Fortunately, Palgrave has published an English version of the superb Adam Smith: La découverte du capitalisme et de ses limites (ÉditionsDu Seuil, 2019), by Daniel Diatkine. I say “fortunately” because the English edition opens to many readers and Smith enthusiasts a provocative account of Smith's magnum opus, not entirely devoted to (but not omissive of) analytical economic issues, critical of the several naive approaches to Smith as the father of economic liberalism, and concentrated on Smith's criticism of the mercantile system. Besides, and as Diatkine states from the beginning, his account distinguishes three dimensions of capitalism: a political dimension (and here is meant the “mercantile system”), an economic dimension that situates capitalism as the “advanced state of society,” and a historical dimension. The well-known distinction between the four “ages” (the age of hunters, etc.) is included in the historical dimension, which concerns human evolution and its economic stages, property relations included.

Two important angles of Diaktine's book are the emphasis on the Hume-Smith nexus and the attention given to French pre-Smithian political economy. Hume and physiocracy are present in the whole work, beginning in part 1 (economic liberalism) and crossing parts 2 (the commercial system) and 3 (market and capital accumulation).

Concerning Hume, Diatkine emphasizes the connections and distinctions involved in Hume's theory of justice, which encompasses passions and interest along with the insatiable and destructive avidity of human beings: justice as a means to regulate unstoppable selfishness and as an artifice that favors and arouses the interest of men. Special attention is paid to contracts, a type of exchange of promises that depends on the right of ownership—surely, a topic that interests economists. In commenting on promises, Diaktine stresses the irrelevance of bartering in Hume's texts, and he points at the generality of the exchange acts and at the necessity of positing general rules, which brings reputation and obligation to the fore. The comments on Hume will directly lead to The Theory of Moral Sentiments (TMS), first because TMS unveils Smith's explanation of the feeling of obligation.

Obligation is connected to sympathy, and Diatkine relates Smith's impartial spectator to the theatrical game, which represents “the prototype of the political game.” Greed, in its turn, is connected to the “love of system,” one of the keys to understanding Smith's theoretical system. Although the love of system is usually treated as part of aesthetics, it can be transposed into economics and is in fact connected to the accumulation of capital, a decisive topic in The Wealth of Nations (WN). In this sense, the accumulation of capital builds a bridge between TMS and WN. Diatkine's argument lies in the contrasts between the actor and the spectators, which involves the construction of a representative spectator, or the actor's public. If we add to this theatrical representation the capacity for self-judgment, we will approach a theory of action and of the judgment of actions.

Diatkine pushes further the distinctions among different types of human action, introducing the social classes. Whereas workers seek to meet their needs and landowners seek luxuries, merchants and manufacturers seek to maximize the profits of their capital. Since there are no intrinsic limits to the accumulation of capital, the frequently cursed greed is transformed into a legitimate impulse that defines modern commercial society and explains the progressive character of capitalism. Simultaneously, the workers' ambitions are limited by the fact that their earnings vary around subsistence (as established in WN), which establishes limited horizons for their ambitions. That is, whereas the capitalists have unlimited ambitions, which will in a certain way define the logic of an inherently expansive system—capitalism—the ambitions of the workers are limited by their existence as workers, a route Diatkine explores by resorting to TMS's poor man's son dilemma. Taking into account the fact that landlords are characterized by their prodigality, we have thus three classes whose horizons, behaviors, and sentiments are quite different. Diatkine's argument leads us to ponder that pegging the somehow loose notion of self-interest to such different economic agents may be misleading.

The compatibilities and incompatibilities between WN and the French tradition are explored further. In order to stress the subtleties of the French tradition, Diatkine explains (in chapter 1) that laissez-nous faire, in its historical context, meant something very different from any advocacy of general interest. In chapter 4, Diatkine extensively tackles the contrasts between Smith and Quesnay, concluding that, apart from the well-known theoretical differences between the two systems, Smith sees the mercantile system as a by-product of history and not simply as a misguided economic policy. A historical perspective permeates Smith's whole approach to the mercantile system.

Capitalism, in its turn, embodies three classes. Smith is not exactly a pioneer in conferring to classes a special role in political economy, but, apart from the differences between the “agricultural system” and his (Smith's) system, merchants and manufacturers play in WN a definite role: they are special personages of Smith's criticism of the mercantile system, personages who can persuade anyone that their specific demands favor society as a whole. Not to mention that merchants and manufacturers are the agents of capital accumulation; specifically, they are those who save, or who avoid dissipating their earnings in luxury and trivialities. Merchants and manufacturers are complex characters, typical of capitalism.

The accumulation of capital is the central element in Diatkine's reading of Smith; it pervades the entire book, not only being present in the specific chapter dedicated to the matter (chapter 7) but used elsewhere too, for example, to contrast Hume and Smith, and to show how accumulation allows Smith to avoid the blind alley of “greed.” By the way, it is worth noting that WN's book II is generally underread by economists or read at most having in view chapter II, on money and paper money, and chapter III, on productive and unproductive labor. Being concerned with accumulation, Diaktine's approach is quite aware of the role of productive labor. Yet, Smith's treatment of paper money is paradoxical, as far as its point of departure is the economy of circulating capital. Whereas Diatkine is well aware of the dilemmas of Smith's incursion into paper money, I venture he might have not explored to its ultimate degree the importance of the “different employments of capital” (book II, chapter V) in WN's structure, possibly because of the equally limited exploration of the full perspectives of WN's book III, a choice that leaves us without a proper approach to the uses of history by Smith.

Indeed, and after insisting on the ordering of the distinct branches of the accumulation of capital, in book II, Smith proposes to examine in book III “what circumstances in the policy of Europe have given the trades which are carried on in towns so great an advantage over that which is carried on in the country” (II.v.37). The “circumstances” have as their point of reference a historical event, the fall of the Roman Empire, and the concentration of land and power that had arisen in Western Europe. This concentration was reaffirmed by habits and legislation, especially those concerning inheritance. Such a pattern was finally contrasted by the progress of the cities and with a curious effect brought about by distant trade: to put luxury goods under the nose of landlords, thus leading the baronets to reorganize agricultural production, in order to foster surplus.

Notwithstanding its lack of historical accuracy, the story developed by Smith in book III suggests that long-distance trade was already happening under feudalism. Powerful merchants have a long-standing tradition in Europe, and they are part of what later became known as the mercantile system. Even being quite right in saying that the mercantile system was a result of history, not a historical necessity, Diatkine seems to have overstressed its dominance, or Smith's concern about it, in an advanced age only; for instance, Diatkine emphasizes the Seven Years' War and other elements of late eighteenth-century mercantilism. Even acknowledging the importance of these elements, as well their impact on Smith, we cannot forget that WN's basic point—the criticism of the idea that an abundance of money enriches a country—antedates the post-1750 context. The choice of Mun's book as the epitome of the mercantile system, and Smith's comments on the connections between Columbus's adventure and the lust for gold, confirm Smith's attention to the early phases of the mercantile system. If, as Diatkine proposes, the mercantile system is a by-product of history, its range should be larger, despite having been posited by Smith as the “modern system.”

The centrality of WN's criticism of the mercantile system necessarily leads us to money. Diatkine acknowledges that WN marginalizes credit relations—a well-known Achilles' heel of Smith's economics. Paradoxically, Smith's description of Scottish banking, as well as his informed comments on public credit, in WN's last chapter, shows that Smith was at least quite aware of the characteristics of England's banking system and the role of credit. The insistence on equating money and commodities, a part of Smith's criticism of the mercantile system, is possibly the reason for this sort of underplaying of the role of money.

On the other hand, and despite the unending literature on Smith's approach to paper money, the role of money in WN seems to be a subject still open to further studies. To begin with, as far as Smith's approach to money was framed by his critique of the mercantile system, it is worth noting that parts of this critique emerge in passages preceding book IV, for instance, in book I, chapter XI, the “digressions on silver.” In my view, some passages of book I, chapter V, on real and nominal price, uncover valuable elements of Smith's approach to money, here, not as an anticipation of the criticism of the mercantile system but as elements that delve into the vast pre-Smithian literature on money. Diatkine, by holding that the first chapters of WN aim at an “early state,” whereas elements of the “advanced state” are presented in subsequent chapters, somehow attributes to chapter V a limited role. If we have in the first chapters only a “theoretical model of a market economy,” or an economy stripped of its capitalist elements, a monetary economy in its full sense is not present in these chapters. But chapter V covers topics such as the reformation of the gold coin and Locke's controversies over the silver coin. We are here in the realm of capitalism and plunged into controversies that were contemporary with the mercantile system. It is acceptable that the first three chapters of WN are special, in the sense that they situate workers as self-employed, but what can we say of chapters IV and, in particular, V?

To complement the ambiguities around the real content and extent of Smith's digressions on “real” versus “monetary” prices, I will call attention to certain elements that, before chapters VI and VII, bring to the fore the projected design of WN and Smith's indebtedness to the monetary literature that preceded his work. In chapter V, Smith finds in labor the “real measure of the exchangeable value of all commodities,” but he acknowledges that the value of different kinds of labor is hard to compare and that commodities are most commonly compared to commodities. More precisely, they are compared to money, whenever money “has become the common instrument of commerce.” Given that money is a commodity—gold and silver—its value varies. In short, Smith stumbles over a usual problem in many economists' approaches to money: How to hold a variable measure as a standard? And let us note that Smith is not referring to a remote past. He refers to the arrival of Europeans in the Americas and its consequences, that is, to colonial trade, the nucleus of the mercantile system, and, at the same time, to old known monetary practices, such as debasement. In short, Smith plunges into the usual content of the monetary debates of the seventeenth and eighteenth centuries and erects an original system, composed of three measures: money, labor, and corn. If corn and labor as intertemporal measures is a pattern that crosses the whole extent of WN, chapter V's lessons do not apply only—and not even mainly—to stylized precapitalist societies.

From book I, chapter VI, onward, Smith appropriates the French economists' lessons on revenues and associates them with “real produce” and prices. We are then in the realm of a capitalist economy, and Diatkine quite rightly stresses the centrality of accumulation in it.

In a bold, but suggestive, interpretation, Diatkine proposes that the two Smithian economic models—the “early state” and the “advanced state”—involve two types of work. The first one is independent work, whereas the second implies subordination, in its several features. WN's chapters on the accumulation of capital show us that profits directed to accumulation imply the accretion of “productive” workers, thus, a reinforcement of subordination and at the same time a path to economic growth. However, how to evolve from the early to the advanced state? Even though Smith's explanation was not that clear, Diatkine advances a number of provocative and fruitful guesses on the differences between completely independent labor and labor exerted under subordinated relations, whether they are full servitude or modern wage labor. That laborers and capitalists exchange under asymmetrical conditions is a point stressed by many commentators. That the noncompetitive conditions typical of the mercantile system imply benefits to the favored merchants and harm to society in general is also well admitted. Exchange of commodities in principle implies anonymity between exchangers, but the market economy is not always composed of anonymous agents. There are a lot of social and political relationships in real markets—a point Smith proposed concerning the mercantile system, a system that, as Diatkine says, was Smith's actual capitalism. Smith effectively says, in the introduction to book IV, that the “system of commerce” is the “modern system,” or the system of his times. As Diatkine proposes, Smith is presenting us to capitalism—and to its limits.