‘had the original state of things continued’

Abstract

In common with his predecessors, contemporaries, and with his early 19th-century successors, Smith put forward what is widely regarded as a labour theory of (exchangeable) value. There is, however, evidence of his awareness that whatever merits such a theory may have had for explaining the derivation of exchange value in the distant past, consistent with conventional knowledge and his historical perspective, it was insufficient to explain the observed exchange behaviours using prices in markets.¹ And this created one of those conundrums forever associated with his name: to what extent was Adam Smith committed to a labour theory of value? I suggest the answer is ‘very weakly’, if at all. Therefore, I do not subscribe to the view, expressed by Paul Douglas many years ago, that ‘it might seem to be the path of wisdom to pass these topics by in discreet silence’.²