 Hi there, my name is Don Boudreau. I'm a professor of economics at George Mason University and a senior fellow at George Mason's Mercatus Center And I'm here today to talk about Adam Smith and his views on trade and the economy. So let's get started So this question is is In a way asking All right, I can't answer this question without giving my own commentary on the current state of the economics profession By and large economists on the whole again, there are exceptions to every rule, but by and large Economists have a better understanding of the way markets work in general and of the benefits of trade in particular then Does any randomly chosen non economists now? That's a pretty low standard. I have to say Well, while there are a lot of non economists who deeply understand markets and trade the general level of a popular understanding of markets and trade is It's pretty it's pretty poor. There's no criticism of ordinary people It's no crime to be to be ignorant of economics But but economists in general understand it better, but it's getting worse among economists economists don't today spend enough time Pondering the big questions. They don't they don't read the wealth of nations I don't know what the actual numbers are but my guess is that of all the people in the world today Alive who have a PhD in economics The percentage of them who have read the wealth of nations cover to cover is probably in the single digits And maybe probably even the lower the low single digits So the economists aren't so much scholars anymore, you know, pondered the big questions. They've become narrow researchers The notion is that well, they want economics to be a science. I and by the way, I do think economics is a science But a lot of economists they want economics to be a science of the sort that it can't be a science that much more akin to physics or Chemistry and observational science where you just look at fairly simple Objective bits of reality and you report on what you you see that's not what economics is or what it can be if it's going to be successful As a science economics is a science of society society is an incredibly complex Phenomenon it has billions of people Operating in it each with his or her own unique preferences each with his or her own unique bits of of Knowledge and hopes and dreams and expectations all of which are changing and and and To imagine that you can just observe With a very thin theoretical structure And use measure things with statistics and data I think that is to to give the appearance of doing science when in fact what you're doing is Basically witchcraft You're you're observing things that can be easily measured just because they're easily measured And although it looks scientific It's not really scientific because the people who a lot not all the people but but too many of the economists who do this Don't bother to think about about where these data are coming from What is the unseen? behind the the the data To be a good economist you have to understand not just statistics Don't get me wrong statistics are incredibly important. I don't I would never want to give up Having access to statistics, but they don't speak for themselves data never speak for themselves facts don't speak for themselves So we need statistics. We need also a deep understanding of economic theory We need Philosophical appreciation for the foundations upon which society both private society and both the politics of society Are built all the great succumbs all certainly all the ones whom I admire are individuals who are or Were many of them are dead Steeped not just in narrow economic theory, but steeped in intellectual history steeped in history in general Steeped in economic history steeped in philosophy steeped in political science and political philosophy steeped in literature because literature gives you insights into the the human psyche and the human condition I see way too many young economists who who Look at data and then draw conclusions from the data which strike me as just preposterous But the but if you don't understand the economic theory That is necessary in my view to process and understand Economic data you can have the best econometrics in the world You can be the most brilliant econometricians ever breathed and if you don't understand the economics You're going to get it wrong. You will not be able to tell good stories With the data that you process you will not draw the right conclusions from the data that you process and so I Am distressed that so few young economists today actually master economics big especially basic price theory basic microeconomics of the sort that was standard fare among a lot of economists until through the through the 1970s the works of people like Armin Alchin and wronged coasts Jim Buchanan These Harold Demsets the works of these people are just Largely ignored or laughed at as being oh, that's all that's all hat. We're onto something new We're onto doing fancy econometrics and we don't need all that stuff they weren't really scientist in in our sense because We have data we're going to process data and by all means process data data processing is important But data processing absolute theories is is is pointless