The commonplace latter-day notion that Smith is the founder of political economy is of course false, at least if taken literally. Neither the term ‘political economy’, nor the concept, originates with him. Nevertheless, he may rightly be conceived of as the founder of the discipline, in a certain particular sense, as we shall see. The first section below clarifies how the notion of a political economy is constituted by Smith. This also requires some consideration of his conception of ‘science’. The emergence of various concepts of political economy before Smith is then examined. The second section explores the meaning in his texts of ‘wealth’, which is the central object of political economy in his understanding of the science. For the purposes of political economy, the critical notion of wealth is as the national product or ‘annual produce’. The subsequent examination of the history of the notion of ‘wealth’ in that section reveals something significant about the transition to modernity. The emergence of modern political economy, both in Smith’s thought and that of others, is in this regard an important expression of that transition. These two investigations are preliminary to a consideration of those fundamental structures of Smith’s economics, indicated in Chapter 1 and to be explored in subsequent chapters.