9 - On the Role of Government: Book V of The Wealth of Nations

Summary

Having described in WN Book IV the errors of government policy that follow from competing systems of political economy, in WN Book V, the last Book of The Wealth of Nations, Smith goes into great detail as he describes:

• what he believes government should and shouldn't do, and

• how it should and shouldn't do what it should.

All these “shoulds” should suggest that WN Book V is a prescriptive, policy-oriented ending to Smith's Inquiry into the Nature and Causes of the Wealth of Nations. And it is.

Smith wrote in the Theory of Moral Sentiments, seventeen years before the publication of The Wealth of Nations, that:

if you would implant public virtue in the breast of him who seems heedless of the interest of his country, it will often be to no purpose to tell him, what superior advantages the subjects of a well-governed state enjoy; that they are better lodged, that they are better clothed, that they are better fed. These considerations will commonly make no great impression. You will be more likely to persuade, if you describe the great system of public police which procures these advantages, if you explain the connexions and dependencies of its several parts, their mutual subordination to one another, and their general subserviency to the happiness of the society; if you show how this system might be introduced into his own country, what it is that hinders it from taking place there at present, how those obstructions might be removed, and all the several wheels of the machine of government be made to move with more harmony and smoothness, without grating upon one another, or mutually retarding one another's motions. […]