R. H. Coase Graduate School

R. H. Coase

1 7

many other motives. The condition of

human nature were peculiarly hard if

those affections which, by the very

nature of our being, ought frequently

to influence our conduct, could, upon

no occasion, appear virtuous, or deserve

esteem and commendation from any

body.25

Furthermore, Adam Smith points out, the

notion of benevolence as encompassing “the

general happiness of mankind” would require

man to do something of which God is no

doubt capable but that is beyond the powers of

m a n   : “The administration of the great

system of the universe, . . . the care of the

universal happiness of all rational and sen-

sible beings, is the business of God, and not

of man. To man is allotted a much humbler

department, but one much more suitable to

the weakness of his powers, and to the

narrowness of his comprehension-the care

of his own happiness, of that of his family,

his friends, his country: . . . .  “26

It was not Adam Smith’s usual practice

to proclaim that there was a natural harmony

in man’s psychological propensities. What he

normally did was to point out that particular

characteristics of human beings which were

in various ways disagreeable were accom-

panied by offsetting social benefits. Man’s

nature may seem unpleasant to our fastidious

taste but man appears to be as well adapted

to the conditions in which he has to subsist

as the tapeworm to his. The implication of

the various remarks of Adam Smith would

appear to be that any change in man’s nature

would tend to make things worse. But Adam

Smith avoids stating this general conclusion.

It is not difficult to see why he showed this

caution. If he had asserted that there

was such a natural harmony, how did

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Selected Papers No. 50

i t   c o m e   a b o u t   t h a t   t h i s   w a s   s o ?   A d a m

Smith tended to think, as I suppose was

usual at that time, of the universe as a

machine. He speaks of “the various appear-

ances which the great machine of the universe

is perpetually exhibiting, with the secret

wheels and springs which produce them.”

If there was such a natural harmony in

human nature, how did it happen that human

beings were designed in the way they were?

According to Viner, Adam Smith thought

that this was due to divine guidance, that

man exhibited these harmonious character-

istics because he had been created by God.

It is difficult for us to enter the mind of

someone living two hundred years ago, but

it seems to me that Viner very much

exaggerates the extent to which Adam Smith

was committed to a belief in a personal God.

As Viner himself notes, in those parts of the

discussion where we would expect the word

“God” to be used, it is rarely found and

the word “Nature” is substituted or some

such expression as “the great Architect of

the Universe” or “the great Director of

Nature” or even, on occasion, the “invisible

hand."27 It seems to me that one can gauge

the degree of Adam Smith’s belief from the

remark he makes in The Wealth of Nations

when he notes that the curiosity of mankind

about the “great phenomena of nature” such

a s

“the generation, the life, growth and

dissolution of plants and animals” has led

men to “enquire into their causes.” Adam

S m i t h   o b s e r v e s   : “Superstition first attempted

to satisfy this curiosity, by referring all those

wonderful appearances to the immediate

agency of the gods. Philosophy afterwards

endeavoured to account for them, from more

familiar causes, or from such as mankind

were better acquainted with than the agency

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R. 

H. Coase

1 9

o f   t h e   gods."28

This is hardly a remark

which would have been made by a strong,

or even a mild, deist.

The fact of the matter is that, in 1759,

there was no way of explaining how such

a natural harmony came about unless one

believed in a personal God who created it

all. Before Darwin, Mendel and perhaps also

Crick and Watson, if one observed, as Adam

Smith thought he often did, a kind of harmony

existing in human nature, no explanation

could be given if one were unwilling to

accept God the creator. My own feeling

is that Adam Smith was reluctant to adopt

this particular explanation. His use of the

term “Nature” and other circumlocutions

was rather a means of evading giving an

answer to the question than the statement

of one. Since Adam Smith could only sense

that there was some alternative explanation,

the right response was suspended belief, and

his position seems to have come close to

this. Today we would explain such a

harmony in human nature as a result of

natural selection, the particular combination

of psychological characteristics being that

likely to lead to survival. In fact, Adam

Smith saw very clearly in certain areas the

relation between those characteristics which

nature seems to have chosen and those which

increase  the likelihood of survival.

Consider the following passage from The

With regard to all those ends which,

upon account of their peculiar im-

portance, may be regarded. . . as the

favourite ends of nature, she has con-

stantly. . . not only endowed mankind

with an appetite for the end which she

proposes, but likewise with an appetite

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