Anton Muscatelli, economist and Principal of Glasgow University, writes that:

"Tackling the UK’s productivity problem will require long-term public investment in quality education aimed at closing the skills gap and boosting equality – a plan the 18th-century economist Adam Smith would certainly have agreed with.

Smith – whose tercentenary we celebrate this year – was a pioneer of economics. He was one of the greatest thinkers the world has seen and an alumnus of the University of Glasgow. He was tied to education throughout his life; first, as a student at Glasgow aged 14, and later as a teacher, professor, Praeses (unofficial vice-rector) and rector of the university.

Smith’s first great work, the Theory of Modern Sentiments (1759), sets the philosophical foundations for his magnum opus, The Wealth of Nations (1776). Although it is sometimes incorrectly characterised as arguing that markets should operate in an unfettered manner, it is a much more subtle contribution to economic thinking.

It emphasises how the specialisation of labour – when a worker focuses on developing a core skill – was key to driving what we now understand as "productivity" and industrial prosperity. It explains how self-interested behaviour can lead to the effective operation of markets from society’s perspective. It also discusses how constraints to free trade, such as tariffs and other trade barriers, benefit merchants but not consumers.

Despite the very different realities of 18th-century education, Smith would probably have much to say about today’s education system and how universities could tackle issues from accessibility, public provision and the skills gap, to the wider economic challenge of poor productivity."

Read the full article on The Conversation website

First published: 10 August 2023

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