Happy New Year’s Eve, loyal readers! Here, I will review Chapter 1 of Adam Smith Reconsidered, which is titled “Commercial Society, History, and the Four Stages Theory”. In brief, from what I can tell, Professor Sagar has two goals in this early chapter. One is to clarify the true meaning of the term “commercial society” in Smith’s works; the other is to put Adam Smith’s so-called “four stages” model of economic development into context. As it happens, Sagar devotes most of Chapter 1 to Smith’s theory of history, so let’s begin there.

By way of background, the “four stages” is a simple model that Smith himself first presented to his students when he was still a full-time professor at the University of Glasgow in the 1750s and early 1760s. (Specifically, see Smith’s “Lectures on Jurisprudence”, which are available here.) In summary, Smith divides economic history into four separate stages: “1st, the Age of Hunters; 2dly, the Age of Shepherds; 3dly, the Age of Agriculture; and 4thly, the Age of Commerce” (see Smith, Lectures on Jurisprudence (A), i.27; see also the infographic pictured below.) So, what should we make of this model?

For his part, Professor Sagar explains why most Smith scholars have for various reasons misinterpreted Smith’s simple model, believing it to represent a “stadial” or deterministic account of economic history, with commercial society representing the culmination of economic progress. Although Sagar’s meticulous critique of this common-sense reading of Smith’s historical theory is the most tedious part of his entire tome, it suffices to say that, according to Sagar, Smith’s four-stages model is just a thought experiment, not a “conjectural history”, let alone an historical account, “of how things ever actually happened” (Sagar, p. 20, internal quotation marks omitted). So, who’s right?

Alas, I don’t think the answer to this question matters too much, for as Sagar himself correctly notes, Adam Smith makes no mention of his four-stages model in The Wealth of Nations (ibid., p. 40). Also, for what it’s worth, I would further add that this simple model — as well as anything else in the “Lectures on Jurisprudence” for that matter — must be taken with a large grain of salt. Why? Because Smith never published those Glasgow-era law lectures. (The Lectures on Jurisprudence are a series of class notes taken by one of his students.) Although Adam Smith was writing a book on jurisprudence — something Smith reveals to his readers as early as 1759 in the last paragraph of his first great work, The Theory of Moral Sentiments — he not only never finished writing that promised law book; he specifically instructed his literary executors to destroy the unpublished manuscript upon his death, which they did!

What about the meaning of the term “commercial society” in Smith’s works? Here, Sagar makes two important points, both of which I readily concede as correct. One is that Smith himself used the words “commercial society” only twice (p. 52). The other is that, for Smith, there are many different types of commercial society, such as those of ancient Athens and Rome, that of Imperial China, and that of post-feudal Europe. Having now dispensed with Smith’s four-stages model and having also established that “commercial society” can have multifarious meanings, we will proceed to Chapter 2 in my next post.