When last we met, Earthmother was being very perceptive, and zeroed in on a troubling point:

quote:

---

" The habit of sauntering and of indolent careless application, which is naturally, or rather necessarily acquired by every country workman who is obliged to change his work and his tools every half hour, and to apply his hand in twenty different ways almost every day of his life, renders him almost always slothful and lazy, and incapable of any vigorous application even on the most pressing occasions. Independent, therefore, of his deficiency in point of dexterity, this cause alone must always reduce considerably the quantity of work which he is capable of performing."

So he is saying that those in assembly line work are better craftsmen and more dilligent and attentive to their work?

In the summation of the chapter he acknowledges the various 'industries' that go into the making of a woolen coat and yet this is not so very different than the efforts of the 'savage' societies where the talents of all are required.

Is this the period of time when young women were leaving home to work in the mills and such. If so how did he assume that the terrible conditions which were imposed upon these workers - some of whom were children- made them more adept or better offf than those country workman or the savages?

---

I meanwhile had fashioned a reply which I managed to delete, and which I will now set to retyping.

If people don't mind, I did want to make two observations that are more supplementary than analytical (ie: I am a footnote).

My first reason for being utterly delighted -- dee-lighted! -- by chapter 1 is Smith's close attachment to, continual reference to, real human beings in real human situations. On the surface of it, as earthmother observes, what he says about people and how they work best raises for her, and us, an immediate, maybe disturbing question of how good the work is for the people. At an analytical level, I assume that's a question that will keep bothering us.

And yet in another sense this writer is so palpably, essentially, a humane thinker. I see, for instance, as soon as he starts talking about the "manufactories" of his time, proof that Diderot was right in believing that it would make an immediate, political, difference if all citizens knew a little bit about the work that all other citizens do, which is why Diderot insisted on all those long articles about the skilled crafts and trades in the Encyclopedie, most of which he wrote himself because the other philosophes were preoccupied by what they considered more elevated issues ... (Intellectuals, eh? Some things never change.)

But here it is -- even without the footnotes, I would have known that Smith had gobbled those articles up -- historically, that is such a fast pay-off for Diderot's conviction that we must know each other. I will have to do some checking to find out whether Denis (who died in 1784) had a chance to read Smith -- but boy, if he had, och, how thrilled this must have made him. I cannot tell you how happy I was for Diderot all the way through this chapter.

My second observation is literary. Is it possible to read that last para without being struck by its heightened rhetoric, especially when we get to that extraordinarily long sentence beginning "Were we to examine," mid-para, which then continues almost to the end of the para? Some crescendo, yes?

I do have some analytical comments to make, some about things that disturb my li'l socialist conscience -- but I had to register my poetic enthusiasm for this stuff first. Some day I'm going to argue quite hard that it is the very aesthetic complexity of texts like this one that puts the lie to a lot of social-scientific cliches and platitudes about the C18 ... But ok, ok, I'm signing off now, I'll go, I'll go ...

(Denis, you did it! you did it! whee!!! )

quote:

---

Of Sympathy

How selfish soever man may be supposed, there are evidently
some principles in his nature, which interest him in the fortune
of others, and render their happiness necessary to him, though he
derives nothing from it except the pleasure of seeing it. Of this
kind is pity or compassion, the emotion which we feel for the
misery of others, when we either see it, or are made to conceive
it in a very lively manner. That we often derive sorrow from the
sorrow of others, is a matter of fact too obvious to require any
instances to prove it; for this sentiment, like all the other
original passions of human nature, is by no means confined to the
virtuous and humane, though they perhaps may feel it with the
most exquisite sensibility. The greatest ruffian, the most
hardened violator of the laws of society, is not altogether
without it.

---

Just to give a slightly different picture of Smith the man than one may have gotten from his effusive praise of repetitive work.

I agree with you that he's quite humane. I wonder how much of his knowledge of factories and so forth was obtained first hand, and how much from sources like the Encyclopédie. A bit of both, I should imagine. Clearly he takes an interest, and has some imagination for what it's like to be those people.

As for his style, I'm actually quite partial to the prose of the 18th century, which violates all the supposed rules of good taste of our own era (lots of periodic sentences like the last one of Chapter 1).

OK Skdadl, watches synchronized.... are you ready to go?

I was going somewhere with this but my train of thought disembarked without me.

quote:

---

Prospective franchisees were told: "Both machines have been thoroughly perfected . . . are of foolproof design - can be easily operated even by a moron."

The fools turned out to be the designers - the machines didn't work - but faith in science and technology remains strong in the fast-food industry. It abounds with contraptions like the Lamb Water Gun Knife, which makes french fries by firing tons of potatoes out of a high-pressure hose at eighty miles an hour through a matrix of blades.

---

quote:

---

A great part of the machines made use of in those manufactures in which labour is most subdivided, were originally the invention of common workmen, who, being each of them employed in some very simple operation, naturally turned their thoughts towards finding out easier and readier methods of performing it.

---

Unfortunately, both my editions mention that the story about the boy who modified the steam engine is nothing more than a fancy. Oh well.

Finally, in this context, I couldn't but be struck by Adam Smith's claim that

quote:

---

the invention of all those machines by which labour is so much facilitated and abridged, seems originally owing to the division of labour.

---

Again, this is just the opposite of the prevailing wisdom today.

Now, returning to the beginning. Smith says the "THE greatest improvement in the productive powers of labour, and the greater part of the skill, dexterity, and judgment with which it is anywhere directed, or applied, seem to have been the effects of the division of labour." Well he doesn't mention anything else but we can think of some other things -- general education, health, spiritual well-being. A sense of empowerment (the best correlate to wealth among countries is the quality of institutions, particularly democratic institutions: which came first? Who knows?). Why doesn't Smith talk about these? I gather, notwithstanding his humaneness, it's because these are intangibles that don't really fit into a project seeking to work out the laws of wealth from neat first principles. (Newtonian rationalism again.) Is it really true that ever more minutely divided tasks will go on improving overall productivity?

quote:

---

The division of labour, however, so far as it can be introduced, occasions, in every art, a proportionable increase of the productive powers of labour.

---

Again, Smith ignores the intangible of well-being and wholeness that would suggest the answer "no", the answer that Mill and Smith's contemporaries provided.

Still, it seems to be true that to a large extent Smith has put his finger on a major characteristic -- whether cause or not seems moot -- of advanced economies is the division of labour.

As skdal has noted, Smith's vision at the end of the chapter is quite grand. It put me in mind of the oldness of globalization, which has been going on since the dawn of history. Smith appreciated and marvelled at the great, complex spectacle. Question: what is it, then, that is *actually* new about the globalization we are presented with today?

Finally, Smith interestingly notes that agricultural products in richer countries aren't necessarily cheaper than those in poorer countries. Of course, he's pessimistic about the possibility of dividing labour in agriculture, but has since been proved wrong on that count (but not about his general thesis on the division of labour). With the vast mechanization of agriculture, the use of pesticides etc., productivity in developed countries has increased (but temporarily, and at what cost?). Which is why developing countries will never compete with the North in agriculture, and why the argument that they should, which we hear from globalizers, is a dishonest manipulation.

The modern idea of productivity, my editions note, makes its first appearance here in Smith. I can't find where it says that right now, though.

[edited to note the most important thing of all: Audra has demoted me from "sage rabbler" to "helper elf". It's an outrage! The embarrassment'll be the death of me! Audra, you meanie. You, you, you...big sister, you. ]

However, having rectified this, I'd like to take the plunge myself and make some notes of my own.

It is apparent, as rasmus has said, that Adam Smith grasped the notion of worker productivity and managed to portray it in relatively simple terms. The case can amply be made that in sophisticated manufacturing operations - as in his example of the pin factory, the combination of an increased number of workers (as opposed to the single craftsperson) and machinery, along with specified tasks for each worker in the chain of events that makes one item, results in enormously higher levels of output. Adam Smith even put forth the notion of the determination of worker productivity in terms of output per worker. This, as we have seen in other threads, is easily extended across the economy as a whole, or concentrated to one industry.

Smith also makes some curious comments about productivity in agriculture being lower than that of manufacturing in the industrialized nations, and he also strikes a key point that I would like to highlight:

quote:

---

This impossibility of making so complete and entire a separation of all the different branches of labour employed in agriculture is perhaps the reason why the improvement of the productive powers of labour in this art does not always keep pace with their improvement in manufactures. The most opulent nations, indeed, generally excel all their neighbours in agriculture as well as in manufactures; but they are commonly more distinguished by their superiority in the latter than in the former.

---

(Italics added)

I wish to bring this point out for several reasons. First of all, it is clear that the growth strategy of the industrial nations, as I have pointed out in an essay on the defects in some of the arguments of the free traders, has been to concentrate trade protection (in the case of the USA) or natural hegemony (in the case of Great Britain in setting up its mercantilist policy) on manufacturing in order to stimulate production of consumer and capital goods, thus increasing the rate at which reinvestment can occur to further boost material output.

Second of all, the examples given bear out Smith's statement that productivity in manufacturing can be boosted to much higher levels than in agriculture. Such examples are based on the fact that (at the time) the prices of agricultural goods tended to be uniform across nations and not much affected by industrial advantage. By contrast, consumer goods prices were affected to a great deal by the strength of the manufacturing base.

Incidentally, it appears that Adam Smith did indeed acknowledge the issue of slacking-off.

Further on, we note that improvements in the manufacturing process appear to emanate both from "learning by doing" as in the example of the boy whose use of a string to connect the valve of a machine to the piston (although it appears to be apocryphal), as well as from generalists who design the machines and witness them in application.

Other analysts, however, have written of the importance of productivity gains from workers' intimate knowledge of the way they do things and their suggestions on how to change the way things are done to make them more efficient.

As a final word, it is interesting to note Smith's continued focus on labor to the exclusion of capital. Virtually no mention is made of the process by which labor is employed, nor does he discuss the principles of capital formation (ie. investment).

First, rasmus:

quote:

---

Which is why developing countries will never compete with the North in agriculture, and why the argument that they should, which we hear from globalizers, is a dishonest manipulation.

---

I'm confused about the which and the why there -- I'm not sure still I understand the why -- ? I feel I need to understand this point, which I couldn't make on my own.

Second, anyone: A dumb question: Is it necessary that productivity should continue to increase indefinitely? Is it only neo-lib economists and ideologues who think this, as they appear to me to do, or is this a necessary and/or good thing?

I was interested in the discussion of the state of the textile trades (para 4) as Smith knew them. This led me to put together two odd historical facts that just happen to be rattling around in my memory. I know that in some parts of Britain, "the linen and woolen manufactures" had already been broken down into all those different trades Smith lists from the Middle Ages -- social and cultural life in market towns like Shrewsbury, eg, were dominated by a glorious welter of craft and trade guilds from when -- the C12 or C13? And yet in other places -- eg, the Hebrides, Lewis and Harris (home of Harris tweed) -- well into the C20, spinners were indeed weavers too; all the operations Smith lists were done communally by a small group moving from stage to stage.

The reference to the effect of "the present high duties upon the importation of raw silk" escapes me -- ?

I have smilies all down the sauntering para, partly because, as others have noted, there are so many questions to be raised about Smith's certainty of his narrow opinion here; but also because I live with a good deal of multi-tasking forced upon me, and I'm here to tell you that I've lived some of this on the pulse. Often, when I have to turn my hand from one sort of employ to the next, I am less than keen and hearty about the new work, and can I trifle! for some time!

I am left meditating on Smith's interest in the virtue of focusing on one small thing/task/stage. I also believe that such focus produces special productivity (genius, even) when the object of the focus is inherently interesting; but if I were one of those eighteen people engaged in polishing just my one bit of the part of a pin, I wonder whether I might not become even more indolent than our careless saunterer.

I was amused, too, by Smith's optimism about the progress of philosophy, similarly speeded along by its contemporary subdivision.

Something about our splendid concluding para is producing a faint ringing of bells in my memory, a faint echo of something else, but I haven't managed to dredge it up yet.

Otherwise, thank you all, guys, for all the hard work and guidance.

("helper elf" -- yeeeeeheeheeheeheehee!)

quote:

---

Which is why developing countries will never compete with the North in agriculture, and why the argument that they should, which we hear from globalizers, is a dishonest manipulation.

---

Skdadl was wondering about this point. For it to be perfectly, sparklingly clear, skdadl, you had to have been the one who wrote it -- at 4 in the morning or whatever it was.

quote:

---

but they are commonly more distinguished by their superiority in the latter than in the former.
(Italics added)

I wish to bring this point out for several reasons. First of all, it is clear that the growth strategy of the industrial nations, as I have pointed out in an essay on the defects in some of the arguments of the free traders, has been to concentrate trade protection (in the case of the USA) or natural hegemony (in the case of Great Britain in setting up its mercantilist policy) on manufacturing in order to stimulate production of consumer and capital goods, thus increasing the rate at which reinvestment can occur to further boost material output.

---

I think I know what axe you're grinding here, guru-ji.

quote:

---

Second, anyone: A dumb question: Is it necessary that productivity should continue to increase indefinitely? Is it only neo-lib economists and ideologues who think this, as they appear to me to do, or is this a necessary and/or good thing

---

Economists of all stripes (and whiskers ) agree that positive productivity growth is a key to increasing economic output without requiring, for lack of a better phrase, brute force.

The difference of opinion lies in what the prescription is for low productivity growth. Right-wing economists tend to link growth in productivity to policy measures that result in more of an unrestricted free-market character to the economy. The theory goes here that corporations, in having to obey the myriad collection of laws and regulations they do, must thus divert some of their resources from capital investment. In addition, their general consensus on how investment is to be stimulated hinges on an explanation for human behavior in regard to savings that is highly sensitive to interest rates - in practice, only the ultra rich shift their savings portfolios in immediate response to changes in interest rates.

Left-wing economists have various schools of thought on the subject. James Galbraith has an excellent ditty on this, incidentally.

Some leftist economists such as Robert Reich may be termed "education supply-siders". In their view, a "skills gap" is being created in advanced economies, which is stifling productivity growth as workers struggle to retrain for these new jobs. So, to the education supply-siders, the key to boosting productivity is to maintain a highly-skilled, diverse workforce.

Other left-wing or left-leaning economists, such as Jim Stanford and Ravi Batra, point to poor capital investment and a poor savings rate (note: savings still largely forms the backing for investment even in a world that does not obey Say's Law) as the principal cause of poor productivity growth. In their view, changes to the tax system and a shift in the basic nature of where the best rates of return can be found, have caused corporations to reduce gross and net fixed investment - which in turn has reduced productivity growth.

quote:

---

It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from their regard to their self-interest. We address ourselves not to their humanity, but to their self-love, and never talk to them of our necessities but of their advantages.

---

quote:

---

The difference of natural talents in different men is, in reality, much less than we are aware of; and the very different genius which appears to distinguish men of different professions, when grown up to maturity, is not upon many occasions, so much the cause, as the effect of the division of labour.

---

[I've added these comments since then]

The chapter has two impressive moments, I think. One is where Smith almost surreptitiously introduces the view of human nature that I suspect will lay the foundation for the book. I've been reading bits of his The Theory of the Moral Sentiments and it's interesting just how different the picture of human nature that is presented there is. I don't think that Smith changed his mind in the meanwhile, but I do think the project of WN, like that of economics, depends on a very particular view of human nature and rationality. Insofar as that view is wrong, I think the whole subject founders. Yet the view itself has its own power, if enough people believe it; and certainly enough people believe in the self-interestedness of human nature. I think Smith's ideas not only explain (perhaps), but also have powerfully shaped the development of capitalist society. Why is a theory of human nature, if internalized, important? Because it (ideally along with the emotions, the sentiments) is the starting point for your decisions about how to behave, and how to interpret others' behaviour. Clearly if enough people assume that everyone is self-interested, this belief itself will powerfully work to create self-interested behaviour. (I know game theory is a boys' game, but it becomes very easy to see how much outcomes can change based on a strong starting assumption like the self-interestedness of agents.)

The second impressive moment is where he describes, after the prologue on bartering (isn't that dog example stupid?), how a "primitive man" will specialize in arrow-making to purchase whatever else he needs out of his surplus labour. "Surplus labour" is an impressive, big new concept, I suppose. Smith is of course only speculating about primitive societies. There was a fascination in the 18th century with explaining the origins of institutions by imagining humanity in its primitive condition. We see that in social contract theory, and in speculations on the origins of language, a very popular subject at the time. It's all part of fetishizing a mechanistic world view in which primitive givens + laws of interaction produce complex events. It doesn't mean I think Smith is wrong, it's just interesting to note that his thought is very much a product of his times.

quote:

---

Productivity cannot be so much improved in agriculture as in manufacturing. Weathy countries will show their superior productivity in industry more than agriculture.

---

A caveat: Adam Smith's statement on this subject may very well have been valid at the time, but I can tell you that disaggregation of the productivity statistics in the USA in particular show that productivity growth in agriculture has been at a faster rate than that of the US as a whole (5.8% per year 1950 to 1975, and 3% per year thereafter; for the US economy as a whole, productivity growth from 1950 to 1975 was about 3% per year; post-1975, 1.5% per year).

quote:

---

the market: by the late seventeenth century the emphasis of the word has changed from a reference to the point of sales to the more elusive concept of consumption controlled by supply and demand, though the two meanings continue to be invoked often at the same time, with the more physical sense of a market-place nostalgically contesting the abstract ground of the later usage. At WN III.ii, for example, we discover Smith attempting to release trade from the market as place, where the market-place appears to resist the notion of 'natural' pricing.

---

On chaps 2 and 3, just a few small observations to add.

You write:

quote:

---

Modern descendants of Smith will even describe altruism as self-interested because it "has utility" for the giver. But if "self-interest" can describe just about any transaction, what sort of work does this idea do?

---

Ah, yes, that old game. Has anyone not run into one of these guys: he announces that all human behaviour is self-interested; the well-intentioned innocent spends twenty minutes or so working to come up with examples of exceptions; but the smug fellow can redefine absolutely any behaviour as self-interested ... At which point it might occur to a student of logic and language that this is a semantic game, nothing more: define "self-interest" to equal "all human behaviour" in the first place, and, um, ... As rasmus asks, what sort of work could such a broad definition do, even if it weren't a cynical ploy?

However, rasmus, would you agree with me that Smith is nowhere near those guys -- that maybe even calling them his "descendants" is illegitimate -- -- why don't we take a leaf from John Ralston Saul and call them his bastards?

Notice that Smith does not say that we all act out of self-interest (and only that) in the first place; he says we appeal to others on the turf of their self-interest. I think that's an important manoeuvre. He also says it is in vain to appeal to others' benevolence only.

I also think it's worth remarking that this discussion arises, again, from Smith's vision of the tremendous interdependence of individuals in "civilized society." It is because "man has almost constant occasion for the help of his brethren" that he can't make friends of all of them, and must therefore appeal to them on some other basis.

I was thinking, as I read that passage, of all the rapacious people I've known who enjoy banging on desks and announcing that they "did it all themselves," that they've never "depended on anyone else for a handout," etc etc etc. Smith is clearly not their ancestor.

(Feminist note: In the image of the greyhounds pursuing the hare, the greyhounds are male, the hare female ...

What do you think "trucking" meant to Smith? It's lovely the way he uses it: "so it is this same trucking disposition" -- ?? Is this like "no truck nor trade"? But what did that mean? I often refer to myself as "trucking along," but now that I think of it, I don't know where that expression comes from either.

Smith's conviction that the "natural" differences among "men" are in fact very slight: notable. Note also that he traces the beginnings of differentiation back to the ages of 6 or 8 because, at "about that age, or soon after, they come to be employed in very different occupations." A thought: we must talk some time about Philip Aries, Ages of Childhood, yes?

Surplus labour. I'm always going to have trouble holding this in head. But this helps. Last sentence of chap 2: Another beautiful sentence -- but, as you observe, unsupportedly idealistic as regards disparity of rewards, given what he appears to regard as commonality of usefulness.

Chap 3: I had no independent observations: The extent of the division of labour must always be limited by the extent of the market (which is another way of referring to the power of exchanging). I shall walk about reciting this line until it's committed to memory.

Smith finally catches up to me here on the Scottish highlands, lack of division of labour in same. I very much enjoyed all the water history. Sometime I must talk on the reading thread about Neal Ascherson's beautiful and brilliant book The Black Sea.

quote:

---

What do you think "trucking" meant to Smith? It's lovely the way he uses it: "so it is this same trucking disposition" -- ?? Is this like "no truck nor trade"? But what did that mean? I often refer to myself as "trucking along," but now that I think of it, I don't know where that expression comes from either.

---

There's an expression that goes "to have no truck with" - an example would be "I'll have no truck with leaving these guys behind". It loosely means "deal" or "dealings" in the context.

quote:

---

Sir, I'm here, Sir -- sorry I'm late, Sir, but the dog ate my -- oh, that's right, you know I don't have a dog ... You fall for sick grandmothers? No? Lightning strikes?

---

*peers over glasses silently, impassively, without emotion, then returns to reading. After twenty seconds' pause* Do you have a question?

[I've got the frosty professor thing down.]

quote:

---

However, rasmus, would you agree with me that Smith is nowhere near those guys -- that maybe even calling them his "descendants" is illegitimate -- -- why don't we take a leaf from John Ralston Saul and call them his bastards?

Notice that Smith does not say that we all act out of self-interest (and only that) in the first place; he says we appeal to others on the turf of their self-interest. I think that's an important manoeuvre. He also says it is in vain to appeal to others' benevolence only.

---

quote:

---

I also think it's worth remarking that this discussion arises, again, from Smith's vision of the tremendous interdependence of individuals in "civilized society." It is because "man has almost constant occasion for the help of his brethren" that he can't make friends of all of them, and must therefore appeal to them on some other basis.
I was thinking, as I read that passage, of all the rapacious people I've known who enjoy banging on desks and announcing that they "did it all themselves," that they've never "depended on anyone else for a handout," etc etc etc. Smith is clearly not their ancestor.

---

quote:

---

A thought: we must talk some time about Philip Aries, Ages of Childhood, yes?

---

quote:

---

Disclaimer: I don't like scoring points. I don't mind if anyone else does, but doing it myself scares and depresses me.

---

I know what you mean about "scoring points," I think. It's an unpleasant masculine tendency, the public put-down being the most unpleasant example of it. Or am I reading you wrong here? Anyhow I didn't mean too much by the expression....

Adam Smith starts off by commenting that humans have developed unique mechanisms for allocating resources and in forming interrelationships that depend on mutual benefit. I daresay he has more "collectivist" tendencies than the right-wingers would care to admit!

He goes on to elaborate as to how differences in the skills and talents of humans give rise to natural divisions of labor. It is, as indicated in the previous chapter, on this division of labor that advancement in the human condition hinges on, since specialization results in the collective interdependence of humans bringing forth more material output and more progress than would be possible by each person trying to work singly.

However, much to the chagrin of the conservatives who insist that all humans are inherently destined (shades of Calvinism pervade their thought, I think) to certain things - Smith remarks that a good deal of what makes people develop their talents and skills depends more on education and social custom.

quote:

---

The difference of natural talents in different men is, in reality, much less than we are aware of; and the very different genius which appears to distinguish men of different professions, when grown up to maturity, is not upon many occasions so much the cause as the effect of the division of labour. The difference between the most dissimilar characters, between a philosopher and a common street porter, for example, seems to arise not so much from nature as from habit, custom, and education. When they came into the world, and for the first six or eight years of their existence, they were, perhaps, very much alike, and neither their parents nor playfellows could perceive any remarkable difference. About that age, or soon after, they come to be employed in very different occupations. The difference of talents comes then to be taken notice of, and widens by degrees, till at last the vanity of the philosopher is willing to acknowledge scarce any resemblance. But without the disposition to truck, barter, and exchange, every man must have procured to himself every necessary and conveniency of life which he wanted. All must have had the same duties to perform, and the same work to do, and there could have been no such difference of employment as could alone give occasion to any great difference of talents.

---

To elaborate, then, Adam Smith's comments seem to imply that a society which needs, even requires, division of labor among different persons will tend to cause people to differentiate and specialize more than they would have in, say, hunter-gatherer societies where people were almost interchangeable (after all, almost any male who wasn't blind and deaf could pick berries or kill an animal with reasonable proficiency).

In Chapter 3, he further elaborates on the necessity of specialization and differentiation among people in order to bring about more rapid industrial development.

Here, however, he explores the dynamics: What makes division of labor occur? In Chapter 2, he may be said to have explored the kinematics: What happens in the division of labor?

Again, the notion of worker productivity rears its head, only here it is qualified by pointing out that material output hinges on the demand for that output:

quote:

---

Such a workman at the rate of a thousand nails a day, and three hundred working days in the year, will make three hundred thousand nails in the year. But in such a situation it would be impossible to dispose of one thousand, that is, of one day's work in the year (in the Highlands of Scotland - my addition).

---

The next section goes on to explain how the reduction of labor in transportation (yet another example of increased productivity!) boosts the interdependence of various otherwise unrelated towns and cities and increases the size of the market into which goods can be sold. It should be noted as per the caveat in the footnotes that his examples are likely specific to Great Britain, as it appears Smith was not aware of the extensiveness of overland trade in the Asian countries throughout recorded history.

Even so, his point is clear - industrial development is considerably advanced when the cost of transportation drops (whether by transporting more goods per kilometer, or by lowering the cost of labor attached to that transportation, or both).

There is some expostulation on Smith's theoretical justification for all this, by saying that where water transportation was easiest, civilizations sprung up - which is partly true, but again, as noted in the footnotes, he was not aware of other civilizations such as those that existed in Sumeria.