Table Of ContentPALGRAVE STUDIES IN THE HISTORY OF ECONOMIC THOUGHT
Adam Smith’s System
A Re-Interpretation Inspired by
Smith’s Lectures on Rhetoric, Game Theory,
and Conjectural History
Andreas Ortmann · Benoît Walraevens
Palgrave Studies in the History of Economic
Thought
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G.C. Harcourt, School of Economics, University of New South Wales,
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Peter Kriesler, School of Economics, University of New South Wales,
Sydney, NSW, Australia
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·
Andreas Ortmann Benoît Walraevens
Adam Smith’s System
A Re-Interpretation Inspired by Smith’s Lectures
on Rhetoric, Game Theory, and Conjectural
History
Andreas Ortmann Benoît Walraevens
UNSW Business School Center for Research in Economics
University of New South Wales and Management
Sydney, NSW, Australia Cherbourg Institute of Technology
University of Caen Normandy
Cherbourg en Cotentin, France
ISSN 2662-6578 ISSN 2662-6586 (electronic)
Palgrave Studies in the History of Economic Thought
ISBN 978-3-030-99703-8 ISBN 978-3-030-99704-5 (eBook)
https://doi.org/10.1007/978-3-030-99704-5
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AO dedicates this book to the women in his life. BW dedicates it to his
parents, Annie and Gérard.
Preface
Inspired by his lectures on rhetoric and by game theory, we provide a
new interpretation of Smith’s system of thought, showing its coherence
through the identification, and conjectural history, of three reasoning
routines and a meta-reasoning routine throughout his work on languages
and rhetoric, moral sentiments, and self-command, and the nature and
causes of the wealth of nations. The identification of these reasoning
routines allows us to uncover a hitherto poorly understood deep struc-
ture of Smith’s work, and to explain its main characteristics. We also trace,
in the very Smithian tradition of conjectural history, how these routines
emerged in Smith’s early research on the principles of the human mind.
While our approach does not explain Smith’s complete oeuvre, it does
shed new light on the man and his work. Specifically, our analysis of
Smith’s reasoning routines highlights his sophisticated understanding of
strategic interaction in all things rhetorical, moral, and economic. Game
theory is a set of concepts, a language as it is, to capture this strategic
interaction in precise terms and to then draw on its rich analytic arsenal.
For Smith, people are naturally sociable creatures, “commercial
animals” (Walraevens 2010a, 2010b) that take pleasure in exchanging
ideas, sentiments, and goods. They look after the approbation of their
opinions, conduct, and valuation of goods by their fellow animals. The
unity of Smith’s conception of humans is not based on self-interest
(although Smith overall left little doubt that self-interest is a major
driver of people’s motivations) but rather on sociability which is a social
vii
viii PREFACE
construct. Our languages, moral sentiments, and modes of commercial
exchange evolve and are not God-given, a provocative idea when and
where Smith lived and worked. We identify the Wonder–Surprise–Admi-
ration mechanism as the precursor of the prediction error minimization
mechanism now widely accepted in neuro-economics as the driver of these
evolutionary processes.
While our work is addressed (and, we hope, should be of interest) to
people with different academic backgrounds and interests (in economics,
political science, philosophy, Enlightenment studies, history of ideas), it
also suggests an alternative approach to history of economic thought, and
the fruitfulness of different approaches in the field.
Lapidus (2019) has proposed a typology based on three alternative
approaches, “distinguished on the basis of the way they conceive of
the link between statements, old and contemporary,” respectively called
“extensive,” “retrospective,” and “intensive.” The extensive approach
“refers to any account of old statements in terms of other old state-
ments, whatever their nature.” The retrospective approach “accounts for
old statements in terms of the present-day economic statements which
they prefigure.” Finally, the intensive approach “addresses old state-
ments insofar as they can produce new statements, thus renewing our
present knowledge.” Our book is a mix of all three approaches. As
to the extensive approach, we analyze the personal, intellectual, polit-
ical, and economic context of Smith’s writings and try to show how
it influenced his economic ideas and way of writing (see in particular
chapter 2) and more generally his ways of thinking about the natural
and social world (see chapter 7). As to the retrospective approach, we
show Smith’s deep interest in, and understanding of, various forms of
strategic interactions, by modeling game-theoretically different parts of
The Theory of Moral Sentiments and The Wealth of Nations (WN ) (see
chapters 3 and 5 in particular). Last but not least, we think that there are
lessons to be drawn for contemporary economics from Smith’s complex
view of man, reconstructed in our book, as a fundamentally moral (self-
reflective) and speaking (persuasive) animal moved by his imagination and
passions/emotions, and by his understanding of social rules and norms.
Following Smith and Wilson (2019) and McCloskey (2021), we believe
that Smith’s works might help to create a better, more open, and human
science of economics, a “Humanomics.”
The beginnings of this book go back many years. AO and Steve
Meardon sketched out some basic ideas when they were both at Bowdoin
PREFACE ix
College, Maine, USA in the last decade of the previous century. Life’s
circumstances, and the pressures of academic hiring and promotion
processes (which rarely look kindly on HoT contributions), had the
project simmer on the back-burner for a number of years. Meanwhile,
in Paris, BW was independently developing his project which resulted,
among other outputs, in a 2010 publication on the language of exchange.
AO chanced upon it a couple of years later and proposed a collaboration.
Alas, here we are. And here you are!
Over the years we have received, at various stages, generous feedback
by people we know and that we do not know (e.g., anonymous referees).
We are indebted for insightful comments on various bits and pieces to (in
alphabetical order by last name) Tony Aspromourgos, Dave Baranowski,
Ken Binmore, Laurie Bréban, David Colander, Dave Collings, Jean Delle-
motte, Daniel Diatkine, Sheila Dow, Ryan Hanley, Geoff Harcourt, Gavin
Kennedy, David Levy, Steve Meardon, Leonidas Montes, Ecem Okan,
Spencer Pack, Nicholas Phillipson, Vernon L. Smith, and seminar partici-
pants. Given the time it has taken for this book to become a reality, there
is a good chance our recollections are imperfect and we apologize to those
who we forgot to mention here or in the acknowledgments to individual
chapters.
Thank you to the publishers of History of Economic Ideas (chapter 6),
History of Political Economy (chapter 4), and Rationality &
Society (chapter 3) for permission to reprint selected chapters.
A very special thank you to Nicole Sung for excellent editing sugges-
tions and for compiling the indices.
Thank you to various Palgrave editors who stuck to us over years of
disruption.
Special thanks to Steve Meardon for allowing us to draw on pieces he
co-authored (namely, chapters 3 and 5) and for which he helped lay the
groundwork (chapters 5 and 7).
Sydney, Australia Andreas Ortmann
Cherbourg en Cotentin, France Benoît Walraevens
References
Lapidus A (2019) Bringing them alive. Eur J Hist Econ Thought 26(6):1084–
1106
x PREFACE
McCloskey DN (2021) Bettering Humanomics: A New, and Old, Approach to
Economic Science. University of Chicago Press, Chicago
Smith VL, B Wilson (2019) Humanomics. Moral Sentiments and The Wealth
of Nations for the Twenty-First Century. Cambridge University Press,
Cambridge
Walraevens B (2010a) Croissance et progrès chez Adam Smith. These de doctorat
en sciences economiques, Universite Paris 1 Panthéon Sorbonne
——— (2010b) Adam Smith’s economics and the Lectures on Rhetoric and
Belles Lettres: the language of commerce. Hist Econ Ideas 18(1):11–32
