Business: The Revolutionary of Oeconomy

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He was the classic absent-minded professor, a philosopher so immersed in his studies that he often seemed to lose touch with life around him. At social gatherings, he would stand alone talking silently to himself, moving his lips and smiling—although, said a friend, if someone interrupted his reverie, "he immediately began a harangue." As a classroom lecturer, he would stutter and stammer for at least a quarter of an hour before hitting his oratorical stride. Contemporaries loved to talk about the night that he got out of bed absorbed in some theory and wandered 15 miles in his dressing gown before thinking to wonder where he was. Altogether, Adam Smith was scarcely the man to whom an ambitious moneymaker would turn for guidance on the intensely practical questions of how prices, profits and wages are determined.

Yet Smith devoted many of his meditations to just such questions, with startling results. He spent at least ten years writing a book that friends despaired of his ever finishing. Smith described himself as an agonizingly slow workman "who do and undo everything I write at least half a dozen times before I can be tolerably pleased with it." He worked out most of the wording on solitary walks along the windswept shores near his home town of Kirkcaldy, Scotland, then often dictated the results to an amanuensis. He finally published the work in March 1776, under the mouth-filling title An Inquiry into the Nature and Causes of the Wealth of Nations, and thereby laid the intellectual foundations of capitalism.

It was a rarely equaled example of the detached scholar's ability to explain and influence the world of affairs. Smith's absorption in economics, which he called "political oeconomy," was a product of sheer intellectual curiosity. That curiosity led him to read everything that he could find about money, to study statutes on trade, interview businessmen and visit workshops (The Wealth of Nations opens with a detailed description of a pin factory)—but not to practice what he preached. Though he considered the desire to accumulate wealth an overwhelmingly powerful motive for humanity in general, he chose for himself what he called the "unprosperous" profession of scholar and man of letters.

His biography consists of little more than a professor's résumé: son of a collector of customs; student at Oxford; a popular lecturer at Edinburgh University; tutor to the young Duke of Buccleuch; full professor of logic and then of moral philosophy at Glasgow; and author in 1759 of a philosophical treatise, The Theory of Moral Sentiments. A bachelor, Smith relied on his mother and a maiden cousin to keep house; if any love affairs ever distracted him from his studies, they have gone unrecorded. "I am a beau in nothing but my books," he once remarked, while showing off his 3,000-volume library to a friend.