Key Ideas

1. Division of labor leads to increased productivity. Adam Smith argues that when workers specialize in specific tasks, they are able to become more skilled and efficient, which leads to increased productivity and economic growth.

2. The invisible hand guides the market. Smith introduces the concept of the “invisible hand” which describes how the self-interest of individuals and firms in a free market system leads to the overall benefit of society.

3. Free trade promotes economic growth. Smith emphasizes the importance of free trade between nations, arguing that it allows for specializ....
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Quiz