The Intellectual Reaction

As trade and production became increasingly global, the ideas of early economists such as Adam Smith (see Topic 5.1) were taken in new directions. While Smith wrote in an age of individual entrepreneurs and small businesses, people of the 19th century witnessed the rise of large-scale transnational businesses. This shift caused people to think about society in new ways. For example, utopian socialists tried to create new communities to demonstrate alternatives to capitalism.

John Stuart Mill Some economists, clergy, and intellectuals criticized laissez-faire capitalism as inhumane to workers. One of these was a British philosopher, John Stuart Mill (1806–1873). He championed legal reforms to allow labor unions, limit child labor, and ensure safe working conditions in factories. While his ideas were controversial in his time, many of them eventually become widely adopted in industrial societies.

Mill’s philosophy was called utilitarianism. Rather than state a set of timeless moral rules, as many religions or ethicists did, utilitarianism sought “the greatest good for the greatest number of people.” Unlike utopian socialists, who wanted to replace capitalism, utilitarians wanted to address the growing problems they saw with it. They viewed themselves as moderate, rational advocates of gradual reform.