The Theory established Smith's excellent scholarly reputation. It was so overwhelming that Charles Townshend - who was later to become Chancellor of the Exchequer - offered him a generously endowed position as the tutor of his young stepson, the Duke of Buccleuch. Smith accepted and started touring Europe with his pupil. The journey lasted three years. In France, Smith encountered an intellectually inspiring group. He met Benjamin Franklin, who served as Ambassador to France and later became one of the Founding Fathers of the US. He had discussions with Voltaire, Turgot and Quesnay. More and more, he reflected on economic questions. When the European journey came to a premature end, Smith returned home to Kirkcaldy, where he spent ten years working out his new economic theory. When the Wealth of Nations finally came out in 1776, it was a revolution - and an immediate success, too. The first edition was sold out within six months.

The Wealth of Nations is no ideological pamphlet - quite the contrary. It is an analytical treatise on the logic of the market, taking individual actions as the starting point of observation and explanation. Smith explains the workings of incentives. He differentiates between individual morality and the deontological laws applicable to complex systems. He sheds light on the rise and use of the division of labour. He justifies free trade, arguing still in terms of absolute advantage, however, not "comparative advantage". It took several decades and David Ricardo to find that out. Smith also attempts to construct a theory of value - his one big failure. Based on the cost of labour, this approach later opened an avenue for Karl Marx.

Smith's major works both take the same methodological route, using parallel premises and leading to analogous results. Smith's approach is typical of the empiricism that was in vogue during the Scottish Enlightenment. He describes meticulously that which is - and not so much that which should be. He looks at people's behaviour and tries to deduce universal laws from what he sees. Since man is a social animal, the observations focus on human interaction.