Gavin Kennedy, emeritus professor at Edinburgh’s Heriot-Watt University and blogger at Adam Smith’s Lost Legacy, is upset (May 23 entry) that Knowledge and the Wealth of Nations doesn’t do justice to the subtley of the views of Adam Smith. It most certainly does not. But then that is not what the book is about.
What it is about – how formal methods, mathematics in particular, have enabled economists to move beyond the ambiguities in the work of early literary economists, Smith in particular, to a demonstrably clearer understanding of the world — Kennedy airily dismisses with a wisecrack. “Of the controversies over the maths of competing economic growth theories, I shall say nothing. Like the sex life of a rhinoceros, they are of compelling interest only to other rhinos.”
I am more interested than most in Smith’s genius — did he or did he not actually visit a pin factory? — but from the first word of its title on, Knowledge and the Wealth of Nations is about knowledge, meaning all that has been grasped by the human mind, and the effect of its growth on human well-being. The punchline, derived from mathematical economics, is that the economics of knowledge differs profoundly from the economics of things (and, for that matter, of skilled people), in that knowledge is nonrival: it can be copied and used in many different activities and by many different people at the same time.
A great deal of wisdom is to be found in Adam Smith, but not that.