Skip to main content

Business Ethics and the Origins of Contemporary Capitalism: Economics and Ethics in the Work of Adam Smith and Herbert Spencer

Abstract

Both Adam Smith and Herbert spencer, albeit in quite different ways, have been enormously influential in what we today take to be philosophies of modern capitalism. Surprisingly it is Spencer, not Smith, who is the individualist, perhaps an egoist, and supports a "night watchman" theory of the state. Smith's concept of political economy is a notion that needs to be revisited, and Spencer's theory of democratic workplace management offers a refreshing twist on contemporary libertarianism.

This is a preview of subscription content, access via your institution.

References

  • Bassiiry, G. R. and Marc Jones: 1993, ‘Adam Smith and the Ethics of Contemporary Capitalism’, Journal of Business Ethics 12, 621–627.

    Google Scholar 

  • Bellamy, Richard and Tim Gray: 1990, Herbert Spencer's Liberalism (Routledge, London).

    Google Scholar 

  • Bishop, John D.: 1995, ‘Adam Smith's Invisible Hand Argument’, Journal of Business Ethics 14, 165–180.

    Google Scholar 

  • Buckle, H. T.: 1861, History of Civilization in England, Volumes I and II (London).

  • Cropsey, Joseph: 1977, Polity and Economy(Greenwood Press, Westport, Conn).

    Google Scholar 

  • Doherty, Gary and Tim Gray: 1993, ‘Herbert Spencer and the Relationship between Economic and Political Liberty’, History of Political Thought 14, 475–490.

    Google Scholar 

  • Donaldson, Thomas and Patricia H. Werhane, eds.: 1977, Ethical Issues In Business, first edition Prentice-Hall, Englewood Cliffs, NJ).

    Google Scholar 

  • Etzioni, Amitai: 1988, The Moral Dimension(Free Press, New York).

    Google Scholar 

  • Francis, Mark: 1978, ‘Herbert Spencer and the Myth of Laissez Faire’, Journal of the History of Ideas 21, 294–299.

    Google Scholar 

  • Frank, Robert: 1988, Passions Within Reason(Norton, New York).

    Google Scholar 

  • Freeman, R. Edward: 1994, ‘The Politics of Stakeholder Theory: Some Future Directions’, Business Ethics Quarterly 4, 409–422.

    Google Scholar 

  • Friedman, Milton: 1962, Capitalism and Freedom(University of Chicago Press, Chicago).

    Google Scholar 

  • Friedman, Milton: 1976, Adam Smith's Relevance for 1976 (University of Chicago Graduate School of Business Occasional Papers #50, Chicago).

  • Gray, J. N.: 1982, ‘Spencer on the Ethics of Liberty and the Limits of State Interference’, History of Political Thought 3, 465–482.

    Google Scholar 

  • Gray, T. S.: 1988, ‘Is Herbert Spencer's Law of Equal Freedom a Utilitarian or JRights-Based Theory of Justice?’, Journal of the History of Philosophy 26, 259–278.

    Google Scholar 

  • Hausman, Daniel M. and Michael S. McPherson: 1996, Economic Analysis and Moral Philosophy(Cambridge University Press, Cambridge).

    Google Scholar 

  • Hildebrand, Bruno: 1848, Die Nationaloekonomie der Gegenwart und Zukunft. Frankfort. (Quoted in the Introduction to the 1976 edition of The Theory of Moral Sentiments.)

  • Hirschman, A. O.: 1977, The Passions and the Interests(Princeton University Press, Princeton).

    Google Scholar 

  • Hudson, William Henry: 1895, 1996, An Introduction to the Philosophy of Herbert Spencer(Routledge/Thoemmes Press, London).

    Google Scholar 

  • Knies, Carl G. A.: 1853, Die Politisch Zoekonomie vom Standpunkte der Geschichtlichen Methode. Braunschweig. (Quoted in the Introduction to the 1976 edition of The Theory of Moral Sentiments.)

  • Lerner, Max: 1937, ‘Preface. Adam Smith’, The Wealth of Nations. Ed. Edwin Cannan (Modern Library, New York).

    Google Scholar 

  • Mandeville, Bernard: 1731, 1988, The Fable of the Bees. Ed. F. B. Kaye (Clarendon Press, Oxford).

    Google Scholar 

  • Morrow, Glenn R.: 1926, The Ethical and Economic Theories of Adam Smith(Augustus M. Kelley, New York).

    Google Scholar 

  • Nozick, Robert: 1974, Anarchy, State, and Utopia(Basic Books, New York).

    Google Scholar 

  • Paul, Jeffrey: 1982, ‘The Socialism of Herbert Spencer’, History of Political Thought 3, 499–514.

    Google Scholar 

  • Peel, J. D. Y.: 1972, Herbert Spencer on Social Evolution(University of Chicago Press, Chicago).

    Google Scholar 

  • Sen, Amartya: 1987, On Ethics and Economics(Basil Blackwell, Oxford).

    Google Scholar 

  • Simon, Walter M.: 1960, ‘Herbert Spencer and the Social Organism’, Journal of the History of Ideas 21, 294–299.

    Google Scholar 

  • Smith, Adam: 1759, 1976, The Theory of Moral Sentiments.Ed. A. L. Macfie and D. D. Raphael (Oxford University Press, New York).

    Google Scholar 

  • Smith, Adam: 1776, 1976, The Wealth of Nations.Ed. R. H. Campbell and A. S. Skinner (Oxford University Press, New York).

    Google Scholar 

  • Smith, Adam: 1762–1764, 1978, Lectures on Jurisprudence [A] and [B]. Ed. R. L. Meek, D. D. Raphael, and P. G. Stein (Oxford University Press, New York).

    Google Scholar 

  • Spencer, Herbert: 1851, Social Statics(John Chapman, London).

    Google Scholar 

  • Spencer, Herbert: 1854, Railway Morals and Railway Policy. Reprinted in Essays, vol. III: 2–112.

    Google Scholar 

  • Spencer, Herbert: 1857, Progress: its Law and Cause, reprinted in Essays, vol. I: 1–59.

    Google Scholar 

  • Spencer, Herbert: 1860, The Social Organism, reprinted in the Essays, vol. I: 265–307.

    Google Scholar 

  • Spencer, Herbert: 1862, First Principles(Williams and Norgate, London).

    Google Scholar 

  • Spencer, Herbert: 1872, Mr. Martineau on Evolution. Reprinted in Essays. II: 371–388.

    Google Scholar 

  • Spencer, Herbert: 1873, The Study of Sociology(Williams and Norgate, London).

    Google Scholar 

  • Spencer, Herbert: 1884, 1982, Manversus the State(Liberty Classics, Indianapolis).

    Google Scholar 

  • Spencer, Herbert: 1886, The Factors of Organic Evolution. Reprinted in the Essays. I: 389–466.

    Google Scholar 

  • Spencer, Herbert: 1892a, Essays: Scientific, Political and Speculative. 3 volumes (D. Appleton and Company, New York).

    Google Scholar 

  • Spencer, Herbert: 1892b, The Principles of Ethics3 volumes (Williams and Norgate, London).

    Google Scholar 

  • Spencer, Herbert: 1896, The Principles of Sociology3 volumes (D. Appleton and Company, New York).

    Google Scholar 

  • Spencer, Herbert: 1904, Herbert Spencer: An Autobiography, 2 volumes (Williams and Norgate, London).

    Google Scholar 

  • Stigler, George: 1971, ‘Smith's Travels on the Ship of State’, History of Political Economy III.

  • Turner, Jonathan: 1985, Herbert Spencer: a Renewed Appreciation(Sage Publications, Beverly Hills, CA).

    Google Scholar 

  • Viner, Jacob: 1926, ‘Adam Smith and Laissez Faire’, Adam Smith, 1776–1926. Ed. J. M. Clark, et al. (Augustus M. Kelley, New York).

    Google Scholar 

  • von Skarzynski, Witold: 1878, Adam Smith als Moralphilosoph und Schoepfer der Nationaloekonomie.Berlin. (Quoted in the Introduction to the 1976 edition of The Theory of Moral Sentiments.)

  • Weinstein, D.: 1990, ‘Freedom, Rights, and Utility in Spencer's Moral Philosophy’, History of Political Thought 11, 119–142.

    Google Scholar 

  • Werhane, Patricia H.: 1989, ‘The Role of Self-Interest in Adam Smith's Wealth of Nations’, Journal of Philosophy, 669–680.

  • Werhane, Patricia H.: 1991, Adam Smith and His Legacy for Modern Capitalism(Oxford University Press, New York).

    Google Scholar 

  • Werhane, Patricia H.: 1997, ‘Adam Smith's Legacy for Ethics and Economics, Judge Institute for Management Studies Working Paper WP20/97, University of Cambridge.

  • Williamson, Oliver: 1985, The Economic Institution of Capitalism(Free Press, New York).

    Google Scholar 

Download references

Author information

Authors and Affiliations

Authors

Rights and permissions

Reprints and Permissions

About this article

Cite this article

Werhane, P.H. Business Ethics and the Origins of Contemporary Capitalism: Economics and Ethics in the Work of Adam Smith and Herbert Spencer. Journal of Business Ethics 24, 185–198 (2000). https://doi.org/10.1023/A:1005937623890

Download citation

  • Issue Date:

  • DOI: https://doi.org/10.1023/A:1005937623890