Hume and 'The Progress of Reason'

In his Political Discourses, Hume's account of the gains from trade rested on a two-factor theory of prices, with an emphasis on long-run adjustments governed by factor mobility and price convergence. Hume's vision of global capitalism rested on the belief that financial instruments were increasingly untethered to nation states and that higher wages induced higher productivity. Hume's historical narrative underscored the importance of the Reformation for prompting the mass migration of skilled laborers, the gradual diminution of superstition, the elimination of what he called "profound ignorance," and the spread of independent thought and literacy. For Hume, the modern commercial world was possible because of the gradual evolution of customs and habits, the increased prevalence of frugality, industry, and secular civility. He saw means-end rational behavior-"the progress of reason"-woven right through the modern commercial world. Britain, particularly since the Glorious Revolution, had in his view become the most enlightened and progressive nation yet known, with much potential for economic growth. In these respects, Hume was more closely aligned with the classical economists, Smith, Ricardo and J.S. Mill, than has hitherto been appreciated. (C) 2020 Elsevier B.V. All rights reserved.