The Wealth of Nations Book Summary - The Wealth of Nations Book explained in key points
Listen to the Intro

The Wealth of Nations summary

Adam Smith

The most influential economic book of all time

4.4 (835 ratings)
11 mins
Table of Contents

    The Wealth of Nations
    Summary of 4 key ideas

    Audio & text in the Blinkist app
    Key idea 1 of 4

    A division of labor increases productivity; a marketplace enables people to specialize.

    Imagine you want to start a factory to produce pins, and hire an uneducated worker to produce them.

    Your worker performs all 18 steps in the process of making one pin by himself, and the result is rather poor: he barely produces a single pin in a work day.

    But what if you hired a team of 18 uneducated workers, employing a division of labor, so that each worker specializes in one of the 18 steps?

    Would the result be just 18 pins per day? Not really; the team could produce almost 50,000 pins a day!

    A division of labor significantly increases productivity. But how does it work?

    When one worker has to switch between many different types of work, it costs time. By employing a division of labor, one worker can focus on one skill; and that wasted time is turned instead into productive time.

    What’s more, people are more likely to innovate in areas where their whole attention is devoted to a specific task. Innovations in turn result in increased productivity.

    For example, the first fire engines were greatly improved when a boy employed a string to open and shut the truck’s water valve. Unsurprisingly, the boy’s job before this invention was to manually open and shut the valve!

    As productivity increases, a surplus of unwanted products often results, which can be then traded away. For instance, a butcher who finds himself with a surplus of meat could trade the meat for bread from the baker.

    But what about products that aren’t in demand? What if the baker doesn’t want the butcher’s meat?

    This predicament is why money was introduced. The butcher can sell his meat to whomever is a willing customer in the market, and then use the money to purchase bread from the baker.

    And what if the butcher doesn’t want bread, but rather cheese? He can go to the market and buy cheese with the money he earned from selling his meat.

    In this way, people are able to specialize in their respective crafts or fields, another kind of division of labor. A division of labor increases productivity; which in turn gives rise to the market where craftsmen can trade surplus produce.

    Want to see all full key ideas from The Wealth of Nations?

    Key ideas in The Wealth of Nations

    More knowledge in less time
    Read or listen
    Read or listen
    Get the key ideas from nonfiction bestsellers in minutes, not hours.
    Find your next read
    Find your next read
    Get book lists curated by experts and personalized recommendations.
    Shortcasts New
    We’ve teamed up with podcast creators to bring you key insights from podcasts.

    What is The Wealth of Nations about?

    The Wealth of Nations is a profoundly influential work in the study of economics and examines exactly how nations become wealthy. Adam Smith advocates that by allowing individuals to freely pursue their own self-interest in a free market, without government regulation, nations will prosper.

    Best quote from The Wealth of Nations

    The sole use of money is to circulate consumable goods.

    —Adam Smith
    example alt text

    Who should read The Wealth of Nations?

    • Anyone who wants to understand the foundations of capitalism and the free market
    • Anyone curious about the core tenets of a fundamental work of economic theory

    About the Author

    Adam Smith was a Scottish philosopher and economist, often called the “father of modern economics” as he was first to advocate a free market as the road to prosperity. The Wealth of Nations is his magnum opus and a work that is still influential today.

    Categories with The Wealth of Nations

    Books like The Wealth of Nations

    People ❤️ Blinkist
    Sven O.

    It's highly addictive to get core insights on personally relevant topics without repetition or triviality. Added to that the apps ability to suggest kindred interests opens up a foundation of knowledge.

    Thi Viet Quynh N.

    Great app. Good selection of book summaries you can read or listen to while commuting. Instead of scrolling through your social media news feed, this is a much better way to spend your spare time in my opinion.

    Jonathan A.

    Life changing. The concept of being able to grasp a book's main point in such a short time truly opens multiple opportunities to grow every area of your life at a faster rate.

    Renee D.

    Great app. Addicting. Perfect for wait times, morning coffee, evening before bed. Extremely well written, thorough, easy to use.

    People also liked

    Start growing with Blinkist now
    28 Million
    Downloads on all platforms
    4.7 Stars
    Average ratings on iOS and Google Play
    Of Blinkist members create a better reading habit*
    *Based on survey data from Blinkist customers
    Powerful ideas from top nonfiction

    Try Blinkist to get the key ideas from 7,000+ bestselling nonfiction titles and podcasts. Listen or read in just 15 minutes.

    Start your free trial