ABSTRACT
Focusing on the very beginning of the Wealth of Nations, this chapter analyzes the origins of exchange, trade, and progress. After a brief introduction to set out the context, it will be argued that ethics is an underlying force that allows us to surpass the famous Adam Smith Problem. The concepts of fairness and persuasion are the key for this adventure. Since the “Introduction and Plan of the Work,” Smith refers to the “savage nations of hunters and fishers” that are “miserably poor.” And he goes on to compare this situation with “the civilized and thriving nations” in which “the produce of the whole labour of the society is so great, that all are often abundantly supplied.” Then, in the first chapter of Book I of the Wealth, there is another defense of progress. In these early comparisons, Smith already reveals the morality behind the Wealth of Nations. However, the cause of trade and progress of civilization is uncovered in the foundational Chapter 2 of Book I. It is the famous propensity “to truck, barter, and exchange.” But it is not any kind of exchange: Smith refers to “fair and deliberate exchange.” The use of the unique and untranslatable Anglo-Saxon word “fair” is loaded. Indeed, this word has a rich meaning and sense. The social and moral foundations behind Smith’s deep understanding of trade and the progress of civilization allows us to reassess the Smith Problem, an issue that is still relevant for modern economics.
