According to the natural course of things, therefore, the greater part of the capital of every growing society is, first, directed to agriculture, afterwards to manufactures, and last of all to foreign commerce. This order of things is so very natural, that in every society that had any territory, it has always, I believe, been in some degree observed. Some of their lands must have been cultivated before any considerable towns could be established, and some sort of coarse industry of the manufacturing kind must have been carried on in those towns, before they could well think of employing themselves in foreign commerce.--Adam Smith (1776) Wealth of Nations (hereafter WN), 3.1.8, 380)
The quoted paragraph presupposes a distinction between a stagnant and a growing society. This is as an important distinction because for Smith only growing societies, with the right sort of institutions -- especially the legal protection of all against violence by the wealthy and with, as Lisa Herzog (2016) has put it, with the possibility of “working one’s way up” -- can really be flourishing, including the vast majority of the working poor. (Growth is as Herzog notes instrumental to that.)* This is not to deny that for Smith individual or sectorial/class flourishing (and individual great virtue) is possible in stagnant socities.
In fact, in Smith's anlysis stagnant societies can be very wealthy. Then contemporary China "a country much richer than any part of Europe," (WN 1.11.n.1, 256) is the most prominent example. (See also WN 1.11.e.34, 208) In fact, as is well known, according to Smith "China seems to have been long stationary, and had probably long ago acquired that full complement of riches which is consistent with the nature of its laws and institutions." (WN 1.9.15, 111) On my account (which is pretty standard) this suggests that Smith thinks a different set of laws and institutions may well be capable of turning China into a growing society again.
By contrast, most stagnant societies are poor (and miserable) because they are characterized by lawless violence. The characteristic exemplar of this is feudalism (e.g. WN 3.3.12, 405), “where men are continually afraid of the violence of their superiors.” (WN 2.1.31, 285) To be sure, very rich countries can engage in lawless violence abroad, and he relentlessly criticizes “the savage injustice of the Europeans” in their colonial imperialism (WN 4.1.32, 448), which is defended by ideologues and merchants (hence the name, 'mercantile system').
Now, in the quoted passage at the top of the post, Smith clearly presents a stadial growth model of the direction of capital (accumulation and) investment. This has three stages corresponding to three sectors of the economy (viz. "agriculture....manufactures...foreign commerce.) This natural growth model has a kind of ceteris paribus condition built into it. Because in the very next paragraph Smith recognizes that “unnatural and retrograde order(s)" are possible and in fact have existed throughout European history. (WN 3.1.9, 380) Somehow these do not falsify or refute the stadial growth model (or its natural path). I return to the relationship of the stadial growth model and historical reality below.
The present post is triggered by the first chapter of Paul Sagar's new (2022) book, Adam Smith Reconsidered. The main point of the chapter is to suggest that nearly all scholars have misunderstood Smith's concept of a 'commercial society.' [Even by his own lights, Sagar is rather "polemical." (p.10)] And that's because according to Sagar, who self-consciously is following his mentor István Hont (p.12), 'society' "properly denotes the internal relations of a given community." And this is "distinct from 'nation', 'country', or 'state'. In Smith's usage 'nation', 'country', and 'state' denote a community in regards to its external relations...in particular in the arenas of military and economic competition." (pp. 47-48. Emphasis in original.) And because other scholars (including Hont) tend to miss or forget the distinction, they end up misrepresenting or distorting Smith's views. Let me stipulate, for the sake of argument, that Sagar and Hont are right that there is an important theoretically salient contrast between Smith's use of 'commercial society' and 'commercial nation' (state/country). And, so it follows that if one were to attend to the distinction one would represent Smith otherwise. So, in what follows I leave Sagar's main claim untouched (in part because it would require engagement with the rest of the book).
Now, as Sagar notes, it is common among Smith scholars to attribute to Smith a stadial account of history. And usually by this is meant a four-stage large scale social development model that runs from hunter-gathering, to shepherding, to agricultural, and to -- and this is key to Sagar's argument --the fourth stage, that is, 'commercial society.' These stages are kind of (Weberian) ideal types in which a particular form of economic organization predominates (and, user-friendly, gives the stage its name) and greatly shapes the social order. (This way of understanding Smith became especially popular through the influence of Marx and Marxist scholarship, but is now mainstream.)
In my view, there are two standard ways of understanding this stadial, large scale social develoment model. One treats it as a rough outline of actual historical development and another treats it as an instance of (what since Dugald Stewart, who, besides being an influential philosopher, also penned an early influential biography of Smith) is called 'conjectural history.' (To simplify: conjectural history is a kind of counterfactual, 'how possible' account that is generally causal in character.) I was a bit surprised to read Sagar claim that there is a 'standard model' of interpreting Smith in which nearly all scholars hold both ways at once. (p. 15) I had never noticed this (despite the obvious tensions it would entail). But let me leave that aside in what follows.
Here's the first important point: the stadial growth model and the stadial, large scale social development model are clearly not the same! They focus on different things (capital vs whole social orders) and they don't even have the same number of stages. While Sagar never quite diagnosis it like this (and misses some details), his polemics start from this textual fact. And I think he could agree with everything I said up until now (except that I explicitly added a Ceteris paribus condition to the economic model).
So, the existence of these two contrasting stadial models, requires a number of exegetical and conceptual choices among scholars. According to Sagar other scholars have botched those choices. (His footnotes are relentless on this.) This matters because Sagar wants to reject the idea that Smith is a defender of 'commercial society' in the (unqualified even anachronistic) way this is usually presented by other scholars, but really is a theorist of politics and (to look ahead to future chapters) that the choice is really about the kind of commercial society we want. I actually have lots of sympathy for, and agreement with, Sagar's larger project. So, while I will be critical of Sagar in what follows, I don't want to hide my agreements.
In my 2017 book, I had treated the large scale social model in chapter 6. (Sagar calls it a 'nuanced picture.') Sagar entirely misses that I had treated the stadial growth model in a chapter "The Methodology of the Wealth of Nations" that I think Sagar completely skipped. (In fairness to him my book is long and I don't alert the reader to the fact that I treat the stadial models differently in part because I was more interested in exploring the epistemic pay-offs of them.) On my account the stadial growth model is a tool to develop an analysis of the causes (many of them political in character) and institutions that prevent long term growth. (Recall the treatment of China above.) My account of the growth model and its focus on institutions builds on earlier, widely cited work by the economist Nathan Rosenberg (1960) and the intellectual historian (1993) Jerry Muller.+ What I added to their approach is simple: historical deviations from the growth model (pretty much all of European history since the fall of the Roman Empire!) help identify major social (and natural) causes. (What I learned from Sagar's book (e.g. p. 24) is that I should have emphasized more the role of war among these casues for Smith.) I argued for this understanding of Smith's project in Books I-III of Wealth of Nations by offering a new account of Smith's philosophy of science. So, my reading of the stadial growth model rejects it as real history and rejects it as conjectural history.**
By contrast, I argued that the large scale social model is indeed a kind of conjectural history. (Inspired by Emma Rothschild's work, most of my own interpretation of Smith is very cautious about accepting Dugald Stewart's account of Smith. By contrast Rothschild barely registers in Sagar.) But the large scale social model is, on my account, designed to identify important social-conceptual necessitation relations within and between stages. You don't have to accept my reading, I mention it here as an illustration of what a scholar might do. (And also to suggest that Sagar misses alternative options to the ones he diagnoses in others and to his own.)
Sagar's own position is not far from my own, but he synthesizes the two stadial models into one, and then treats this as "a simplified economic model charactising the anticipated path of development for individual socities absent political distruption." (p. 16) As you can see that's not far of my chapter on the methodology of WN (and an earlier, well cited 2005 article, which was the core of my dissertation). I have to admit I was a bit surprised he did not drop a note to Rosenberg's, Mullers, or my work (anywhere between pp. 20-23), but since Sagar has no or negligible interest in the details of what we would now call 'Smith's economics' (and his philosophy of science) I would not expect detailed discussion of my analysis. (I do admit that I find it peculiar to do book length studies of Wealth of Nations without interest in the details of Smith's political economy, but to each their own.)
Now, Sagar is not uncommon in presenting Smith as offering one kind of stadial model. Let's call this the monomodel approach, and Sagar may well be right it is the dominant approach (although as I suggest above his depiction of the consensus seems off to me). Moreover, while I reject the monomodel approach, Maria Pia Paganelli has argued that Smith holds no stadial model at all. Be that as it may, Sagar is, in fact, almost alone among contemporary monomodel-types of treating it as a "simplified economic model."
Another important feature of Sagar's approach is that the final, fourth stage is not a "commercial society," which recall from above has a technical meaning, but a "commercial age." And if he is right about Smith's usage, this is an important correction to the standard picture of the monomodel he is criticizing.
At this point a reader may well wonder why Sagar attributes to Smith four stages (since the passage I quote at the top of the post only has three stages). In fact, to the best of my knowledge in this book he never engages with the passages I quoted at the top of the post (or if he does rather obliquely). This is rather odd because he treats surrounding passages in WN (e.g. p. 23); and the editors of the (standard) edition of WN that he uses and cites, single it out in their general introduction (WN p. 55).
Now, it is worth noting that in Wealth of Nations, Smith never explicitly mentions a four stage model as many scholars have observed. But Smith does discuss a four stage model in his Lectures on Jurisprudence (and many commentators have projected it onto WN). In fact, I really admire Sagar's treatment of Smith's account of this material from the Lectures throughout the chapter. (Because I am interested in the public Smith, I had downplayed this material.) And Sagar is very attentive to development between the earlier Lectures and WN. So far so good.
But while Sagar is an official monomodeler, he does identify another ad hoc three stages model in Book of V of Wealth of Nations (WN 5.1.a.7). [Sorry, I knew this might be dizzying!] Now Sagar claims that this three stage model is basically the standard stadial model circulating in the period (p. 36). He offers no evidence for the claim, although it is certainly true that three stage models (note the plural) circulated in the period. But in Sagar's account this three stage ad hoc model is only making a restricted point in Smith: "that matters of defense are conditions by the subsistence methods prevalent in any form of human community." (37) And, if I understand Sagar correctly, this is primarily a rhetorical/pedagogical device ("to make this apparent to his audience Smith" (p. 37)) and not to be confused with the official (four stage) model Sagar attributes to Smith.
You may note that the ad hoc model shares an imfortant feature with what I have called the large scale social development model: that modes of production constrain and shape other important social features. Some Marxists have seen in this a partial anticipation of the materialist conception of history, after all. And it should be clear now why most monomodelers don't think of WN 5.1.a.7 as ad hoc at all. They see in it the application of the main four stage model. By contrast, I treat it as evidence to reconstruct my (nuanced) interpretation of large scale social model. Either way, I find it really odd that after so much sturm und drang, Sagar needs to introduce an ad hoc model into his account.
Now, if we return to Sagar's analysis of the main model, it is crucial to Sagar's argument that, first, only the first two stages of Smith's model have a genuine counterpart in real history according to the sources available to Smith (16). And, second, in "real history," and the presence of pervasive violence, Smith identifies a developmental trap so that almost no societies advance to the third stage (25-26). The second, especially, is an important point and I hope generates further discussion. (I am not sure why Sagar would deny that for Smith there have been quite a few agrigultural ages.)
But notice that Sagar's diagnosis is compatible with the distinction I started out with in this post. While there is much fascinating change, when it comes to structural capital growth, most societies are in virtue of the effects of pervasive violence treated as stagnant by Smith. (As should be clear if Sahlins, James C. Scott, Graeber & Wengrow are right, Smith is wrong about this.) And, in fact, there is an important distinction lurking here.
Among stagnant societies there are really two kinds according to Smith. Those societies that stagnate in virtue of such pervasive violence are de facto barbarous (or savage). And wealthy societies (with arts and sciences) that stagnate in virtue of their laws and institutions fall under the class of civilized societies. (That is, there are stagnant and growing civilizations.) This distinction (made famous by Pocock) operates explicitly in a passage that Sagar quotes (p 50 n. 48):
The fall of the western empire is the third great revolution in the affairs of mankind, of which antient history has preserved any distinct or circumstantial account. It was brought about by the irresistible superiority which the militia of a barbarous, has over that of a civilized nation; which the militia of a nation of shepherds, has over that of a nation of husbandmen, artificers, and manufacturers. (WN 5.1.a.36, 704)
But rather than treating Rome as a 'civilized' state, Sagar insists that it is "made plain" here that Smith treats Rome as a "commercial society." (P. 50 note 48) Now, textually the passage simply does not support Sagar's claim. (In fact, Smith doesn't use 'commercial' anywhere near it.) My point is not to nitpick about this passage. But rather, that Sagar is so wedded to his own monomodel that he imposes it on the text in places where there is no need to do so. He could, of course, argue in the other direction that given that civilized states are always 'commercial society' in the technical sense diagnosed by Hont and Sagar, he can interpret the passage in the way he does. But this is not Sagar's procedure, and it would be false.
Finally, Sagar is just wrong that the ad hoc model that he ascribes to Smith in Book V just is the one circulating in the period. It is very clear that Smith disagrees with Hume's influential three-stage-model. (I have described this in my book p 309ff.) This bears on Sagar's treatment of the distinction between a society and a nation/state, so I will return to it before long. But for now I should stop.
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