WORLD HISTORY

Detailed explanation-1: -We know Adam Smith today as the father of laissez faire ("to leave alone") economics. This is the idea that government should leave the economy alone and not interfere with the “natural course” of free markets and free trade.

Detailed explanation-2: -The theory of laissez-faire was developed by the French Physiocrats during the 18th century. Laissez-faire advocates that economic success is inhibited when governments are involved in business and markets.

Detailed explanation-3: -Smith believed that government’s proper roles in society should be limited, but well defined: government should provide national defense, the administration of justice, and public goods.

Detailed explanation-4: -In fact, he believed that government had an important role to play. Like most modern believers in free markets, Smith believed that the government should enforce contracts and grant patents and copyrights to encourage inventions and new ideas.