The Wealth of Nations

Definition

"The Wealth of Nations" is a book written by Adam Smith in 1776, which outlines the principles of free market economics and capitalism. It argues that self-interest and competition are driving forces behind economic prosperity.

Analogy

Think of "The Wealth of Nations" as the recipe book for making a successful economy. Just like how a chef uses a recipe to create a delicious meal, economists use the principles outlined in this book to build prosperous economies.

Related terms

Adam Smith: An economist who wrote "The Wealth of Nations" and is often referred to as the father of modern economics.

Capitalism: An economic system where trade and industry are controlled by private owners for profit, rather than by the state.

Free Market: A type of economy where prices for goods and services are determined by open competition in a free market.