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In Adam Smith’s Own Words: The Role of Virtues in the Relationship Between Free Market Economies and Societal Flourishing, A Semantic Network Data-Mining Approach

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  • Johan Graafland

    (Tilburg University)

  • Thomas R. Wells

    (Leiden University)

Abstract

Among business ethicists, Adam Smith is widely viewed as the defender of an amoral if not anti-moral economics in which individuals’ pursuit of their private self-interest is converted by an ‘invisible hand’ into shared economic prosperity. This is often justified by reference to a select few quotations from The Wealth of Nations. We use new empirical methods to investigate what Smith actually had to say, firstly about the relationship between free market institutions and individuals’ moral virtues, and secondly about the further relationship between virtues and societal flourishing. We show with more quantitative precision than traditional scholarship that the invisible hand reading dramatically misrepresents both the nuance and the sum of Smith’s analysis. Smith paid a great deal of attention to a flourishing society’s dependence on virtues, including the non-self-regarding virtues of justice and benevolence, and he worried also about their fragility in the face of the changed incentives and social conditions of commercial society.

Suggested Citation

  • Johan Graafland & Thomas R. Wells, 2021. "In Adam Smith’s Own Words: The Role of Virtues in the Relationship Between Free Market Economies and Societal Flourishing, A Semantic Network Data-Mining Approach," Journal of Business Ethics, Springer, vol. 172(1), pages 31-42, August.
    • Handle: RePEc:kap:jbuset:v:172:y:2021:i:1:d:10.1007_s10551-020-04521-5
    DOI: 10.1007/s10551-020-04521-5
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    References listed on IDEAS

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    1. McCloskey, Deirdre Nansen, 2006. "The Bourgeois Virtues," University of Chicago Press Economics Books, University of Chicago Press, number 9780226556635, December.
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    3. Johannes Abeler & Daniele Nosenzo & Collin Raymond, 2019. "Preferences for Truth‐Telling," Econometrica, Econometric Society, vol. 87(4), pages 1115-1153, July.
    4. Hirschman, Albert O, 1982. "Rival Interpretations of Market Society: Civilizing, Destructive, or Feeble?," Journal of Economic Literature, American Economic Association, vol. 20(4), pages 1463-1484, December.
    5. Dominic Burbidge, 2016. "Space for virtue in the economics of Kenneth J. Arrow, Amartya Sen and Elinor Ostrom," Journal of Economic Methodology, Taylor & Francis Journals, vol. 23(4), pages 396-412, October.
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    Cited by:

    1. Ballandonne, Matthieu & Cersosimo, Igor, 2022. "Towards a “Text as Data” Approach in the History of Economics: An Application to Adam Smith’s Classics," OSF Preprints mg3zb, Center for Open Science.
    2. Elena G. Popkova & Bruno S. Sergi, 2021. "Dataset Modelling of the Financial Risk Management of Social Entrepreneurship in Emerging Economies," Risks, MDPI, vol. 9(12), pages 1-20, November.

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