Exchange, Persuasion, and the Liberal Order

Leonidas Montes ()
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Leonidas Montes: Universidad Adolfo Ibañez

A chapter in Adam Smith’s Wealth of Nations After 250 Years, 2026, pp 63-82 from Springer

Abstract: Abstract This chapter will place Adam Smith’s exchange—understood not merely as a market transaction but as a fundamental human propensity grounded in reason, speech, and persuasion—at the center of his moral philosophy, political economy, and liberal politics. I argue that Smith’s famous “propensity to truck, barter, and exchange” is best read as a foundational claim: human beings are the animals who trade, and exchanging is inseparable from persuasion. Yet, persuasion can degenerate into coercion, manipulation, and faction. Smith’s originality lies in articulating the moral and institutional conditions under which persuasion can become sympathetic persuasion. This interpretation demands fairness in exchange, protection of individual liberty, and rule of law. On this reading, the political economy of commercial society is not an amoral domain governed exclusively by self-interest, but a moralized order whose efficiency and justice depend on institutions that prevent privileges and restraints. Smith’s critique of mercantilism becomes a condemnation of a political economy of rent-seeking and “perverse incentives” that sacrifice the many to the few in a zero-sum game, in contrast with a liberal order.

Keywords: Adam Smith; Exchange; Persuasion; Sympathy; Mercantilism; Liberalism; Jurisprudence; Rule of law; Political economy; Scottish enlightenment (search for similar items in EconPapers)
Date: 2026
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Persistent link: https://EconPapers.repec.org/RePEc:spr:conchp:978-3-032-32299-9_4

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DOI: 10.1007/978-3-032-32299-9_4

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