On April 26, in 1759, Adam Smith published The Theory of Moral Sentiments. It was an instant sensation. Since the Greeks, philosophers had tried to work out the basis of human ethics: what it was that made some actions good and others bad. Many, in the age of Enlightenment, thought there must be some rational, logical explanation, and perhaps even some way of measuring the goodness or badness of an action, almost mathematically. Such efforts did not lack ingenuity, but never met with great success.
Smith's breakthrough was to see ethics as an issue of social psychology. It was not something inherent in actions themselves that made them good or bad. It was how they affected other people, and how other people reacted to them. Because we are social beings, Nature has equipped us with a powerful empathy (Smith calls is sympathy) with other people. When we see them suffering, we are distressed; when we see them overjoyed, we share some of their happiness. This natural empathy steers us towards action which benefits our fellows, and causes us to approve of it; likewise it steers us against damaging action, and prompts our disapproval of such action.
Writing exactly a hundred years before Darwin's Origin of Species, Smith lacked evolutionary theory; yet he knew that, for some providential reason, Nature encouraged socially beneficial action. He knew that if she had not, our species would not have lasted so long. He understood the mechanism, if not the biology.
Smith's book made him famous. And rich: a prominent admirer of the book instantly hired him to act as personal tutor to his ward, the young Duke of Buccleuch, with a salary payable for life. His travels with the young Duke, and the thinking time that this new wealth gave him, enabled Smith to expand his ideas on politics and finance into a new book, The Wealth of Nations. The rest is (economic) history.
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