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Adam Smith and the

Commercial Question:
The Peaceful Commercial Society?
Afeefah Ally
University of Toronto
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Afeefah Ally - 998985479
Daniel Silver - SOCB42H3
Adam Smith and the Commercial Question: The Peaceful Commercial Society?
In 1776, Adam Smiths, The Wealth of Nations presented a critical analysis of the commercial
society in an effort to respond to many of the concerns being raised as a result of the growth and
expansion of commercial societies at the time. While Smith addresses a number of different concerns,
one of the most important is probably the question of whether commercial societies are in fact a
positive or negative source of development and whether in fact their benefits outweigh their
disadvantages. Despite the fact that there exists a significant difference in opinion on the matter, one
matter of particular contestation is the issue of the prospect of` peace in a commercial society.
Although he does not explicitly address the issue of peace in a commercial society, an analysis of The
Wealth of Nations will permit for deductions to be made on his views on the matter. In other words,
while Adam Smith understood that commercial societies do not necessarily generate equality, he
would nonetheless agree that commercial societies give rise to peaceful societies primarily through
encouraging collaboration, cooperation as well as stability.
A study of The Wealth of Nations establishes that Smith defines commercial societies as being
based upon several fundamental principles, a key one being the division of labor. In fact he begins The
Wealth of Nations by first highlighting the importance of labour to a commercial society, The annual
labour of every nation is the fund which originally supplies it with all the necessaries and
conveniences of life.
Smith then moves on to emphasize the importance of the division of labour in
terms of economic efficiency. The greatest improvement in the productive power of labour and the
greater part of the skill, dexterity and judgment, with which it is anywhere directed, or applied, seem
to have been the effects of the division of labour.
According to Smith, the division of labour plays
such a key role in a commercial society because it expands markets allowing for the successful

Adam Smith, An Inquiry into the Nature and Causes of the Wealth of Nations. (Pennsylvania: Electronic Classics
Series, 2005) 8.
Smith, 10.
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distribution of money.
By extension, a commercial society is therefore a network of relationships
organized by a market centered around money where no individual is entirely dependent on a single
person but rather on a system of individuals.

On the other hand, peaceful societies can be defined as societies that demonstrate not only
collaboration and cooperation but also stability. The division of labour, the organization of the market
and trade itself all encourage peace by creating stability through collaboration and cooperation, a fact
which Smith recognizes in the Wealth of Nations as he discusses the various facets of a commercial
The division of labour is one of the cornerstones of commercial society that breeds both
cooperation and collaboration while also securing the stability of the society. This process can be
divided into two forms, the first of which is the division of labour within a particular trade. This entails
a system by which workers focus on one specific aspect of an operation while continuously improving
their skills in that particular task. This concentrated focus allows them to become both highly efficient
as well as skilled in their allocated duty. For instance, to elaborate on the resulting increased efficiency,
Smith uses the example of pin making, But if they [the workers] had all wrought separately and
independently, without any of them having been educated to this peculiar business, they certainly
could not each of them have made twenty, perhaps not one pin in a day; that is certainly not the two
hundred and fortieth, perhaps not the four thousand eight hundredth, part of what they are at present
capable of performing, in consequence of a proper division and combination of their different
As Smith notes, the division of labour within a pin making factory not only increases the
efficiency of the workers but also requires the collaboration of workers throughout the factory in
order to produce a single pin. As a result of the efficacious collaboration and collaboration between the
workers, they are thus capable of producing ten-fold of what they could have produced on their own.

Smith, 21.
Daniel Silver. "Adam Smith's The Wealth of Nations." SOCB42H3: Sociological Theory. (Toronto: University
of Toronto Scarborough, 2013) Lecture 4
Smith, 11 12.
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The division of labour, according to Smith, may also refer to the division between trades. For
instance, Smith notes that the making of a wool coat in fact requires the cooperation and collaboration
of many thousands of people. The woollen coat, for example, which covers the day-labourer, as coarse
and rough as it may appear, is the produce of the joint labour of a great multitude of workmen. The
shepherd, the sorter of the wool, the wool-comber or carder, the dyer, the scribbler, the spinner, the
weaver, the fuller, the dresser, with many others, must all join their different arts in order to complete
even this homely production.
In essence, each tradesperson must work in collaboration with their
colleagues in order to be able to not only build their livelihoods but also in the production of any given
item. They are interdependent upon each other and thus despite any differences that may arise, they
must learn to cooperate and collaborate with each other.
In addition to encouraging cooperation and collaboration within and between trades, the
division of labour also inspires and augments trade itself, which is another main cornerstone of a
commercial society. We acquire the products and services that we need through mutual exchange in a
trade in which we sacrifice something we value less for something we value more, often using money
as a medium.
Smith echoes this concept by clarifying, it is by treaty, by barter, and by purchase, that
we obtain from one another the greater part of those mutual good offices which we stand in need of.

The division of labour allows each person to concentrate on their particular trade in order to ensure
that they are capable of producing enough of a surplus so that they can trade for what they need. By
consequence, each person ends up with a mix of things that they require, all of which have been
professionally produced and have been acquired through exchange. Consequently, even the most
discordant of people must cooperate not out of compassion but because they see the benefit and
necessity of exchange, a process made possible and enhanced by the division of labour.
However, despite the collaboration and cooperation that a commercial society encourages, it
does not in reality inevitably ensure equality, a fact which Smith is cognizant to throughout The Wealth

Smith, 16.
Smith, 18.
Smith, 19.
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of Nations. Specifically, Smith notes that income is distributed unfairly and disproportionately in
commercial societies since rewards are usually inversely proportionate to labour. This is explicitly
demonstrated when examining the disparity that exists between workers, landlords and owners.
Workers for instance, accumulate the least capital out of the three groups despite working significantly
more strenuously than both owners and landlords.
Owners, on the other hand, exert little effort, yet,
they garner the largest portion of revenue and profits in a commercial society.
Similarly, owners have a systematic advantage over workers in the sense that they are more
capable of organizing and combining efforts in order to keep wages of workers at a bare minimum.
The masters, being fewer in number, can combine much more easily; and the law, besides, authorizes,
or at least does not prohibit their combinations, while it prohibits those of the workmen.
As a result,
owners succeed in keeping wages at a minimum generally without fear of reprisals from workers as
workers are usually unable to assemble their fellow workmen together. In addition, they are also
unable to undertake any serious action as striking as, Many workmen could not subsist a week, few
could subsist a month, and scarce any a year, without employment.
On the other hand, because
owners and landlords are capable of accumulating capital, they are able to outlast the workers simply
because of their class in society. Thus, a commercial society also breeds inequality of power between
workers, landlords and owners.
In addition to systematic inequality in a commercial society, Smith also identifies several areas
of natural inequality, particularly in the disparity in wages between workers themselves. Smith
explains that this genre of inequalities, resulting from the structure of commercial societies, is rooted
in the actual nature of the work being tackled. According to Smith, the wages of labour vary with the
ease or hardship, the cleanliness or dirtiness, the honourableness or dishonourableness, of the
Using the occupation of a butcher as an example, he explains The trade of a butcher is
a brutal and an odious business; but it is in most places more profitable than the greater part of

Smith, 58.
Smith, 60.
Smith, 87.
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common trades.
As a result of the difficulty and dirtiness associated with such a job, the wages are
higher than those of a weaver whose working conditions tend to be much cleaner. Similarly, natural
inequality in wages, according to Smith, may also result from several other factors. For instance, the
fact that some professions are more difficult or expensive to learn means that the time and effort that
was spent learning the profession must be recovered through the work itself.
Additionally, some
trades are seasonal such as that of a builder. A mason or bricklayer, on the contrary, can work neither
in hard frost nor in foul weather.
Consequently, their compensation must be adequate enough in
order to sustain them throughout the months when they have no work.
Likewise, the wages of labour
may also vary depending on the level of trust that the line of work demands for instance in professions
such as doctors, lawyers and the like.
Finally, wages can also vary depending on the probability of
success in a particular profession. For instance, lawyers are well paid because very few actually
successfully practice law.

Nonetheless, Smith deems this form of inequality within a commercial society to be necessary
in order to prevent an overflow of workers into any particular industry.
That is not to say that he
believes equality to be a foreign concept or an impossibility in commercial societies. Instead Smith
notes that while inequality is inevitable in commercial societies, it can be kept at a bare minimum by
reducing the restrictions and regulations enforced by the government. Thus while equality may exist
within a commercial society, it can serve a positive role particularly in regards to employment.
In sum, commercial societies are both intricate and complex systems that encourage and
generate peaceful societies by inspiring cooperation, collaboration and stability, all key aspects of a
peaceful society. The division of labour, a chief feature of a commercial society works to ensure the
stability of the commercial society by allowing workers to become more efficient as well as productive.

Smith, 87.
Smith, 88.
Smith, 89.
Smith, 90.
Smith, 91.
Smith, 92.
Smith, 99.
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This results in workers being able to produce a surplus which they can then depend on to exchange
and trade for other products and services they require. However, while Smith also notes that
commercial societies produce as well as encourage both systematic as well as natural inequality, this
does not mean that they cannot produce peaceful societies. In fact, as Smith notes a peaceful society
can be an unequal society. This is proven by the point that commercial societies demonstrate many
key characteristics of a peaceful society such as collaboration and cooperation in systems such as the
division of labor as well as in trade. Despite this, inequality is still present but it is not so pronounced
that it destroys the peace of the commercial society. In essence, a commercial society is a society that is
not flawless but is nonetheless a peaceful one.

Works Cited
Silver, Daniel. "Adam Smith's The Wealth of Nations." SOCB42H3: Sociological Theory. University
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of Toronto (Scarborough), Toronto. 12 Sept. 2013. Lecture 3.
Silver, Daniel. "Adam Smith's The Wealth of Nations." SOCB42H3: Sociological Theory. University
of Toronto (Scarborough), Toronto. 12 Sept. 2013. Lecture 4.
Smith, Adam. An Inquiry into the Nature and Causes of the Wealth of Nations. Pennsylvania:
Electronic Classics Series, 2005. Print.