The importance of Adam Smith's work for economic thought Adam Smith is widely considered the father of economics as a social science and is perhaps best known for his work The wealth of nations. Throughout this work Smith states and informs his belief that society is no longer productive when governed by rules and limitations regarding trade and that in order for markets to maximize prosperity, a free trading environment should be made accessible. In this essay I intend to evaluate the way in which many of Smith's theories, taken directly from his works, can be applied to past and current situations, first from an economic, then social and then political point of view. I will also describe some of Smith's main theories on the factors that determine the market, such as supply and demand, and the labor theory of value, focusing on how these theories can be applied to current situations, demonstrating the strength of his works. I think it is first important to remember that Smith grew up in a market environment in which mercantilism was considered the most positive policy with which to increase the wealth of a country. This theory is based on the idea that a country's resources are a measure of its prosperity as a nation, and thus has often been implemented using policies such as high rates of exports and low rates of imports. To ensure this low import rate, tariffs were often imposed on goods entering the country. Adam Smith was one of the first men to express his opinions on this mercantile system, stating that the policies were imperfect and that the goods and wealth were not. good measures of a country's prosperity, and that in fact...... middle of paper......cy. I don't believe that without Smith the economy would not exist, but I feel that it would lack much of its transferability between past and modern scenarios. References http://en.wikipedia.org/wiki/Mercantilism http://www.martinfrost.ws/htmlfiles/wealth_nations.html - Invisible Hand Shopping Cart Example http://en. wikipedia.org/wiki/Division_of_labourBibliographyhttp://en.wikipedia.org/wiki/Mercantilismhttp://www.martinfrost.ws/htmlfiles/wealth_nations.html - Example of an invisible hand shopping carthttp://en.wikipedia.org /wiki /Division_of_labourCanterbury ERA History of Economic Thought, Penguin, London 1991Dowd D Capitalism and Economics, Pluto, London 1995Smith A The Wealth of Nations, Dswavid Campbell Publishers 1991