What Did Adam Smith Say About Self-Love?

How should we interpret what Adam Smith said about self-love in book 1, chapter 2 of The Wealth of Nations (WN 1776)? Smith's explanation of the role of self-love in motivating parties to exchange has been widely misunderstood. Understanding the textual setting of his reference to self-love is crucial to a correct interpretation. The first two chapters of WN must be read as a whole and in light of Smith's idea of sympathy from the Theory of Moral Sentiments (TMS 1759) to get the full meaning of the appeal to self-love. No necessary contradiction or dichotomy exists in Smith's two treatments of human behavior in TMS and WN, as shown by a close examination of his reference to self-love in WN. This article shows that the division of labor, complex production, and consumer needs and wants are the starting points for the analysis, not selfishness. Smith assumes that people are capable of both benevolence and self-love. He explains that an appeal to a merchant's benevolence provides a few of our needs at particular times but not all of our needs and wants all of the time. Smith's discussion of self-love did not point to purely selfish behavior but to the efficiency of appealing to the merchant's self-love rather than to his charity. Criticisms of Smith as the one who turned political economy into the science of egoism or as the one who implied that greed is good are not warranted by his mention of self-love. Appealing to others' self-love is less egoistic than begging and generally more beneficial to society. Furthermore, a focus only on self-love versus benevolence misdirects our thoughts on the forces necessary for social cohesion, as a final quote from TMS will show.