Adam Smith's Ideal Economic System During The Enlightenment Era

During the midst of a rapidly developing society, Adam Smith, a fellow of the Enlightenment Era, took great strides to analyze an ideal economic system. To begin, the roots of his economic study first began by observing the town commoners interacting with one other, all exchanging goods, gossiping, and sharing ideas. As he studied their actions, he realized that the two parties of a transaction (that is, the buyer and the vendor) found mutual benefit, with the vendor obtaining a concession from the seller, and the buyer receiving their desired goods. These vendors, he realized, did not sell from their benevolence, but of their self-interest, hoping to support themselves and their family. Next, a further assessment stated that all individuals

In fact, Smith was "pro-market", rather than "pro-business." For instance, the British East India Company, one of the largest and most influential trading firms to dominate the Asian markets, was practically its own political entity. The company had its own currency, military, and policy implementations. In addition, any financial losses were covered by government, which disgusted Smith. Because of the sheer life of the company (spanning from the decline of the Dutch E.I.C. to the 19th Century) and its total control over the markets, no competition could sprout, resulting in a company too large to fail. In order to have a sustaining economy, Smith suggested that no partiality by the government be shown to corporations; they must either adapt or crumble. As recent as 2008, a number banking companies, some with an insurmountable amount of influence in financial affairs, collapsed during the onset of the recession. The government initiated a bailout program to save these banks, but it failed, similarly to the eventual decline in the E.I.C. As a result, the world markets, businesses, and mortgages all fell destitute for several years. In essence, Smith envisioned a society that valued competition among business ventures, which can then place the focus on the consumers, rather than total market