The Invention of Capitalism: Classical Political Economy and the Secret History of Primitive Accumulation

...the classical political economy put forth a theory that held that a greater degree of self-provisioning increases the rate of surplus value, other things being equal... At times, classical political economists seemed to take pains to avoid the appearance that they were applying something like this model. For example, Adam Smith, insofar as he addressed the subject, treated the social division of labor as the result of voluntary choices on the part of free people. Even so, on closer inspection, when we review Smith’s works as a whole, we find that he also preferred the use of nonmarket forces to manipulate the social division of labor.

For Steuart, trade first begins with government support of luxury exports.Gradually, inland commerce takes on more significance (Steuart 1767, 1:347–49). Smith, by contrast, saw the acceleration of domestic exchanges as a consequence of the expansion of internal markets. He associated this tendency with ‘‘natural’’ progress as opposed to the contrived commerce that Steuart identified as the motor force (Smith 1976, III.i.8, 380). As a result, Smith wrote as if he would have preferred to wait for the household economy to atrophy on its own as the market withdrew economic energies away from traditional activities.
Smith believed that agricultural society would naturally transform itself into an urban commercial society in short order. In truth, even the towns, which were central to Smith’s theory of economic development, began as artificial units that were granted special privileges by the state (see Merrington 1976, 180–82). Later capital shifted much of its activity to places, such as Leeds, Birmingham, Manchester, where it could be less encumbered by traditional labor regulations. In these rural sites workers no longer passed through apprenticeships, but remained as low-paid underlings (Ashton 1972, 15–16, 94). In the northern colonies of North America, however, towns did seem to develop more like Smith had envisioned the process (see Bidwell 1916, 256–62), but despite his best efforts, the preponderance of the colonial experience flew in the face of Smith’s theory of harmonious economic development.