Father of capitalism Smith 'misunderstood'

THE work of Adam Smith, the Edinburgh philosopher hailed as "the father of Capitalism", has been widely misinterpreted, a leading economics expert has claimed.

The 18th century economist, who is buried in the Canongate Kirkyard, is set to be celebrated with a new statue on the Royal Mile.

But Professor Gavin Kennedy, of Heriot-Watt University’s Edinburgh Business School, says his legacy has been misunderstood in many quarters.

Prof Kennedy points out Smith would not have even recognised the word "capitalism".

He also says the 18th century thinker would not have approved of the laissez-faire economics which his name is often used to champion today.

In his work, Adam Smith’s Lost Legacy, Prof Kennedy argues that Smith’s moral philosophy had been mistakenly placed in the context of an economic system which had not yet been invented when he wrote.

Prof Kennedy said: "The image we have today of Adam Smith’s intellectual legacy is largely based on interpretations of his seminal work The Wealth of Nations by economists who were pursuing different agendas to create ideas and policies which Smith himself did not advocate."