Rediscovering Adam Smith: Why Markets Need Morality

With the 250th anniversary of The Wealth of Nations approaching, Adam Smith is often hailed as the father of modern capitalism. But, as Antara Haldar notes in Business Standard, this view misses a vital part of Smith’s thought: he was also a moral philosopher who believed markets are inseparable from ethics.

The Forgotten Moral Philosopher

Many modern interpretations reduce Smith to self-interest and greed. Yet, as scholars from Amartya Sen to Emma Rothschild highlight, Smith never divorced economics from morality. His famous “invisible hand” was never an endorsement of unrestrained desire, it was a metaphor for how individual motives, when guided by virtue, prudence, and civic trust, can generate social benefits.

Why It Matters Today

In an era of inequality, climate crises, and technological disruption, our economy often acts as if ethics are optional. Revisiting Smith reminds us that self-interest can coexist with social responsibility. Civic virtue, institutional design, and moral education are not optional add-ons, they are essential for sustainable economic life.

Bridging the Gap

The modern celebration of Smith as solely the architect of capitalism has sidelined the insights that might guide us today. To build markets that serve society, we must recover the dialogue between morality and economics that Smith began, and which we have yet to finish.

Haldar, A. (08/11/2025). Adam Smith and the moral economy we have lost. Business Standard.