Adam Smith, division of labour and Stigler’s Law

Adam Smith was born 300 years ago this Friday, on 16 June, 1723. Now that we are in the month of his birth, tercentenary birthday parties are picking up pace. Adam Smith was known for his

unassuming manner, and quite conceivably, he would have marked the occasion of his anniversary with his favourite leisure activity, a solitary walk on the Scottish coast, rather than with

having toasts raised in his honour at a gala.

Adam Smith might have kept a low profile personally, but he did not shy from starting out with a bang in his writing. The first chapter of the first book of The Wealth of Nations, On the

Division of Labour, catches the reader’s attention on the first page with a practical demonstration:

The Wealth of Nations is one of only a handful of books where even readers who do not care much for economics can name its author offhand. In economics, The Wealth of Nations has become

something of a Bible. In some ways, in fact, The Wealth of Nations even outdoes the Bible. For example, in length. Adam Smith’s magnum opus comes to 950,000 words, comfortably ahead of the

King James Bible at under 800,000. Hence, for all the name recognition of the book and its author, there must be very few readers, including many of those deeply immersed in economics, who

have ever read it cover to cover.

Adam Smith’s description of how to speed up the manufacture of pins is so vivid, and his inference so intuitive, that he is commonly credited with the discovery of the benefits of the

division of labour. This attribution is questionable, but serves to illustrate Stigler’s Law of Eponymy. Stephen Stigler, a statistician whose interests include the history of his

discipline, examined the naming of scientific laws and noticed a pattern: many scientific laws are named after someone other than the discoverer. Stephen Stigler offered some examples, and

since then others have added more. Compilations of Stigler’s Law by now have accumulated an almost endless list of instances.

Measured out with the yardstick of Stigler’s Law, Adam Smith’s reputation runs ahead of his achievement. As David Graeber has pointed out, long before Adam Smith the medieval Arabic

historian Ibn Khaldun described how the division of labour benefits the gathering of food:

Adam Smith could not have known about the works of Ibn Khaldun, which did not yet circulate in Europe when he was writing The Wealth of Nations. But in any event, he would not have needed to

look as far afield as medieval Islam to come across a description of the workings of division of labour. All he had to do was reach for back issues of The Spectator.

Joseph Addison (1672 – 1719), the principal writer of The Spectator, put these words into the mouth of his fictive Whig porte-parole Andrew Freeport:

These remarks appeared in November 1711. At that time, Joseph Addison must have been conscious of treading on unfamiliar ground, because he has Andrew Freeport cite his source, the admirable

William Petty. By 1776, the year of publication of The Wealth of Nations, enough time had elapsed for the concept of division of labour to have become well understood by general readers.

Indeed Adam Smith acknowledged as much, since he wrote in the prequel to his famous example that the division of labour has been very often taken notice of. That it might be thought he would

have liked to pass off his description as an original insight, therefore, would have taken him by surprise.

The exposition of division of labour in pin manufacture redounds to the stature of Adam Smith in other ways. Anyone setting out to write close to a million words on economics had better

think of ways to get and keep the attention of the reader. Whereas no business school would today consider teaching a case study based on the pin industry, Adam Smith’s picture of pin

manufacture still is a timeless lesson of business economics in a nutshell. If the kudos for pointing out the workings of division of labour go to Adam Smith rather than to anyone else, then

applying Stigler’s Law shows that not the least of Adam Smith’s skills was his ability to engage his readers.

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