History, Top Stories

The Father of Capitalism and the Abolition of Slavery

It has become a common trope that slavery and the slave trade is responsible for the industrial revolution, if not our entire modern prosperity. Slavery is often called capitalism’s “dark side.” A recent column in the Guardian claimed the slave trade “heralded the age of capitalism” and Guardian columnist George Monbiot said on Twitter: “The more we discover about our own history, the less the ‘trade’ on which Britain built its wealth looks like exchange, and the more it looks like looting. It meant extracting stolen resources and the products of slavery, debt bondage and land theft from other nations.” The same line has been taken by London Mayor Sadiq Khan, who tweeted: “It’s a sad truth that much of our wealth was derived from the slave trade.”

But what did the “father of modern economics,” Adam Smith, actually think about slavery? And is it responsible for our modern prosperity?

Adam Smith argued not only that slavery was morally reprehensible, but that it causes economic self-harm. He provided economic and moral ammunition for the abolitionist movement that came to fruition after his death in 1790. Smith was pessimistic about the potential for full abolition, but he was on the side of the angels.

Smith’s The Wealth of Nations, published in 1776, contains perhaps the best known economic critique of slavery. Smith argued that free individuals work harder and invest in the improvement of land, motivated by their interest in earning a higher income, than slaves. Smith refers to ancient Italy, where the cultivation of corn degraded under slavery. The cost of slavery is “in the end the dearest of any,” Smith writes.

His thinking about slavery can be traced further back. In the Lectures on Justice, Police, Revenue and Arms, delivered in 1763 long before Britain’s abolitionist movement was formalised, Smith writes:

Slaves cultivate only for themselves; the surplus goes to the master, and therefore they are careless about cultivating the ground to the best advantage. A free man keeps as his own whatever is above his rent, and therefore has a motive to industry.

Smith describes how serfs in Western Europe—in feudal relationships with lords—were progressively transformed into free tenants as they acquired cattle and tools. Harvests were more evenly divided between landlord and tenant to encourage better use of land, and tenants eventually progressed to simply giving the landlord a sum for lease. As government became more established, the influence of lords over the lives of tenants was also loosened.

Capitalism was, as Marx described, the next stage in human development after feudal slave relations. Smith’s commercial society is in direct opposition to a slave society. Smith, at his core, is an advocate for individuals being free to specialize and trade, including to trade their labor. Everyone acting with regard to their “own interest,” not because of coercion, creates general prosperity.

Smith’s case against slavery is proven by history: The huge uptick in human prosperity came largely after the end of feudal relations and the abolition of slavery and the slave trade. We are many magnitudes richer than when lords held slaves, or even chattel slavery proliferated in the Americas. The setting free of humanity led to extraordinary innovation and entrepreneurialism. This is only possible, as Smith argued, when individuals can benefit from the fruits of their own labor (slaves cannot hold property in their own name, and hence cannot trade or choose to specialise).

We didn’t become rich because a few hundred years ago people toiled on farms in awful conditions. In fact, the opposite. “It was precisely the replacement of human muscle power with that of steam and machines which did away with the vileness of chattel slavery and forced labor,” Tim Worstall has explained.

Nor did the slave trade fund the industrial revolution. Leading economic historian Deirdre McCloskey explains that the slave trade, and the goods produced by slaves, were a tiny portion of foreign trade in Britain. Additionally, slaves were not passive: From Jamaica to St Dominique they rebelled against their masters. Quashing these rebellions was not cheap. More broadly, McCloskey argues that the industrial revolution was spurred by domestic innovations and not trade or minuscule imperialist returns.

Put differently, if all that it took for a country to be rich was historic slavery then countries would be rich in proportion to their historic level of slavery, but this is not so. Just because America had grotesque slavery and got rich does not mean that America got rich because of slavery. Many countries that had extensive slavery in the past, such as former Spanish colonies in South America, are not particularly rich today. There are many alternative, more plausible explanations for human prosperity.

Additionally, just because some individuals made personal fortunes from slavery, does not mean that nations overall benefited very much. In fact, the average person not only got little or nothing materially out of the likes of the British Empire—they also had to pay huge expenses for its defence in various wars, up to and including their own lives. In any case, the claim that imperialism spurred the industrial revolution gets the timeline wrong: Empire required steam and steel ships, and hence came after the industrial revolution had already begun.

So in the end, slavery, the slave trade and imperialism were not only morally disgusting but also of dubious economic value. A small number of people profited from the trade—and they campaigned against abolition. But this should not be confused with a broader claim that our modern prosperity is built on benefits that went to a small number a few hundred years ago.

The moral case

Slavery wasn’t just bad economics. For Smith, slavery was inhumane and evil. In the aforementioned lectures, Smith discusses the brutal treatment of slaves in ancient Rome, where, in the night time “nothing was to be heard but the cries of slaves whom their masters were punishing”:

Ovid tells us that the slave who kept the gate was chained to it, and the slaves who manured the ground were chained together lest they should run away, and what was more cruel, when an old slave was incapable for work he was turned out to die on an island near the city kept for that purpose.

Smith also observed that:

[W]e may see what a miserable life the slaves must have led; their life and their property entirely at the mercy of another, and their liberty, if they could be said to have any, at his disposal also.

Smith’s revulsion at the idea of slavery may indicate some motivated reasoning in the economic arguments; he may have wanted to show that an alternative world without slavery would lead to prosperity in order to bolster the abolitionist case.

Smith was, nevertheless, notably pessimistic about the broader chances of abolition:

[S]lavery takes place in all societies at their beginning, and proceeds from that tyrannic disposition which may almost be said to be natural to mankind… It is indeed all-most impossible that is should ever be totally or generally abolished.

He even thought that as societies got richer they would be able to afford more slaves. Smith downplayed the likelihood that free or monarchical societies, or religion, would lead to abolition. At the time, the British Empire, and many others, were transporting millions of people from Africa across to the Americas in the extraordinarily violent and barbaric practice of chattel slavery—often justified by extreme racism and involving extensive torture and sexual exploitation.

Smith was, thankfully, wrong. This practice would come to an end. Over the coming decades Britain’s anti-slavery movement abolished slavery throughout the British Empire and helped spur the global abolitionist movement. (Chattel slavery never existed under English or Scottish law—though there were some imported slaves under the guise of domestic work.) Parliamentarian William Wilberforce worked, with researchers Thomas Clarkson and Zachary Macaulay, and Quaker and Anglican campaigners, on a life-long crusade against the barbaric practice from the late 1780s. This group became known as the “Clapham Sect,” residing in south west London. They brought attention to the issue, attained wide support from William Pitt to Edmund Burke, travelled the country, pioneered lobbying techniques such as parliamentary petitions, wrote pamphlets, printed badges, and held public meetings.

Smith has been widely credited with influencing the antislavery movement. His work has been described as a “generative site of abolitionist ideology.” Smith provided the economic case against slavery in both the United Kingdom and, later, the United States. His arguments against slavery were quoted in early antislavery material. Wilberforce, who met Adam Smith in 1787, quoted Smith often. Quaker abolitionist James Cropper quoted Smith’s ideas about slavery’s economic inefficiency. Additionally, Smith’s ideas about ethics and empathy, developed in the Theory of Moral Sentiments (where he describes the “levity, brutality, and baseness” of the slave traders), also came to significantly influence the rhetorical strategy of the abolitionist movement. Smith, of course, was not alone. A wide array of liberal thinkers made the case for the supremacy of the individual and against slavery.

These campaigns managed to achieve an extraordinary “collective change of heart,” historian Niall Ferguson has written, in the face of the organised and powerful beneficiaries of slavery. In 1807, Parliament abolished the slave trade across the British Empire, which came to cover hundreds of millions of people. But this was not all. The Royal Navy used its dominance of the sea to suppress the slave trade by foreigners, both seizing slave ships and coercing other countries such as Spain and Portugal into signing treaties committing to end their slave trade.

By 1860, the Royal Navy’s West Africa Squadron had seized approximately 1,600 ships involved in slavery and freed 150,000 Africans aboard those vessels. About 1,587 members of the squadron are estimated to have died from both disease and being killed in action. Freetown in Sierra Leone takes its name from its first settlers, returned slaves by Brits. According to Ferguson: “The freed slaves walked through a Freedom Arch bearing the inscription—now almost obscured by weeds: ‘Freed from slavery by British valor and philanthropy.’” In 1833, slavery was abolished across the British Empire. The British and Foreign Anti-Slavery Society, now known as Anti-Slavery International, was formed in 1839 to stamp out slavery across the globe. It is the world’s oldest human rights organization.

This took far too long. Slavery is, was, and continues to be (in its modern forms) totally repugnant. But what makes the British Empire unique is not its entanglement with the slave trade, which was true of nearly every empire, as Smith explains, but rather its moral crusade against the trade from the 19th century.

It is no coincidence that the birthplace of the industrial revolution is also the birthplace of the global antislavery movement. Slavery is the antitheses to market economies which depend on the voluntary exchange of labor.

Slavery has been a consistent feature of human history; the Enlightenment liberal and Christian thinkers contributed substantially to the case for its abolition. Adam Smith was one of those early thinkers. In 1764, an anonymous American published an anti-slavery pamphlet based on The Theory of Moral Sentiments. The pamphlet concludes on Smith:

How had he bless’d mankind, and rescu’d me!


Matthew Lesh is the Head of Research at the Adam Smith Institute. Follow him on Twitter @matthewlesh.


  1. I wouldn’t be surprised if statues of Adam Smith are being targeted for removal by Woke activists. It doesn’t matter that he laid the philosophical foundations for Capitalism, an economic system that has generated an unprecedented amount of wealth, health and innovation for humanity. The fact that he opposed slavery and helped inspire the abolitionist movement in England is equally irrelevant. He’s a dead white male and is therefore the enemy. According to the blinkered view of superficial socialists, Capitalism is nothing but an engine of exploitation and inequality; in its absence, we’d all be living in paradise. Of course, the truth is that we’d all be equal in our poverty and hardship.

    Woke critics of Western civilization focus exclusively on its flaws (e.g., the 1619 Project), refusing to acknowledge that the West was hardly unique in conquering and enslaving other peoples. A balanced view would recognize that the same civilization which is responsible for the horrors of the Middle Passage is also the first civilization that abolished the institution of slavery. Smith was a brilliant and magnanimous man whose contributions should be celebrated. Thomas Jefferson was a great man as well, despite the fact that he owned other human beings. Intellectually sophisticated people can admire Jefferson et al. for their achievements while recognizing that they participated in a deeply immoral system. Unfortunately, followers of the Woke religion cannot tolerate nuance: anything and anyone who’s impure must be condemned and expunged.

  2. Slavery had nothing to do with the industrial revolution.

    If there is one factor that might determine why it began where it did, it is religious repression.

    The early industrialists: Darby, Black, Watt, Newcomen, etc… were all Dissenters, forced out of proper British society, and away from the major cities, when they refused to swear allegiance to the Church of England. And it was proper British society that was fueled by the slave/sugar cane/cotton cycle for which they had imported African slaves to the Caribbean islands.

    Shunned by government and commerce leaders, the Dissenters moved to the west and north of England, where minerals and coal were available, but labor was not, and neither was religious discrimination.

    Newcomen originally developed the steam engine to pump out the newly developed coal mines, as King James had forbidden the use of wood for fuel, so that England’s forests would be saved to build his navy. Darby started turning out very strong iron by using coke for his smelting furnaces instead of wood, far cheaper than bronze of equivalent strength. Watt refined the steam engine into an efficient device that could create circular motion. Darby took the procedure to create precise cannon barrels, and made large and strong steam cylinders for even larger engines… large enough to power an entire factory.

    With that, the factory could be located near the source of raw goods, reducing the very high costs of transportation - by horse drawn cart over rough roads. Factories could be built larger than what could be powered by a water wheel, and the larger the factory, the less expensive the cost to produce goods. Basic capitalism: maximize profit while minimizing expense.

    To a large degree, it was the high cost of labor that propelled the industrial revolution, by lowering the cost of goods via machinery instead of people, and by cutting the exorbitant transportation costs with steam powered rail transport, and later, predictable steam powered ships.

    But, the original motivation of the Dissenters was to build their own society, away from the prejudice of official England.

    In that regard, the Dissenter industrialists were to succeed beyond their wildest dreams, so much so that within 100 years, they became polite British society by their great wealth… created by reducing the need for manual labor.

    Slavery had absolutely nothing to do with this.

  3. It has become a common trope that slavery and the slave trade is responsible for the industrial revolution …

    One wonders why it took 100,000 years for slavery to get us there.

  4. Great article- very much in line with my own thinking on the subject. In addition, all one has to do to disprove the notion that colonialism was at the root of much of Britain’s wealth, is look up Our World in Data and examine both average incomes and GDP for the UK by year to see that the unprecedented growth in incomes and wealth occurred after colonialism was ended.

    But even if this wasn’t the case, between the systemic mismanagement by Government of most countries economies, Sovereign Debt defaults and punitively high death taxes used as a tool to erode capital (most infamously in relation to the deaths of successive sons amongst wealthier families during the Great War), a great deal of our supposed collective sins have been washed away by time- like the once garish colours which used to decorate the interiors of churches and cathedrals.

    Plus, Piketty’s point on r versus g, when compared to independent sources, tells a story which would tend to suggest it is only very recently that the rate of capital growth has started to outstrip total economic growth- which would mean that regardless how much wealth was generated by slavery or colonialism, its effect would have long since been diluted to the point of non-existence by all the other wealth in our systems. This graph by Science says it all:

    It also doesn’t factor in inflation, or the effects of long-term debt cycles coming home to roost (by socialising risk for capital in 2008, we may have only delayed the problem- and made it an order of magnitude higher, by transferring the liability to the taxpayer).

    A better way to look at history, and one infinitely fairer to all concerned is to look at the extent to which Government has been responsible for setting up conditions in many communities, which inadvertently created a predetermined path to failure at a collective, rather than an individual, level. The evidence here is far more compelling. When intervening to address historical inequities Lyndon Johnson seems to have made almost no provision for the comparative advantage enjoyed by some groups over others. There was also no consideration given to the possibly that welfare might create an environment of state dependence, or that is also might cause fathers to absent themselves from the home, and communities, because of perverse incentives and with nothing short of catastrophic consequences.

    Reagan also bears a measure of responsibility here- and he later admitted that it was one of his worst mistakes. Because if a man has been dependent on welfare his entire life, and suffering from terminally low morale as a result- a meaning void, in which the individual believes they possess no inherent worth, or potential to be of value to others- is it not then reasonable to conclude that he might need help, a hand up, to set him on a healthy course in life? What were they thinking?

    There are other factors. The misguided liberal belief in the sixties that if people were left to their own devices, with an end to policing communities from within, then everything would be just hunky dory- a belief that created a thirty year cycle of violence and crime, which was only mitigated by the introduction of proactive policing in the nineties. As it was spread around the world, and introduced in various jurisdictions, the results were nothing short of miraculous.

    But even here, there were negative consequences. The wholesale embracing and propagation of the super-predator myth by liberal media, and acted upon by the Clinton administration, set the backdrop for an unfolding tragedy of epic proportions. It denied the potential for reform, within the Criminal Justice System itself, at the one place where it is most likely to occur- with early intervention.

    Britain is not known for embracing the European position on the forgiveness of violent crime, but we have managed to steer a middle course, where recidivism rates hover around 30%. These rates skew heavily with youthful offending patterns. It makes sense, given that many working within the prison system, have come to see it as a college for criminals…

    Even Obama shares some degree of culpability. Because when presented with evidence that mainly poor, urban, Black kids living in high crime neighbourhoods, in single mother environments, with aggressive and itinerant men cycling through the home- he chose to follow the advice from his educational theorists that this was evidence of unconscious bias in teaching- instead in introducing a positive male role model surrogacy and mentoring program which might actually have made a difference.

    This not only reinforces the school to prison program, but also forces responsible parents with good kids living in poor, Black neighbourhoods to send their kids to school in peer groups which are likely to account for two years of lost education by K-12 to disrupted classrooms. Little wonder that the poor teachers are unable to escape the inertia of chronically low morale, given that they are effectively living under a Maoist regime, where overzealous bureaucrats scour the system for evidence of racism- unconscious of the irony that they are effectively denying the evidence of the systemic racism which they are so emphatic is all-pervasive, and becoming active participants in ensuring disparate Black outcomes for another generation.

    The Scottish method is the only hope for America, in its current crisis of faith regarding policing and systemic racism. It’s a system based on Proactive Policing paired with extensive community resources, in which everyone from church leaders to social workers and Youth program leaders work with Police, to nudge troubled teens and despondent young men onto a healthy path of economic opportunity. It’s a fundamentally humane and compassionate approach possessed of an extraordinary vision for a better society.

    And the great thing is it also removes structural costs in the long run. Because once they are no longer a generation of slightly older males encouraging younger teenager into aberrant behaviour, the mechanism of gang grooming youth effectively breaks down. By then employers have recognised the utility in taking kids from poorer, rough backgrounds into gainful employment, because they fully recognise that they are fundamentally more loyal and harder working employees, less likely to kick up a fuss in pay negotiation. In an age of austerity, many of these programs have since been shuttered, with economically productive citizens paying taxes, instead of residing in prisons at the taxpayers extent.

    But it’ll never happen in America, where race colours everything, and people simply wont admit that disparate policing is caused by disparate patterns of offending, largely caused by the urban crime phenomena. I actually looked into Scotland in the first place, because I wanted to see what happened in the absence of race. So there is systemic racism, but in the modern context it largely exists because of the polarising effect of race on rational discussion. It obscures the best and most obvious solutions in an endless cycle of recrimination and counter-argument, with both sides set upon framing the narrative to their own liking.

    Hell, we Brits cant even manage it in London:


    This guy is actually right in what he is saying, but he is only looking at half the picture…


  5. Slavery continues to the present day, see e.g. this article in Time or this from Reuters.

    It is difficult for me to even imagine the hardships people risk to escape poverty and oppression in far away countries to make it into the West. But for some reason, the biggest injustice appears to be the “hurtful” experience of seeing statues of Churchill and other white men, or other parts of the cultural heritage of the country they sacrificed so much to get to. And of course, capitalism - the system that made the West rich enough to attract migrants in the first place.

  6. A few years ago I read an op-ed in which the writer referenced the breaking of the baseball colour barrier by Jackie Robinson and Branch Rickey in the '40s.
    At the time and in the decades to follow the attitude ‘a Black man will have to be twice as good as a White man’ in order to succeed was quite common.
    The writer’s point was that while unfair on the face of it, the attitude created a drive to succeed in Black families.
    Work hard, stay in school and you can succeed despite racism.
    Then the politicians showed up to help failing inner city families and created the welfare addiction that clearly hasn’t worked.

    IMO the problem is that socio-economic issues such as inner-city poverty or homelessness have spawned the bigger problem of bureaucratic cottage industries whose very existence depends on perpetuating the problem.
    Usually there’s a combination of sympathy and excuses.
    “It’s not your fault - you can’t get or keep a job because of historical injustice.”
    “It’s not your fault - your people are over-represented in prison because of systemic racism in the justice system”

    So it seems we revisit the same issues, discuss the same topics over and over again but no real change happens other than the bleating “if we only had more funding” for another program, another government study.
    “And don’t forget us come election time because the other guys are going to cut off the funding”

    We are told repeatedly that inner-city schools in Black neighbourhoods are underfunded yet the stats show that not to be true in many cases.
    Yet there never seems to be much talk of removing school catchment boundaries so parents have a chance to send their kids to a better school.
    If your area school is infested with drugs and gangs - too bad for you.
    Who, exactly, wouldn’t want parents to have that option?

    To my mind this is the new slavery.

  7. I do not know if the profits from the slave trade made a significant contribution to developing the industrial revolution. I do know those profits were considerable, and the profits from the incredibly brutal slave-labor sugar plantations in the New World were even larger. But I also know that however much was contributed by these abhorrent means, it was put to good use.

    The industrial revolution is the means by which billions have be raised from abject poverty. It powered the medical and agricultural advances that allowed all those people to survive and be fed (instead of dying in infancy). In England the industrial revolution developed a middle class that forced them to become the first nation in human history to abolish the slave trade and try to enforce that ban worldwide. And in the US, the industrial revolution powered the Union victory that ended slavery over the plantation-agricultural slave-based economy of the South.

  8. Carefule @Geary_Johansen2020. I like using you as my example of a real Quoran centrist (in contrast to the fake self-described centrist), but if you keep writing stuff like this you’re going to be pegged as far-right even by the non-Orwellians.

  9. Yes, school choice is HUGE for fighting the system that keeps our inner cities and a disproportionate number of our black Americans in poverty.

    Hence why Democrats are so opposed to it.

  10. That’s all Chinese parents had to do when Mao turned their kids lose on them.

    How many Soviet parents were executed or sent to gulags because their kids turned them in?

    In the US, kids were told in school to turn in their parents for smoking pot. Probably plenty of fucked up families because of that.

  11. You can tell that slavery was good because of the fine hard working character of US southerners and all that wealth they have down there compared to the north.

    I think it was Sowell who pointed out you could see the difference at the time by looking across a north/south border river where free farms were productive and slave farms still had tree stumps that blocked mechanized agriculture.

    So many refuse liberty and still think government coercion is the right choice, no matter how often we have these terrible examples where anti-liberty ruled the day.

  12. Indeed.

    I once read (I cannot find it now) a rather convincing theory that Heron of Alexandria had invented or adapted most of the technologies that nearly two thousand years later would lead to the industrial revolution.

    However he used them to build toys and self opening doors to impress the masses. In a society that was top heavy with slaves, the idea of labor saving devices was completely unnecessary.


  13. I think it’s more to do with the teachers unions- more Machiavellian motivations are unlikely- they believe a lot of the bullshit about charters, because they simply cannot conceive that they might be wrong. Remember, the Left has a congenital inability to discard bad ideas they are wedded to.

    On of the things we see on a regular basis from Liberals, are pilot programs that only work because they have extraordinary individuals at the helm- then they scratch their in wonder, when the program doesn’t scale well. The usual solution is to attempt to throw yet more money at the problem- which wouldn’t be a problem if it was their bloody money.

    By comparison, Katherine Birbalsingh is achieving great things by simply inspiring other teachers- many of whom come from around the world to view her work. She has explicitly stated that she doesn’t want more money (although she wouldn’t mind it :slight_smile:).

  14. This is a fallacy which applies equally to slavery and colonialism- because the simple fact is that almost all wealth in the world that exists today was created after 1960.

    Roughly 95% of the worlds population lived on the modern equivalent of $1 a day just over two hundred years ago. Perhaps Western civilisation deserves some credit for bringing around 85% of the worlds population out of the most absolute and gut-wrenching poverty, with nothing more than its ideas working as an engine to improve peoples health, wealth and happiness.

    You are right in your divination that there lies a ‘vile maxim’ at the heart of market capitalism, but what you miss is the ‘invisible hand’ leading us up to a better life. This more than anything else, ‘is the moral arc of history’ which Obama mentioned in a 2018 speech. Material advancement is a necessary prerequisite to all social progress.

    Without the Enlightenment slavery would be far more common, women would have no rights and homosexuals would still be killed for nothing other than being themselves. Oh wait- all that still happens- just not in the West.

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