Economics in Scotland

Scotland has long been a major centre for the study of Economics. In the eighteenth century, the age of the Scottish Enlightenment, economics was a prominent interest with David Hume and Adam Smith all playing a part in the country's intellectual life.

The Scottish Enlightenment was a period of intellectual ferment in Scotland, running from approximately 1740 to 1800. The first major figure of the Scottish Enlightenment was Francis Hutcheson (1694-1746), who held the Chair of Philosophy at the University of Glasgow from 1729 to 1746. A moral philosopher with alternatives to the ideas of Thomas Hobbes, he founded one of the major branches of Scottish thinking, and opposed Hobbes' disciple David Hume (1711-1776). Hutcheson's major contribution to world thought was the utilitarian and consequentialist principle that virtue is that which brought the greatest good to the most people.

Hume himself (who studied at the University of Edinburgh from the age of twelve) is arguably the most important thinker in the Scottish Enlightenment; his moral philosophy eventually triumphed over Hutcheson's, and his investigations into political economy inspired his friend Adam Smith (1723-1790) to more detailed work. Adam Smith was a Scottish political economist and moral philosopher. His Inquiry into the Nature and Causes of the Wealth of Nations was one of the earliest attempts to study the historical development of industry and commerce in Europe. That work helped to create the modern academic discipline of economics and provided one of the best-known intellectual rationales for free trade and capitalism. If Hume was primarily concerned with philosophy and worked less in economics, his ideas nevertheless led to important work in the latter field. Following Hume's impassioned defense of free trade, Adam Smith developed the concept and in 1776 published what is arguably the first work of modern economics - The Wealth of Nations. This famous study had an immediate impact on British economic policy, and it still informs 21st century discussions on globalization and tariffs. Adam Smith is now widely renowned as the father of modern economics and was a Professor at the University of Glasgow 300 years after its foundation in 1451.

The study of economics at universities in Scotland continues a distinguished record that dates back to this time. University departments now offer a modern environment in historical settings in which to study a variety of topics including microeconomics, financial economics, international macroeconomics and finance, industrial economics, econometrics and development economics.

The economy of Scotland is closely linked with that of the United Kingdom, and is essentially a capitalist economy with little government interference in private enterprise. After the Industrial Revolution, the Scottish economy concentrated on heavy industry, dominated by the ship building, coal mining and steel industries. Scottish participation in the British Empire also allowed the Scottish economy to export its output throughout the world. However heavy industry declined in the latter part of the 20th century leading to a remarkable shift in the economy of Scotland towards a technology and service sector based economy. The 1980s saw an economic boom in the Silicon Glen corridor between Glasgow and Edinburgh, with many large technology firms relocating to Scotland. This boom turned to bust and by the start of this century little of it was left. Current major industries include banking and financial services, education, entertainment, biotechnology, transport equipment, oil and gas, whisky, and tourism. Other important industries include textile production (woollens, worsteds, silks, and linens), distilling, brewing and fishing. The Gross Domestic Product (GDP) of Scotland is almost UKP £73 billion [1](US$129 billion), giving a per capita GDP of US$22,800.