Prominent economists laud 'The Legacy of Adam Smith'

Nobel-prize winning economist and Harvard University Professor John Kenneth Galbraith addressed a packed house at the University Museum's Rainey Auditorium yesterday as he discussed "The Legacy of Adam Smith." Galbraith, the last of four speakers, participated in the School of Arts and Sciences's annual Steinberg Symposium, entitled "Rethinking Adam Smith." After University President Judith Rodin introduced him, Galbraith -- who is of Scottish descent -- called Smith "Scotland's greatest son." The Wealth of Nations -- Smith's most famous work -- was published in 1776, just a few weeks prior to the Declaration of Independence, Galbraith said. Smith, who had a strong interest in the American colonies, "deplored the separation of the colonies." Believing that the colonies would eventually overtake Great Britain economically, Smith envisioned the relocation of Great Britain's capital to the American continent. Galbraith called Smith a "master of language," and lauded his work as the best quality writing by an economist. "It was Smith who, for the English speaking world, developed a framework," Galbraith said, terming The Wealth of Nations "a beginning and an end." Galbraith explained that Smith described the economy as regulated by an invisible hand. Although each person pursues his own self-interest, collectively a well-rounded economy is maintained. "The private vice thus became a public virtue," Galbraith said. As he praised Smith's ideas, Galbraith noted, "No economist since has suffered more frequent modifications." He said Smith's major miscalculation concerned humans' inability to cooperate. Believing that cooperation was negligible, Smith felt the monopoly was a firm's best chance for survival. "He failed to see the pride people could have in corporations," Galbraith said, adding that Smith did not foresee the modern corporation, which is "a mix of self- and communal-interest." Although Smith advocated laissez faire, or free-market, economics, Galbraith noted that a governmental role in economic affairs was "made necessary by his economic system." Even today, Galbraith said, governments struggle to find an "intelligent balance between the role of government and the market." Galbraith's address culminated the Steinberg Symposium, which began Tuesday night with the "Adam Smith Reading Project." For the project, students and professors discussed excerpts from Smith's books, The Wealth of Nations and Theory of Moral Sentiments. And yesterday, economists Douglass North and Jeffrey Sachs discussed the impact of Smith's works at a lecture entitled "Adam Smith: Past and Present." Anita Mastroieni, a spokesperson for the School of Arts and Sciences, said the purpose of this year's Steinberg Symposium was "to take the economic theories of Adam Smith and give them a second look." Students, professors and staff -- who jammed the doorways and sat on the stairs in an effort to see the lecture -- raved about the symposium. "The symposium today was a great opportunity to hear the thoughts of the greatest modern economists," College freshman Jennie Huang said. "This symposium is a great event for Penn."