Adam Smith Changed My Mind About Capitalism

Kidnapped by gypsies when he was 3 years old, raised by a single mom in turn of the century Scotland after his father died chasing highway robbers, toured France during a golden age of art and philosophy as the personal tutor of a young Duke, was very popular with the opium-addled, party-going French intelligentsia, and friends with the likes of David Hume and Voltaire. Yet somehow managed to write one of the most boring books you'll ever read.

When Adam Smith's Wealth of Nations was published it was a huge hit and redefined the field of what's now known as classical economics for the industrial age. Terms like "Division of Labor," and "The Invisible Hand" were coined in this work of literature, and through it the concept of the Free Market was born.

Here's some more interesting content about Adam Smith, some of which are source material for this video:

[silverchairsg]

"It is not from the benevolence of Melissa that we expect our exposition of old books, but from her regard to her own self-interest." -Adam Smith, the Wealth of Youtubers (2023)

[Eristtx]

I remember reading a few chapters of Adam Smith in college and finding it quite entertaining. When I say "entertaining", it was in comparison to the "Macroeconomics B" I was struggling with at the time, which needed 20 pages of equations to explain the basics of the money market. So I guess any economics text without equations and graphs seemed like a miracle to me at the time.

[MaxwellWilliams]

This video is low-key edited really really well. The quick cuts away from every joke show that you're invested in keeping us engaged and I appreciate the pacing!

[AB-etnj]

It's a simplified explanation of market economics, not even necessarily about "capitalism"

[leonstenutz]

Adam Smith wrote A Theory Of Moral Sentiments as a prelude to, and the foundation of, Wealth Of Nations. Highly recommend reading & covering his first book.

[mikitz]

My main criticism towards Smith is that, thanks to the idea of division of labor, no-one has the time to masturbate during the work day anymore.

[Maceta]

The Wealth of Nations was the first Economics book I read in full. I was 17 years old and just wanted to know economics so I could understand my country's economic crisis but didn't want to go for an Economics Textbook.

I bought the thing expecting it to have charts or mathematical functions. At 17 I was way too much of an ignoramus on the history of science to anticipate that couldn't be the case for a book written on the 18th century.

Turns out that the Wealth of Nations is not a book on Economics in the modern sense we understand the term. It is a book that precedes economics as a science. It's basically around 1000 pages of a wise man in the 18th century giving multiple insights into History, Geography, Politics, Morality, Sociology, and all sorts of fields that intersect to form what would Basis of economic thought. It wasn't a book on Economics but it was soooo much better.

It's a sad thing nobody bothers to read the classics anymore. Very few thinkers are so wrongly maligned as Smith, even in the reviews for this book, made by people who didn't read the book. I get that it's hard to sit down and read a 1000 page book of mostly outdated info, but I can assure for a fact that over 90% of people who took the time to do so would find themselves in agreement with Smith in pretty much all the issues he covers. He was a humble, reasonable & wise man that as many others of his time pursued no malign intentions with his writing, but rather wanted to contribute as much as he could to better his society.

[ruslansuleimanov]

2 minutes into watching this video I was greatly suprised that the viewership on this video wasn't at least in the range of 50k-100k views! Excellent work, this was a very engaging, fun, informative and accessible watch. Keep it up!

[Tehan]

1. The diamond and water paradox does not disprove Marx's LTV, if anything, it's clear that the great contrast in "use value" and "exchange value" between diamonds and water shows that the scarcity of diamond due to the high amount of labour it takes to mine, process, etc, shows that this is where its value comes from.

2. If Labour did not create value, there would be no point in hiring workers to (in combination with the free gifts of nature) create commodities. The entire point in marx's labour theory of value, is that it is possible to use money (realization of value in the money form) to purchase a commodity (labour) to create commodities to sell on the market (if you own the means of production), and then end up with more value than you started with, and that extra value added by the workers is called "surplus value". The simple commodity example Marx gives is that "20 yards of linen equal one coat" on the market, since the transformative power of labour adds value to raw materials.

3. 11:49 "Marginal value theory" doesn't appear to be a thing, there is marginalism and marginal utility, but what you describe sounds like the "Subjective theory of value"

4. We know that it is not simply desires that determine price, although they may influence it. For example, technological breakthroughs lower the price of commodities, consider how much a coat costs now vs 200 years ago. Additionally because less labour is required to produce that coat, its exchange value (price) is consequently lower.

5. The other point I want to make is to not understand it in the sense that one theory is "wrong" and another is "right". Both Smtith's and Marx's Labour theory of value have different political purposes, Smith wanted to emphasise the virtue of markets whereas Marx wanted to emphasise the immorality of worker exploitation. Subjective theory of value places the focus on the point of exchange rather than production. They're more models for understanding than empirically true or false, since unfortunately pretty much all of them result in circular reasoning on one level or another at a certain point

[jamestitus]

Horrible take on "fuedalism" as to be expected but otherwise good summary of Adam Smith. His optimism really is incredible. By now, he figured we'd hardly be working.

[aenima]

Wow, only 211 subs? You deserve WAY more. Im thankful to the algo for showing me your videos. Great job!!

[goinby]

Who knew that Adam Smith's Wealth of Nations could be so entertaining? 😂
It's clear that you put a lot of effort into this project, and the result is both informative and laugh-out-loud funny.
Keep up the amazing work!

[timc]

What Melissa says at the end about Labor Value Theory isn’t quite correct. Marx’s version was different than Smith. Marx was talking about value as a laborer renting their labor to a “capitalist”, not value as a consumer buying a product/service from a store. If a capitalist is looking to hire a person, they will pay the person only less than what they earn from that person’s labor. Marx called this “surplus value”, which he believed the laborer was entitled to, not the capitalist.

[MrReigato]

The way you're describing how you feel reading The Wealth of Nations (as well as your overview of the trajectory of history) heavily reminds me of how I've been feeling reading Capital by Karl Marx lately... I strongly agree with you that reading challenging ("boring") material is very worthwhile

[stevene]

This increased the marginal utility of my day! Thank you

[inspiringinquiry]

Engaging content. After watching your other videos I found that I enjoy the how well you pull off edgy, witty and kinda quirky material with relevant pop culture references. But I absolutely love that you’ve added ‘intellectual’ and ‘informative’ in there with this video because it really harmonizes the content making it not only entertaining and thought provoking but also gives you something to take with you.. Definitely subbed

[ZackEdwards]

Interesting fact: under feudalism, you didn't have to hand over most of your crops and cattle. The feudal serf worked probably the equivalent of 3 days a year to pay the tribute owed to his feudal lord. This doesn't mean that they did not work for the rest of the year; they did work, but the rest was to feed and sustain themselves, not their lords.

[garbkas]

10/10 loved the debut video Melissa! Went to go check out other videos in your channel and realized this was the only one. Excited to see where you take the channel!

[sasi]

11:32 "labor doesn't determine what's valued, it consumer's perception that determines value"
Communists have left the chat
Austrian school have entered the chat

[vrrosales]

Just stumbled upon this video and 2 mins in I say to myself “this must be a big channel I’ve never seen before” to my surprise it is below 100k! Subscribed!