“ I see trees of green, red roses too, I see them bloom, for me and you, And I think to myself what a wonderful world.” This excerpt from a popular song by Louis Armstrong describes an environment of organic beauty. In which, surrounded by the simplistic splendor of nature, Armstrong sees a “wonderful world”. For as long as history records, humankind has attempted to find some form of this “wonderful world” and while many seek it, few agree on what factors contribute to a fully wonderful world. Adam Smith, for example, envisioned a very different route to achieving his wonderful world. In Smith’s conception of society: harmony, development, and beneficence could only be achieved through an unrestricted market. Smith, in perhaps one of his most famous works—Wealth of Nations, explained how the market works and argues that the market is the mechanism that establishes both the cohesion and improvement of society.

Adam Smith methodically describes how the market operates and the primary force responsible for it’s perpetuation—self interest. In Wealth of Nations, Smith describes how self-interest motivates suppliers to produce. Robert L. Heilbroner writes, “…Self int

Smith’s solution to this problem is his second law, the Law of Population. As Heilbroner avers, “Higher wages will bring about a higher number of workers, and the increase in their numbers will set up reverse pressure on the level of their wages.” (Pg 65). Meaning that when there are higher wages for workers, more workers will be willing to work. And once that happens the demand for workers decreases and thus, the wages auto-correct themselves. However this did not yield positive results in all circumstances. As Smith asserts“…the demand for men, like that for any other commodity, necessarily regulates the production of men.” (Pg 65). Under Smith’s ideals, these men would be produced as a result of expanded industry. This may seem to be a somewhat spurious correlation on the surface. However, if examined more closely, it is clear to see how this worked. During Smith’s time there was a very high infant mortality rate. As Smith put it, “It is not uncommon…in the Highlands of Scotland for a mother who has borne 20 children not to have two alive.” (Pg 65). Smith theorized that as a result of factory expansion, employment would increase. More jobs would than lead to better living conditions. And better living conditions would inevitably result in less infant mortality rates. When inspecting this fact, it is clear that Smith believed, to a degree, that the lower classes’ lives would be improved as a result of a pure market system.

Smith demonstrates that competition between merchants will ensure reasonable prices and the production of goods that the public desires. As Heilbroner comments, “…if he charges too much for his wears or refuses to pay as much as everybody else for his workers, he will find himself without buyers in the one case and without employee’s in the other” (Pg 55). Indeed, the selfishness of man absolutely ensures that non-producers are given economical prices for their goods and fair wages for their work. It is interesting to note that in this circumstance the egotism of man actually contributes to fair prices. Heilbroner expounds on this concept saying, “Selfish motives of men are transmuted by interaction to yield …social harmony” (Pg 56).

Adam Smith did not believe in hands off government, but instead believed that the government should keep it’s “hands off” the market. Smith saw that the government was essential in performing certain tasks, such as education, defense and the construction of roads. However, Smith believed that the government had no right in regulating the market, because to do so would interrupt the market mechanisms. As Heilbroner elucidates, “ He (Smith), is against restraints on imports and bounties on exports against government laws that shelter industry from competition…” (Pg 69). Therefore, when people claim that Smith is completely against government action, they are not enti

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