The Wealth of Nations
Book II, Chapter 3
This excerpt concerns saving. Compare the views expressed here with Smith’s views on vanity in The Theory of Moral Sentiments and with Mandeville’s views on spending and saving.
1. An important term that Smith uses throughout this excerpt is “parsimony.” What does parsimony mean?
2 Paragraphs 1-3 . . . what leads to an increase in “the exchangeable value of the annual produce of the land and labour of the country”?
3. Paragraph 4 . . . how does that increase in production occur?
4. Paragraph 5 . . . is saving A Good Thing or A Bad Thing? Why?
5. Paragraph 6 . . . what is the effect of prodigal spending? Why?
6. Paragraphs 7 and 8 . . . which is better – spending or saving?