology and recent findings from neural research and cognitive psychology. It critiques Kant's reaction to Hume's (...) claim that one may assume but cannot prove cause and effect and how Samuelson's Foundations of Economic Analysis has been Kantian but wrong in claims for axioms that are universal truths. It illustrates how Samuelson's presumption that language and mathematics are 'identical' was as mistaken as the logical atomism of Russell and the early Wittgenstein, relates this to Kleinian splitting, denial and projective identification and suggests that recovery of greater realism in economics needs to regain links with such philosophy and psychology. (shrink)

Adam Smith's ethics have long been thought to be much closer to the Stoic school than to any other school of the ancient world. Recent scholarship however has focused on the fact that Smith also appears to be quite close to Aristotle. I shall attend to Smith's deployment of a version of the doctrine of the mean, shall show that it is quite close to Aristotle's, shall demonstrate that in its detailed application it is seriously at odds with Stoic teaching (...) on the passions, and particularly with their teachings on anger, and shall conclude that on a central issue of ethics Smith is a good deal closer to Aristotelian than to Stoic thinking. (shrink)

ABSTRACTIf war is an inevitable condition of human nature, as David Hume suggests, then what type of societies can best protect us from defeat and conquest? For David Hume, commerce decreases the relative cost of war and promotes technological military advances as well as martial spirit. Commerce therefore makes a country militarily stronger and better equipped to protect itself against attacks than any other kind of society. Hume does not assume commerce would yield a peaceful world nor that commercial societies (...) would be militarily weak, as many contemporary scholars have argued. On the contrary, for him, military might is a beneficial consequence of commerce. (shrink)

The paper is aiming to present and analyse the notions used by Adam Smith: ‘instinct’ and ‘ appetites’. They appear in two of the Scottish philosopher’s works: in ‘The Theory of Moral Sentiments’ and in an essay ‘ Of the External Senses’. Smith noticed that there are certain inborn mechanisms that suggest the existence of crucial needs and means leading to satisfy those needs. That concerns, mostly, hunger and thirst, but also sex drive. He regarded the need of self-preservation and (...) of caring for one’s own well-being as crucial for a man’s behaviour. The essay ‘ Of the External Senses’ mentions instinctive correlation of the objects of sight with the objects of touch as crucial for the human survival, basing on George Berkeley’s theory of vision. Smith’s remarks on appetites give a new perspective on how the mechanisms given us by Nature influence moral and social individuals, at the same time completing the philosopher’s theory. The need to care for self ’s prosperity and survival can be regarded not only as an instinct, but also as actions leading to realisation of the virtue of prudence. Moreover, we learn how to fulfil our instinctive needs and appetites within the society, searching for acceptable means. In the paper Smith’s view of instincts and appetites is also being briefly confronted with David Hume’s and Thomas Hobbes’ remarks on the subject. (shrink)

This paper explores the presence of both relativistic and universalistic elements in Adam Smith’s moral philosophy. It argues that Smith is more sympathetic to the concerns of anthropologists than most philosophers have been, but still tries to uphold the possibility of moral judgments that transcend cultural contexts. It also argues that the tensions between these aspects of his thought are not easy to resolve, but that Smith’s sensitivity to the issues that give rise to them makes him a useful figure (...) with whom to think through the relationship between anthropology and moral philosophy to this day. (shrink)

Motivation crowding out can lead to a reduction of ‘higher’ virtues, such as altruism or public spirit, in market contexts. This article discusses the role of virtue in the moral and economic theory of Adam Smith. It argues that because Smith’s account of commercial society is based on ‘lower’ virtue, ‘higher’ virtue has a precarious place in it; this phenomenon is structurally similar to motivation crowding out. The article analyzes and systematizes the ways in which Smith builds on ‘contrivances of (...) nature’ in order to solve the problems of limited self-command and limited knowledge. As recent research has shown, a clear separation of different social spheres can help to reduce the risk of motivation crowding out and preserve a place for ‘higher virtue’ in commercial society. The conclusion reflects on the performative power of economics, arguing that the one-sided focus on models of ‘economic man’ should be embedded in a larger context. (shrink)

Other-perspective taking, distancing, time discounting as well as risk and loss aversion highly affect decision-making. Even though they influence each other, so far these cognitive processes have been unrelated or only partly related to each other in neuroscience. This article proposes a philosophical interpretation of these cognitive processes that is elaborated in the updated theory of Adam Smith’s prudence. The UTSP is inspired by Smith’s account of prudence and is in line with the neuroscientific and behavioral studies on OPT, distancing, (...) time discounting as well as risk and loss aversion. The UTSP represents a framework aiming to interpret and connect these cognitive processes and providing a consistent and empirically sound account of a “Smithianly” prudent style of decision-making. The two pillars of the UTSP are the shift of perspective in space and time and loss aversion. On the basis of this theory, a normative updated theory of Smithian prudence is outlined. The latter is useful for moral philosophy for two reasons: firstly, according to preliminary evidence, it is effective in guiding the agent in decisional contexts in which her well-being is at stake and she can affect other people with her actions. Secondly, since the NUTSP is based on neuroscientific findings on decision-making, it has a sound empirical basis that prevents a source of alienation for the agent. (shrink)

There is no room for the concept of need in the prevailing neoclassical school of economics. Not so, however, in classical political economy. Through close analysis in this paper, I wish to trace the concept’s prominence in Adam Smith’s thought and to fine-tune its definitional aspects. The thrust of Smith’s argument is to delineate the mechanism via which the needs of the poorest in society are satisfied. Grounded in an understanding of need as limited and exhaustive rather than infinite, like (...) desire or preference, his theory is one of affluence rather than scarcity. But his justification of commercial society (from which the neoclassical school only lifts the conclusion) rests on becoming actually satisfied that these needs are, indeed, satisfied—an erroneous belief (at least according to the terms of Smith’s own definition) and an internal contradiction in the development of his argument, occasioned, I wish to suggest, by certain colonialist discourses. Finally, Smith’s ontology of need, as reconstructed here, corresponds to similar enquiries recently undertaken in philosophy and in some heterodox schools of economics. (shrink)

There is long-standing disagreement about how radical Adam Smith should be taken to be. Recently, Jonathan Israel’s work on the enlightenment situates Smith as a moderate enlightenment thinker. This article challenges that assessment. Smith sees aristocrats as largely devoid of competence, wisdom, and virtue and thinks they do not wield significant political power in commercial societies. He is also highly critical of their economic power; and uses a neo-Roman concept of liberty to provide a powerful critique of slavery and feudalism. (...) In so doing, he extends discussions of liberty and focuses them on economic relations in ways that prefigure labour republicanism. Finally, I show how these more radical commitments can be reconciled with his moderate proposals for political reform through his epistemology and realist anti-utopianism. These are aspects of Smith’s thought that are essential for understanding it correctly and have much to teach us today. (shrink)