Adam Smith, The Wealth of Nations, and Gutter Cleaning

On Tuesday I drove from Maryland to Piscataway, New Jersey, to give a talk in the Fall 2007 Seminar series at the Department of Industrial and Systems Engineering at Rutgers University. It was 180 miles each way, and I listened to a book on tape about Adam Smith and his masterpiece of economics, the Wealth of Nations, in which he argues that, by each person's looking out only for his own self-interests, the actions and decisions of many persons (as if guided by "an invisible hand") form a rational economic system that maximizes the wealth of a society. Part of the emergent behavior is that persons will find that specialization is their best chance of success. (Another aspect is the appearance and adoption of a currency that does not lose value and can be divided into very small portions.)

Those ideas of specialization and of self-interest were very real today, as the guy cleaning the neighbor's gutters knocked on our door and wanted to know if we needed his services as well. Actually, we did need our gutters cleaned (and I don't do gutters). So it was a win-win: he earned some income doing something in which he specializes, and we got our gutters cleaned while I graded papers.