Adam Smith's Autobiography Analysis - Essay Example

Greater specialization and mechanization lead to more efficiency which leads to more available resources and thus provides a sustaining cycle of increasing efficiency.

            Another of Smith’s great contributions to the science of economics is his description of the importance of trade and free markets on economic growth.  In some ways this is a natural extension of his ideas on the division of labor - when trade is discouraged or transactions in any way penalized, it discourages specialization and thus slows economic growth (Library of Economics and Liberty, 2014).  But Smith also understood the importance of trade on larger scales and historically.  He indicated that the decline in prosperity that followed the fall of the Roman empire was caused in large part by the decline in trade.  The world went from having standard monetary systems, well-kept trade infrastructure and roadways, and relatively safe travel to suddenly having none of those things.  This discouraged people from specializing and retarded economic growth, as each person had to be responsible for building a higher percentage of the things that sustained them.