2026/06/08 by Glory M. Liu, Barry R. Weingast · 1 voice
Social Sciences · #American Constitutional Law and Politics #Commonwealth, Australian Politics and Federalism #Political Philosophy and Ethics
paper · doi:10.1215/00182702-12636636
openalex publication_date 2026/06/08 · openalex created_date 2026/06/09 · openalex updated_date 2026/06/11
Abstract This article offers a new way to read Book V of The Wealth of Nations and argues that it contains a robust, integrated, and underappreciated theory of modern state capacity. Though many scholars have offered detailed analyses of distinct topics contained within Book V—for instance, Smith's position on standing armies, education, his “maxims of taxation”—few have treated the final book as a culminating and coherent argument about modern statecraft. Modern states have the unprecedented ability to expand markets and generate wealth, but they were also uniquely vulnerable to new forms of elite predation and capture. For Smith, modern state capacity was a historically necessary response to the vestiges of premodern, precommercial arbitrary power. By examining Smith's treatment of four key topics—defense, the administration of justice, taxation, and public debt—we show how these functions are interwoven into a broader vision of modern state capacity, or, put simply, what modern states do and how they do it. Recovering this theory of state capacity offers a different understanding of “Smith's politics” that transcends interpretations that treat politics either as interference, or as a position on a specific policy.