Question

Describe why the "discovery" of america was one of the "most important events recorded in the history of mankind," according to adam smith. question 1 options:

Answer 1

You didn't list options, but essentially Adam Smith called the discovery of America one of the most important events in history because it led to increased trade and interchange between nations and continents, which brought about economic benefit for those involved.

In his famous book, The Wealth of Nations, Adam Smith said that "The discovery of America, and that of the passage to the East Indies by the Cape of Good Hope, are the two greatest events recorded in the history of mankind."  Both of these events facilitated and encouraged an increase of trade, which led to increased wealth and prosperity.

Historical context:

The basic principles of capitalism were laid out by Scottish philosopher Adam Smith in his influential book published in 1776:  An Inquiry into the Nature and Causes of the Wealth of Nations.  The Nobel-prize winning 20th century economist Milton Friedman said of Adam Smith, "“The key insight of Adam Smith's Wealth of Nations is misleadingly simple: If an exchange between two parties is voluntary, it will not take place unless both believe they will benefit from it."  Smith argued for such voluntary exchanges within a free market system.  He labeled the government-manipulated economic system that was prevailing in his day as "mercantilism," a system in which governments specifically authorized some merchants as the official agents of commerce (rather than endorsing free enterprise).  The mercantilist system also viewed wealth as though there were a fixed amount of it available in the world, represented by precious metals such as gold and silver, and that nations were in competition over who got more of that fixed amount of world wealth.  Smith saw that wealth was something that could be created and increased through voluntary exchange and free trade.  Smith's ideas formed the basis for what we have come to know as capitalism.  For Smith, the expansion of trade that occurred because of the discovery of the Americas and the discovery of sea routes to Asia were ways that wealth could be exchanged and increased more readily.