Adam Smith: poverty and famine
My Besterman lecture was a highly critical assessment of Adam Smith’s views on famine. In The Wealth of Nations (1776) Smith claims that in a free market economy famines will never occur. The famines that do occur are, according to Smith, the result of misconceived government interventions to prevent famine – a striking example of unintended consequences. Smith’s argument is that grain harvests never completely fail (as potato harvests do – but Smith does not consider the potato, which was not yet the main crop in Ireland). In a year of relatively bad harvest, price rises serve to ration the consumption of grain, and thus make the limited supply last through the year. Famines occur when governments artificially lower prices and thus cause supplies to run out.
Two texts have stayed in my mind as I have tried to get a grip…
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