Smith on Education and Public Goods
Smith argued forcefully for government-funded education, recognizing that markets alone would not provide it to the people who needed it most.
The Dark Side of Specialization
One of Smith's most striking arguments for public education arose from his own theory of the division of labor. The same process that made pin factories extraordinarily productive also, Smith warned, reduced workers to performing a single simple operation all day. A person whose 'whole life is spent in performing a few simple operations' becomes 'as stupid and ignorant as it is possible for a human creature to become.'
This was not a minor aside. Smith devoted considerable space to the argument that specialization, left unchecked, would degrade the intellectual and moral capacities of the laboring poor. The market would not solve this problem because individual employers had no incentive to educate workers beyond what was needed for their specific task.
