# An Outline of the History of Libertarian Thought, Part III: The Scottish Enlightenment **URL:** **By** David Hart **Published:** September 1, 1983 --- “Adam Smith’s economic theories were to have a profound effect on both liberal thought and government policy in the nineteenth century, particularly in France and England.” ## VII. The Scottish Enlightenment ## Recommended Reading Jane Randall, _The Origins of the Scottish Enlightenment 1707-1776_ (London: Macmillan, 1978). Andrew Skinner, “Adam Smith: An Economic Interpretation of History,” in A.S. Skinner and T. Wilson eds., _Essays on Adam Smith_ (Oxford: Clarendon Press, 1975). Peter Stein, “Adam Smith’s Theory of Law and Society,” _Classical Influences on Western Thought, 1650-1870_ (Cambridge University Press, 1979), pp. 263-73. Donald Winch, _Adam Smith’s Politics: An Essay in Historiographic Revision_ (Cambridge University Press, 1979). T. D. Campbell, “Adam Smith and Natural Liberty,” _Political Studies_, 1977, XXV, 4, pp. 523-34. Jacob Viner, “Adam Smith and Laissez-Faire,” in _The Long View and the Short: Studies in Economic Theory and Policy_ (New York: The Free Press: 1958), pp. 213-45. The Scottish Enlightenment of the eighteenth century is one of the more remarkable periods in the development of liberal ideas. It was here that political economy as a discipline came of age with the magnificent work of Adam Smith: _An Inquiry into the Nature and Causes of the Wealth of Nations_ (Indianapolis: Liberty Classics, 1981), ed. R. H. Campbell and A. S. Skinner. The Scottish Enlightenment also made incalculably important contributions to the study of history, sociology, legal theory, moral philosophy, and the science of politics. A small measure of its value can be seen from the quite palpable influence it has had on Friedrich Hayek, one of the leading classical liberal writers of the twentieth century. One need only look at Hayek’s three volume treatise _Law, Legislation and Liberty: A New Statement Of the Liberal Principles of Justice and Political Economy_ (University of Chicago Press, 1973-1979) to get some idea of the Scottish influence on his social and legal philosophy (from David Hume) and his idea of spontaneous order (from Adam Ferguson). A good place to begin sorting through the huge literature dealing with the Scottish Enlightenment is the short essay by Nicholas Phillipson, “The Scottish Enlightenment,” _The Enlightenment in National Context_ (Cambridge University Press, 1981), ed. Roy Porter and Mikulas Teich, pp. 19-41, and the collection of extracts edited by Jane Randall, _The Origins of the Scottish Enlightenment 1707-1776_ (London: Macmillan, 1978). For a more detailed treatment, concentrating on the economic and legal aspects of the Scottish Enlightenment, see the collection of essays _Wealth and Virtue: The Shaping of Political Economy in the Scottish Enlightenment_ (Cambridge University Press, 1983), ed. Istvan Hont and Michael Ignatieff. For the best collection of essays about Adam Smith and his contribution to the Scottish Enlightenment, see _Adam Smith: Critical Assessments_ (London: Croom Helm, 1984), 4 vols., ed. John Cunningham Wood. ## Hutcheson In many ways the Scottish Enlightenment began with the moral philosophy of Francis Hutcheson who interpreted the seventeenth century natural jurisprudence tradition of Grotius and Pufendorf for a new generation of thinkers. Hutcheson’s _A System of Moral Philosophy_ (1755) contains many social, legal, and economic insights which were developed in much greater depth later in the century by writers such as Adam Ferguson, Lord Kames, John Millar, William Robertson, and Adam Smith. The other major pioneer of the Scottish Enlightenment was David Hume whose contributions to social philosophy and history were immense. On Hutcheson, see W. L. Taylor, _Francis Hutcheson and David Hume as Predecessors of Adam Smith_ (Durham, NC: Duke University Press, 1965) and Caroline Robbins, “When is it That Colonies May Turn Independent: An Analysis of the Environment and Politics of Francis Hutcheson 1669-1746,” _William and Mary Quarterly_, 1954, 11, pp. 214-51. On Hume, see Duncan Forbes, “Politics and History in David Hume,” _Historical Journal_, 1963, 6; Duncan Forbes, _Hume’s Philosophical Politics_ (Cambridge University Press, 1975); Friedrich Hayek, “The Legal and Political Philosophy of David Hume,” in _Studies in Philosophy, Politics and Economics_ (University of Chicago Press, 1969); Eugene Rotwein, _David Hume: Writings on Economics_ (Madison: University of Wisconsin Press, 1970). > “each (man) has a natural right to exert his powers, according to his own judgment and inclination, for these purposes, in all such industry, labour or amusements, as are not hurtful to others in their persons or goods. . . . This right we call natural liberty.” > > “Mankind have generally been a great deal too tame and tractable; and hence so many wretched forms of power have always enslaved nine-tenths of the nations of the world, where they have the fullest rights to make all efforts for a change.” Francis Hutcheson ## Historical \& Sociological Contributions Although the Scottish Enlightenment is probably best remembered for its contribution to economic theory, it also made fundamental contributions to history and sociology. For the first time, the categories of economic analysis were applied in a systematic manner to the study of history and social institutions to create what was known as “Theoretical or Conjectural History.” For example, it was observed that the ancient world and the recently discovered aboriginal societies of North America had very different economic and social structures from the more commercial societies of eigthteenth century Europe. Lord Kames in his _Historical Law Tracts_ (1758), Adam Smith in his “Letter to the Authors of the _Edinburgh Review_” (1755), Adam Ferguson in _Essay on the History of Civil Society_ (1767), and William Robertson in _History of America_ (1777) developed a sophisticated theory of historical change based upon the structure of property rights and the particular means of production in each of the different societies to explain the varying degress of economic progress. On the history of what is known as the “four stages theory” of economic development, see Ronald L. Meek, _Social Science and the Ignoble Savage_ (Cambridge University Press, 1976). ## Class Analysis Related to the development of their historical understanding was the creation of a theory of class. Adam Ferguson and John Millar are the most interesting precursors of modern sociology in this period. In Ferguson’s _An Essay on the History of Civil Society_ (Edinburgh University Press, 1965) ed. Duncan Forbes, and Millar’s _The Origin of the Distinction of Ranks_ (reprinted in Lehmann, _John Millar of Glasgow_, cited below, pp. 165–322) and _An Historical View of the English Government_ (London, 1803), ed. J. Craig and J. Mylne the idea that political privilege, based upon one’s social or economic position, is a determining factor in explaining the history and development of political power. Marxists like Ronald Meek have seized upon this aspect of Scottish thought as an early presentiment of the materialist theory of history. However, a closer examination of Ferguson and Millar reveals their liberal inclinations and the importance they placed on non-economic (i.e. political) forms of privilege. On the class analysis and general sociological theory of the Scottish Enlightenment, see David Kettler, _The Social and Political Thought of Adam Ferguson_ (Ohio State University Press, 1965); William C. Lehmann, _John Millar of Glasgow, 1735–1801, his Life and Thought, and his Contribution to Sociological Analysis_ (Cambridge University Press, 1960); William C. Lehmann, _Adam Ferguson and the Beginnings of Modern Sociology_ (Columbia University Press, 1930); William C. Lehmann, “John Millar, Historical Sociologist: Some Remarkable Anticipations of Modern Sociology,” _British Journal of Sociology_ 3, 1952, pp. 30–46; A. Swingewood, “Origins of Sociology: The Case of the Scottish Enlightenment,” _British Journal of Sociology_, 1970, 21, pp. 164–80; D. A. Reisman, _Adam Smith’s Sociological Economics_ (New York: Barnes and Noble, 1976); Duncan Forbes, “Scientific Whiggism: Adam Smith and John Millar,” _Cambridge Journal_ 7, 1954, pp. 643–70; Andrew Skinner, “Economics and History: The Scottish Enlightenment,” _Scottish Journal of Political Economy_ 12, 1965, pp. 1–22; Andrew Skinner, “Adam Smith: An Economic Interpretation of History,” in A. S. Skinner and T. Wilson eds., _Essays on Adam Smith_ (Oxford: Clarendon Press, 1975); Ronald L. Meek, “The Scottish Contribution to Marxist Sociology,” _Democracy and the Labour Movement_ (London: Lawrence and Wishart, 1954), ed. J. Saville; Andrew Skinner, “A Scottish Contribution to Marxist Sociology?” in _Classical and Marxian Political Economy: Essays in Honour of Ronald L. Meek_ (London: Macmillian, 1982), ed. Ian Bradley and Michael Howard, pp. 79,114; Albert Saloman, “Adam Smith as Sociologist,” in _Social Research_ 12, 1945, 22–42; and Albion W. Small, _Adam Smith and Modern Sociology_ (University of Chicago Press, 1907). > “It is expected that the prerogatives of the monarch, and of the ancient nobility will be gradually undermined, that the privileges of the people will be extended in the same proportion and that power, the usual attendant of wealth, will be in some measure diffused over all the members of the community.” John Millar “Men who have tasted of freedom, and who have felt their personal rights, are not easily taught to bear with encroachments on either, and cannot, without some preparation, come to submit to oppression.” Adam Ferguson ## Legal Theory The linchpin of the “system of natural liberty” advocated by Adam Smith and the other representatives of the Scottish Enlightenment was a legal system which represented individual liberty and property, dispensed fair and inexpensive justice, and allowed for the expansion of individual opportunity by permitting the expansion of commerce and industry. The basic sources on Scottish legal theory are Adam Smith’s _Theory of Moral Sentiments_, (Indianapolis: Liberty Classics, 1976), ed. D. D. Raphael and A. L. Macfie and _Lectures on Jurisprudence_ (Indianapolis: Liberty Classics, 1982), ed., R. L. Meek, D. D. Raphael and P. G. Stein. For a discussion of Scottish jurisprudence, see the following works by Peter Stein, “Adam Smith’s Theory of Law and Society,” _Classical Influences on Western Thought, 1650–1870_ (Cambridge University Press, 1979), pp. 263–73; “Scottish Philosophical History of Law,” in _Legal Evolution: The Story of an Idea_ (Cambridge University Press, 1980), pp. 23–50; “Legal Thought in Eighteenth Century Scotland,” _Juridical Review_ 1, 1957, pp. 1–20; “The General Notions of Contract and Property in Eighteenth Century Scotland,” _Juridical Review_ 8, 1963, pp. 1–13; “Law and Society in Eighteenth Century Thought,” in N. T. Phillipson and R. Mitchison eds., _Scotland in the Age of Improvement_ (Edinburgh, 1970). Other useful pieces on Scottish legal theory include N. McCormick, “Adam Smith on Law,” _Valparaiso University Law Review_, 1980; the essays by James Moore and Michael Silverthorne, David Lieberman, and J. G. A. Pocock in _Wealth and Virtue_, cited above; T. D. Campbell, “Adam Smith and Natural Liberty,” _Political Studies_ XXV, 4, 1977, pp. 523–34; and Knud Haakonssen, _The Science of a Legislator: The Natural Jurisprudence of David Hume and Adam Smith_ (Cambridge University Press, 1981). > “As it is by treaty, by barter, and by purchase, that we obtain from one another the greater part of those mutual good offices which we stand in need of, so it is this same trucking disposition which originally gives occasion to the division of labour.” > > “The real recompense of labour, the real quantity of the necessaries and conveniences of life which it can procure to the labourer, has, during the course of the present century, increased perhaps in a still greater proportion than its money price.” Adam Smith ## Political Economy But whenever the contributions of the Scottish Enlightenment to liberal social theory may be, the development of the science of political economy is perhaps the most important and Adam Smith’s _An Inquiry into the Nature and Causes of the Wealth of Nations_ (Indianapolis: Liberty Classics, 1981), 2 vols., ed. R. H. Campbell and A. S. Skinner, is justifiably the most famous example of it. _Wealth of Nations_ (1776) combines a formidable historical knowledge of both ancient and contemporary economic history and statistics with a theory of how an advanced commercial society operated. Smith was not just content with describing the effects of the expansion of commercial and industrial relations which were then transforming European society. He also was engaged in a fierce struggle to end the inefficient and unjust mercantilist restrictions which were hampering trade, retarding economic growth and prosperity, and threatening to cause a major break with the North American colonies. On Adam Smith’s political involvement in the revolutions of his time, see E. A. Benians, “Adam Smith’s Project of an Empire,” _Cambridge Historical Journal_ 1, 1925, pp. 249–83; C. R. Fay, “Adam Smith, America, and the Doctrinal Defeat of the Mercantile System,” _Quarterly Journal of Economics_ 48, 1934, pp. 304–16; J. A. La Nauze, “The Substance of Adam Smith’s Attack on Mercantilism,” _Economic Record_, pp. 90–93, 1937; R. Koebner, “Adam Smith and the Industrial Revolution,” _The Economic History Review_ II, 3, 1959, pp. 381–91; and Donald Winch, _Adam Smith’s Politics: An Essay in Historiographic Revision_ (Cambridge University Press, 1979). ## Adam Smith \& Laissez Faire Although Adam Smith was no believer in _laissez-faire_ (reserving rather extensive public good functions for the state) the broad analytical framework he worked out was an improvement on what had gone before and laid the basis for more radical _laissez-faire_ theorists, such as the Frenchman Jean-Baptiste Say, in the future. On the debate about whether Smith believed in _laissez-faire_, see the works cited in the previous paragraph as well as the following: Lionel Robbins, _The Theory of Economic Policy in English Classical Political Economy_ (New York: St. Martin’s Press, 1952); Jacob Viner, “Adam Smith and _Laissez-Faire_,” in _The Long View and the Short: Studies in Economic Theory and Policy_ (New York: The Free Press: 1958), pp. 213–45; Warren J. Samuels, _The Classical Theory of Economic Policy_ (Cleveland: World, 1966); Albert Schatz, _L’individualisme économique et sociale_ (Paris: Armand Colin, 1907); Jacob Viner, “The Intellectual History of Laissez-Faire,” _Journal of Law and Economics_ 3, 1960, pp. 45–69; and Andrew S. Skinner, “The Functions of Government,” in _A System of Social Science: Papers Relating to Adam Smith_ (Oxford: Clarendon Press, 1979). More generally on Adam Smith’s economic and political theories, see E. G. West, “Adam Smith’s Economics of Politics,” _History of Political Economy_ 8, 4, 1976, pp. 515–39; Ronald Hamowy, “Adam Smith, Adam Ferguson, and the Division of Labour,” _Economica_ 35, 1968, pp. 249–59; and Samuel Hollander, _The Economics of Adam Smith_ (University of Toronto Press, 1973). Adam Smith’s economic theories were to have a profound effect on both liberal thought and government policy in the nineteenth century, particularly in France and England. The next part of our “Outline” will deal with Jean-Baptiste Say and the liberal movement which developed in France. > “Such neglect of the history of the law, is the more strange, that in place of a dry, intricate and crabbed science, law treated historically becomes an entertaining study: entertaining not only to those whose profession it is, but to every person who hath any thirst for knowledge.” Lord Kames