History of Political Economy

Seeking the Roots of Adam Smith’s Division

of Labor in Medieval Persia
Hamid Hosseini

The enterpriser addressing a Greek who had been boasting of the

achievements of his people, says: “You boast most unreasonably of these
sciences; for you did not discover them by your own penetration, but
attained them from the scientific men among the Jews of Ptolemy’s times;
and some sciences you took from the Egyptians in the day of Pram-
metichus, and then introduced them into your own land, and now you
claim to have discovered them”; the King asked the Greek philosopher:
“Can it be as he says?’ He replied, saying, “It is true; we obtained most
of the sciences from the preceding philosophers, as others now receive
them from us. Such is the way of the world-for one people to derive
benefit from another.”
-Rasail of the Ikhwan Al-Safa

No historical student of Western Europe can ever reconstruct for himself

the intellectual values of the later Middle Ages unless he possesses a
vivid awareness of Islam looming in the background.
-Pierce Butler

Division of labor played a very significant role in Adam Smith’s semi-

nal work, the Wealth of Nations ([ 17761 1985; hereafter cited as W N ) .
In fact, Smith “placed the division of labor at the forefront of his dis-

Correspondence may be addressed to Professor Hamid Hosseini, Department of Economics,

King’s College, Wilkes-Barre PA 18711. I am grateful to two anonymous referees for many
useful comments and suggestions.
History of Political Economy 30:40 1998 by Duke University Press.

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654 History of Political Economy 30:4 (1998)

cussion of economic growth” (Groenewegen 1987, 901). However, in

none of its various forms did division of labor theory originate with
Adam Smith (see Schumpeter 1954, 187).
The concept of division of labor has been known since the time of
ancient Greece, particularly in the writings of Plato and Xenophon.
However, Plato’s and Xenophon’s discussions of this concept concern
“the separation of employment and professions within society at large
or social division of labor” (Groenewegen 1987,901). Division of labor
within the factory or a single industry, called manufacturing division of
labor (ibid.) or technical division of labor (Rubin [1929] 1979, 179),
came under investigation much later. Historians of economic thought
generally believe that the manufacturing (technical) division of labor,
which was central to Smith’s analysis of economic growth, had been
considered before the publication of WN and by William Petty and
other English writers during the seventeenth and eighteenth centuries.
The application of division of labor to the household, as well as to the
locational specialization of industries both nationally and internation-
ally, also emerged long after the basic concept first appeared in early
Greek writing. For example, according to Peter Groenewegen (1987,
904), Thomas Hodgskin ([ 18291 1966) was the first writer to apply divi-
sion of labor to the household.
It can (and will) be argued that medieval Muslim scholars in Persia,
who were the most productive of medieval Muslim intellectuals, dis-
cussed division of labor in some of its various forms.1 Obviously, writ-
ing before the industrial age, their understanding of the manufacturing
division of labor and its economic benefits was rudimentary. It is worth
exploring whether these medieval scholars could have (directly or
indirectly) influenced the discussions of division of labor of Smith and
other seventeenth- and eighteenth-century writers. It is a fact that var-
ious forms of division of labor were known by many pre-Smithian
seventeenth- and eighteenth-century English (and some French) writ-
ers. The question is, could Smith and these pre-Smithian writers have
been influenced by medieval Persian writers? Since medieval European
scholars (and even Smith) were not in the habit of providing citations
(particularly if it meant giving credit to Muslim scholars), this exami-
nation is not an easy one.
1. The core of the Persian empire was created some 2500 years ago by Cyrus the Great. In
1935 its name was officially changed from Persia to Iran by Reza Shah, who ruled from 1921
to 1941. The region has been known internally as Iran, however, for several centuries.

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Hosseini / Smith’s Division of Labor and Medieval Persia 655

Virtually no historians of economic thought make any mention of

any discussions by medieval Muslims on division of labor. For exam-
ple, Vernard Foley, who traces the roots of Smith’s division of labor to
Plato, fails to note the writings of medieval Persian (or Arab or Span-
ish) scholars who debated Platonic (and other Greek) themes including
his concept of division of labor (Foley, 1974). Paul McNulty, who fol-
lows Smith’s division of labor back to Encyclopidie and the writings of
Joseph Harris, John Locke, Sir Thomas Mun, and Bernard Mandeville,
also ignores the contributions of medieval Persian Muslims (McNulty,
1975). The same can be said of Groenewegen’s 1977 essay and his com-
prehensive survey of division of labor in the New Palgrave (1987).
According to Todd Lowry (1979,73), Smith’s substantive economic
analysis of division of labor appears with his illustration of the pro-
ductivity of the pin factory (which was also mentioned before Smith by
Joseph Harris). It is interesting that Abu Hamed Ghazali (in Latin,
Algazel; 1058- 111I), a medieval Persian theologian scholar, elabo-
rated the concept of division of labor using the example of a needle fac-
tory (instead of a pin factory).2 This could be an indication that Smith
and Harris (1757) were influenced by medieval Persian scholars in their
use of the pin factory example.
Ghazali was by no means the only medieval Persian scholar to con-
sider division of labor and its usefulness. Division of labor was exam-
ined by various medieval ethicists, theologians, philosophers, and the
writers of (Persian) “mirrors for princes.”3 These writers, who were
influenced by ancient Greeks long before medieval Western Europeans,
discussed, debated, elaborated, and critiqued the philosophical and sci-
entific themes of the Greeks and viewed them as their own. In fact,
even the Koran, particularly in its notions of the golden mean, moder-
ation, and ethics, appears very “Greek.” Among the “Greek” themes
medieval Persian scholars (as well as Arab and some Spanish Muslim
scholars) discussed was the notion of division of labor. However, the

2. I first became aware of Ghazali’s needle factory example during S. M. Ghazanfar’s 1994
History of Economic Society presentation.
3. After a series of political books (advice to Sassani Persian kings) were translated from
Middle Persian (Pahlavi) into Arabic during the eighth century, certain Muslims began a new
branch of literature called “mirrors for princes.” This literature, reflecting the influence of
Persian thought on Islamic civilization, is a generally wise account of society, politics, and
economy and demonstrates a great deal of realism and expediency. For centuries, Arab and
non-Arab Muslims (usually Persians) wrote mirrors in Arabic and Persian using anecdotes,
aphorisms, and proverbs (usually of Persian origin) to guide and advise rulers.

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656 History of Political Economy 30:4 (1998)

contributions of these Muslims in economic matters have been gener-

ally ignored by historians of economic thought.
This oversight is rooted in the Schumpeterian “Great Gap” thesis.
According to Joseph Schumpeter, economic analysis began with the
Greeks but dropped off and was not reestablished until the rise of Euro-
pean scholasticism in the hands of Thomas Aquinas (1225- 1274). The
Great Gap thesis has been deeply entrenched as part of accepted tradi-
tion in economics (in fact, it precedes Schumpeter and goes back to
nineteenth-century writers such as William Ashly) and is reflected in
almost all relevant literature in our discipline (see Ghazanfar 1991 and
Hosseini 1995, 1996). As a result of the Great Gap thesis, historians of
economic thought have ignored the contributions of medieval Muslim
(Persian, Arab, or Spanish) scholars to the history of economics. How-
ever, during the last several years, various writers, including Louis
Baeck, Yassine Essid, S. M. Ghazanfar, and Hamid Hosseini, inclined
to do justice to the contributions that have been neglected by historians
of economic thought, have begun to take issue with the Great Gap the-
sis. As these writers have demonstrated, medieval Islamic writers,
influenced by the Islamic ethos (including the protrade and promarket
views of the Koran and the Prophet Mohammad), the Persian thought
of the Sassani age, and the Hellenic thought of Islamized lands, made
various contributions to economic thought and analysis. These writers
have also argued that medieval Islamic writers influenced European
scholastic thought, including economic thought. It is very likely that
this influence also affected the understanding of division of labor. Since
the 1860s various scholarly works published in all major western lan-
guages have shown that all the medieval scholars mentioned in chap-
ter two of Schumpeter’sHistory of Economic Analysis (1954), namely,
Robert Grossetteste, Alexander of Hales, Albertus Magnus, Aquinas,
St. Bonaventura, Duns Scotus, Roger Bacon, Marsilius of Padua, Rich-
ard of Middleton, Nicholas Oresme, and Joannes Buridanus, were in
one way or another influenced by medieval Islamic scholars (a great
portion of them being Persian speaking). The list can be extended to
many writers not named in Schumpeter’s chapter two (see Mirakhor
1988,305).
This explicit discussion concerning division of labor is found in the
works of various Persian-speaking medieval Muslim writers including
Farabi (873-950), Kai Kavus (eleventh century), Ibn Miskaway (d.
1030), Ibn Sina (980- 1037), Ghazali, Nasir Tusi (1201- 1274), and

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Hosseini / Smith’s Division of Labor and Medieval Persia 657

Asaad Davani (b. 1444).4 Some of these writers produced hundreds of

books; thus, it would be extremely difficult to examine all of the works
of those or other Persian writers of the medieval period. Thus I will
only examine the works I will cite in section 4. After discussing the
contributions of Persians, I will investigate the ways in which medieval
Islamic thought was transmitted to Europe. It is in this transmission
that the neglect of Islamic (Persian, Arab, and so forth) contributions
can be properly understood.

1. Greek Thought in Medieval Iran

Western thought, it is argued, is based on the writings of ancient Greeks.
It is with this in mind that Theodor Gomperz wrote,
Even those who have no acquaintance with the doctrines and writ-
ings of the masters of antiquity, and who have not even heard the
names of Plato and Aristotle, are, nevertheless, under the spell of
their authority. It is not only that their influence is often transmitted
to us by their followers, ancient and modern: our mode of thinking,
the categories in which our ideas move, the forms of language in
which we express them, and which therefore govern our ideas- all
these are to no small extent the products of art, in large measure the
art of the great thinking of antiquity. (Quoted in Lowry 1979,65)
In linking modern western and Greek thought, proponents of western
culture assume that theirs are the only thought and culture that have
been enriched by the writings of ancient Greeks. On the contrary,
Islamized lands had access to Greek thought (including Plato’s concept
of division of labor) long before western Europeans did. In fact, it was
Islamic thought that helped the Aristotelianization of western thought
during the twelfth and thirteenth centuries. As Nicholas Rescher argues,
Islamic “philosophical writings exerted a significant stimulative influ-
ence on the great synthesis of Christian Aristotelianism by St. Albert
4. Both Iranians and various Turkik-speaking Muslims claim Farabi. Most biographers
agree that one of Farabi‘s parents was Persian speaking and the other spoke a Turkik lan-
guage. However, he lived in an area which was culturally Persian. Kai Kaus was born and
died in the Caspian region of Persia. Ibn Miskaway was from Ray (the birth place of Razi),
then an important city and educational center, but now a small town outside of Tehran. Ibn
Sina was born into a Persian-speaking family close to Bukhara (then a part of Persia) but lived
in the Persian cities of Isphahan and Hamadan (where he is buried). Asaad Davani was from
Davan, a village not far from Shiraz, Iran.

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the Great and St. Thomas Aquinas. This influence has not only been
extensive and profound, but relatively continuous and astonishingly
diversified” (quoted in Ghazanfar 1991, 124).
Islamized lands-namely certain Arab countries, Persia, or what is
called Turkey today-were not alien to Greek thought in pre-Islamic
times. Many Arab lands (which encompassed the territory of the modem
states of Syria, Palestine, Lebanon, and Egypt) and Asia Minor (which
occupied approximately the same territory as present-day Turkey) were
Hellenized, and the Persian Empire was occupied by Alexander the
Great and remained in the hands of the Greeks for decades. It is no won-
der that many important centers of Greek thought were situated in the
Middle East: Antioch in what is now western Turkey, Alexandna in
what is now Egypt, and Aleppo in modem Syria. The similarity of Aris-
totelian and Koranic concepts alluded to previously are not, therefore,
surprising. After all, the prophet Mohammad, as a merchant prior to 610
(when he claimed to have received revelation) made frequent visits to
Hellenized Arab lands (Palestine and Syria).
Islamic rationalism (independent of the Greek concept of philosophy)
began the Mutazilite school in Arab Iraq a century after the prophet
Mohammad’s death (632). The works of this school of thought culmi-
nated in the work of Abd al-Jabbar (935- 1025), a Persian who wrote
a long summa presenting the latest positions in dialectical form. Greek-
inspired philosophy, however, began to be studied by Muslims in the
ninth century, after Syrian Christian scholars at Baghdad had made
accurate Arabic translations of Aristotle and later Greek commentaries
on him. Soon Plato’s works, and the works of Greek scientists, were
also translated-including Galen’s medicine, Ptolemy’s astronomy and
geography, and Euclid’s geometry (see Hourani 1985,9). The first Mus-
lim philosopher (in the Greek tradition but with Islamic flavor) was
Kindi (d. 870), an Arab from Basra (in Iraq). After Kindi came the
greatest of Muslim philosophers- almost all Persian (and most of
them Shiite).
Like various Arab Muslim writers of that age, numerous medieval
Persian scholars, as Muslims and members of the Islamic society, also
studied philosophy by following the tradition started by Kindi. How-
ever, it was not just the ninth-century translation of the Greeks by Arab
Christians that introduced Persians to Greek thought. Persian scholars,
like pre-Islamic Hellenized scholars, were also familiar with Greek
thought. After all, before the emergence of Islam (and, later, the Otto-

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Hosseini / Smith’s Division of Labor and Medieval Persia 659

man Empire) Persia and Greece had been neighbors. In his writings on
King Cyrus, Xenophon, a contemporary of Plato and a disciple of
Socrates, tried to argue that Persian boys, under the leadership of
Cyrus, were educated in the light of Socratic ideas. According to Sir
Ernest Barker, these are also Plato’s ideas: “These are also the Platonic
conclusions; and indeed the Republic may be termed a Cyropadia with-
out the historical setting of Xenophon, a Cyropadia informed instead
by a deep philosophy of man and of the world” (Barker 1959,55).
It was this familiarity of pre-Islamic Persians with Greek (as well as
Indian) thought that caused Sassani Persian kings to establish the Jundi
Shapur University in the fourth century in the Persian province of Khu-
zistan. This university, which reached its height during the reign of
Anoshiravan the Just (531-579), was modeled after the Hellenized uni-
versities at Alexandria and Antioch. Jundi Shapur was first strength-
ened after 489, when the school of Edessa was closed by the order of
the Byzantine emperor, and its physicians took refuge in Jundi Shapur.
It latter attracted the best philosophers and scientists of Athens when,
in 529, Justinian ordered the school of Athens to be closed. When Per-
sians became Muslim in early Islamic history, Jundi Shapur University
was an important center synthesizing Persian, Greek (and Roman), and
Indian sciences. Jundi Shapur continued a few centuries after the Islam-
ization of Persia and was revived as a modem university in the twenti-
eth century.
The Islamization of Persia gave rise to an intellectual renaissance in
various fields of learning: Persian literature (poetry and prose), Arabic
language, philosophy, ethics, theology, medicine, mathematics, history,
and geography. The renaissance was particularly marked after the
learned vazier of two Persian Seljuq kings (namely, Nezam-al-Mulk,
the author of Siasat Nameh) established formal centers of learning
in various Persian cities and in Baghdad (see Sedigh 1960, 141).
Medieval Persia produced among the greatest minds of premodern
times in philosophy, science, medicine, mathematics, and literature. In
fact, the greatest of medieval Muslim scholars were Persian speaking
-that included Greek-inspired philosophy. Persian-speaking philoso-
phers who, following the Arab philosopher Kindi, wrote in the tradition
of the ancient Greeks included the following: Farabi, whose mother
was Turkik speaking from Persian-speaking Muslim lands; Ibn Sina
(or, in Latin, Avicenna), also a great physician; Razi (Latin Rhazes,
865-925), perhaps the first chemist (distinct from alchemy) in history;

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Khwarazmi (d. 850), the author of the first treatise in algebra; Ibn
Miskaway, the author of the first book on ethics in Muslim lands; Gha-
zali, also a great Islamic jurist (of Shafeite Sunni branch); Suhravardi
(d. 1191); Tusi, also the greatest medieval Islamic ethicist; Tusi’s stu-
dent Qutb-al-Deen Shirazi; Mulla Sadra Shirazi (d. 1640); and many
more (Nasr 1975).
Persians have been much more serious about Greek-inspired philos-
ophy than other Muslims, producing philosophy up to modern times
and integrating philosophy and theology (theosophy). The decline of
philosophy among Sunnis (thus Arabs) occured first as a result of Gha-
zali’s attack of Greek-inspired philosophy during the eleventh century,
and then of the fall of Baghdad (as the center of Arab and Sunni philo-
sophy) in 1258 during the Mongol invasion. However, Persian-spealung
Shiites, building on the works of other Persians-Farabi, Ibn Sina,
Suhravardi, and others -continued their philosophical discourse up to
modern times. These Persians, beginning with Tusi and his student
Qutb-al-Deen Shirazi, revived the Islamic philosophy of Ibn Sina and
others, as well as the study of mathematics and astronomy. These phil-
osophical studies became synthesized in vast metaphysical systems
which reached their peak during the seventeenth century with Mir
Damad and, particularly, Mulla Sadra Shirazi. These metaphysicians,
who were the contemporaries of Descartes and Leibniz, developed a
metaphysics which was no less logical or demonstrative than those of
their European contemporaries (see Hosseini 1996).
The works of all these philosophers are in the tradition of what
Greeks called philosophy. Some authors have maintained that some-
times these philosophers paid only lip service to Islam by advocating
the harmony of reason and revelation, but in reality they disguised
their fidelity to Greek philosophy, which stressed naturalism, in order
to escape compulsion and censorship (Khadduri 1984,108). It was due
to the impact of Greek philosophy, especially the writing of Plato and
Aristotle, that Muslim (particularly Persian) philosophers, beginning
with Farabi, were perhaps the earliest Muslim thinkers to state clearly
that the ultimate purpose of life is happiness. These Iranian philoso-
phers, in their revival of Greek philosophy, also rekindled Plato’s dis-
cussions of division of labor. This is particularly true in the case of
those medieval Persian philosophers (as well as theologians and essay-
ists) who dealt with economic issues.

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Hosseini / Smith’s Division of Labor and Medieval Persia 661

2. Wealth, Economic Activity, and the Market

Mechanism in the Writings of Plato,
Aristotle, and Medieval Persian Scholars
Paul McNulty (1975, 375) emphasizes that division of labor in the
Smithian system is “the necessary, though very slow and gradual, con-
sequence of a certain propensity in human nature, which has in view no
such extensive utility; the propensity to truck, barter and exchange one
thing for another.” Smith, who believed that it is the “trucking disposi-
tion which originally gives occasion” to division of labor (WN, 15), fur-
ther emphasizes the importance of surplus product exchange to division
of labor when he states that “the certainty of being able to exchange all
that surplus part of the produce of his own labor, which is over and
above his own consumption, for such parts of the produce of other men’s
labor as he may have occasion for, encourages every man to apply him-
self to a particular occupation, and to cultivate and bring to perfection
whatever talent or genius he may possess for that particular species of
business” (ibid.).
If this is Smith’s view of division of labor, he was a great deal closer
to the views of medieval Islamic philosophers than to those of Plato and
Aristotle. This could be because the medieval Persian (and Arab and
Spanish) society under Islamic rule was much closer to Smith’s society,
at least in terms of the views on exchange. As Todd Lowry has reminded
us, Oikonomia was not a concept of a self-regulating market; its orien-
tation was administrative (Lowry 1979, 80).
In Plato, we see a derogation of economic activity reinforced by his
description of the ideal property arrangements for each class. For him,
only the lowest classes-farmers and artisans-were allowed to work
for profit and accumulate property; the pursuit of money by the base
would not arouse the envy of wise rulers any more than the prudent
exercise of power by the latter would antagonize artisans and farmers.
For Plato, the desire to engage in exchange is not a universal human
characteristic. Rather, it is a specialized activity “undertaken by those
less fit for productive activity” (McNulty 1975, 375). This view is evi-
dent in Plato’s Republic, in the discussion between Socrates and
Adeimantus (Plato 1941, 63). In the Republic, we have a socially and
economically stratified society where labor immobility exists within
the artisan and handicraft economy. It should not be surprising to learn

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“that division of labor concerns him [Plato], not as the best method of
economic production, but as a means to the welfare of the soul”
(Barker 1959, 85). Plato rejected private property (for upper classes, at
least), because it causes selfishness (390).
In contrast to Plato, Aristotle defended private property. He viewed
it as a natural right, because it is a necessary factor in good life. Aris-
totle found that it is human nature and not private property which
causes selfishness. Of course, Aristotle’s definition of property is inter-
esting both for what it includes as well as for what it excludes. For
example, it excludes intangible assets such as money and securities, but
includes slaves and tangible objects (Aristotle 1921, 56). Although
Aristotle defended private property, he rejected exchange and had no
Platonic appreciation for division of labor; he also did not provide a
market analysis of acquisition. As Thomas Lewis argues, “Aristotle’s
non-market analysis stemmed from a reasoned rejection of the market
mechanism as a way of meeting the problem of livelihood” (Lewis
1978, 178).
More recently, however, economists have come to understand that
Aristotle’s rejection of exchange in book 1 of the Politics is not his only
treatment of exchange. He also discussed exchange in book 5 of the
Nicomachean Ethics. Lewis reminds us that
There is a basic difference between the types of exchange described
in Book I of the Politics and in Book 5 of the Nicomachean Ethics.
Unlike the interhousehold exchange of the Politics, the exchange
process of the Ethics is not directly relevant to the transition from
household to Polis life. Although this type of Aristotelian exchange
is a natural form of exchange, it is nonetheless an inferior form, and
an appreciation of the nature of this inferiority reveals a second
aspect of Aristotle’s case against the market. (83)
For Aristotle, “The craftsmen are not equal to the household head, who
has the capabilities for citizenship.” The craftsman’s humanity, that is,
his human capability, lies somewhere between those of the citizen and
the slave. The slave is presumed to be so deficient in his ability to direct
himself that it is appropriate for him to be a part of the household,
whereas the craftsman requires much less close supervision (ibid).
Medieval Islamic (Persian, Arab, or Spanish) scholars’ views on eco-
nomic activity were much closer to Adam Smith’s than those of Plato
and Aristotle. This similarity had to do with Islam’s mercantile roots,

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Hosseini / Smith’s Division of Labor and Medieval Persia 663

the protrade views of the Koran (believed to be direct words of God)

and the Hadith (reported words and acts of the prophet Mohammad),
the positive view of wealth and activity in Arab and Persian societies on
the eve of the rise of Islam, and the fact that medieval Persian and Arab
scholars were equipped with the rationalism they inherited from the
Greeks (Hosseini 1995). The Koran and the Hadith are both anti-ascetic
and advocate moderation in wordly affairs (see Hosseini 1988). Moham-
mad engaged in commercial activity up to the age of forty and lived in
a society that emphasized mercantile activity. Production and trade
are pictured in the Koran and the Hadith as noble practices, and mer-
chants are favorably portrayed (Essid 1988, 78); these texts contain
many passages which encourage trade. Sami Zubaida (1972) reminds
readers that “the Meccan milieu of Mohammad and his followers was
a business milieu. Before the call to Islam, Mohammad and his com-
panion engaged in trade extensively. Mohammad was a relatively small
merchant, but also acted as agent for other merchants in trade with
Syria. The early Muslims of Mecca and Medina continued in trade”
(321). For several centuries the statuses of trade and the merchant were
raised further as Islamic society became more prosperous (see Hosseini
1996). And they continued to rise for several centuries after Moham-
mad, as Islamic society, which soon embraced Persian and Hellenic
lands, became more complex.
The complexity of medieval Islamic society is discussed in the works
of various writers including Subhi Labib, Elias Tuma, A. Udovitch, and
S. G. Goitein. For example, Goitein speaks of the rise of Islamic bour-
geoisie during the first six centuries of Islamic history: “A subject wor-
thy of such special study is the merchants’ class and bourgeoisie of
early Islam. This class developed slowly during the first hundred and
fifty years of the Muslim era, emerged into the full light of history at
the end of the second, became socially admitted during the third and
asserted itself as a most powerful socio-economic factor during the
fourth” (Goitein 1957, 584-85).
This bourgeoisie was not able to obtain political power, nor was it
able to enjoy other powers necessary for the type of bourgeoisie which
developed in Western Europe in modem times. In the words of Goitein,
it never became an organized body and, as a class, never obtained
political power, although many of its members occupied positions as
high and highest executives of the state. The turn from the tenth to

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664 History of Political Economy 30:4 (1998)

the eleventh century (the Muslim fourth and fifth), which witnessed
the apogee of the Near-Eastern bourgeoisie, also marks the complete
ascendency of castes of slave soldiers, mostly of Turkish extraction,
which dominated the history of that part of the world for the next
eight hundred years. At the same time, the monetary and mercantile
economy of the Near-East gave way to an economy in which feudal-
istic trends became dominant. (584)
Nevertheless, Goitein reminds us of the substantial influence of the
Islamic bourgeoisie: “Before all this happened, however, Islam as a
religion and civilization, had fully taken shape, and it was largely mem-
bers of the bourgeiosie, who had developed Muslim religious law, which
is the backbone and very essence of Islam” (ibid.). The Persian writers
considered in this article are no exceptions; they, too, reflect the senti-
ments and views of the early Islamic bourgeoisie.
The complexity, diversity, and relative sophistication of medieval
Islamic lands- that included Spain, North Africa, Western, Central,
and Southern Asia-generated debates and practical opinions con-
cerning political, economic, social, religious, and day-to-day issues.
The availability of Greek (philosophical and scientific) and Persian
(mostly political theoretic) texts in Islamized lands and their transla-
tions to Arabic (the international language of medieval Muslims for sci-
entific, philosophical, and religious discourse) made these debates
more sophisticated and lively. These debates generated great works in
philosophy, theology, ethics, geography, history, the sciences, and med-
icine, and practical manuals to guide leaders and merchants. In partic-
ular, medieval Persian writers demonstrated a thorough understanding
of the economic process and made substantial contributions to popular
understanding of the economic problems of their age. Of course,
because economics was not yet an independent discipline, their eco-
nomic discussions were usually mixed with ethical, theological, and
philosophical arguments. There also existed a few pamphlets devoted
to the discussion of economic issues (see Hosseini 1995, 1996, and the
works of Essid, Ghazanfar, and Baeck).
In contrast to Plato, medieval Persian scholars were not troubled by
the accumulation of wealth, as long as it was within the framework of
Islamic ethics. Their views of wealth were not different from those
expressed by Adam Smith. As indicated by the eleventh-century Per-
sian writer Kavus, “do not be indifferent to the acquisition of wealth.

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Hosseini / Smith’s Division of Labor and Medieval Persia 665

Assure yourself that everything you acquire shall be the best quality
and is likely to give you pleasure” (1951, 91). According to Tusi, “the
intelligent man should not neglect to store up provisions and property”
(1964, 159). Ghazali wrote, “people love to accumulate wealth and pos-
sessions of all kinds of property. If he has two valleys of gold, he wants
to have a third” (quoted in Ghazanfar and Islahi 1990, 384). The posi-
tive view of wealth accumulation in the writings of medieval Persian
scholars is also evident in their writings on poverty. For example,
Kavus tells his son, “You must have an affection for the rich, without
regard to their personal concern, and that they dislike poor men, even
when their interests are at stake. The reason is that poverty is man’s
worst evil and any quality which is to the credit of the wealthy is a
derogation of the poor” (1951,92).

3. Are Plato’s and Adam Smith’s Concepts

of Division of Labor Really Similar?
In his 1974 HOPE article, Vernard Foley tried to argue that division of
labor in Plato and Smith are similar because “both men treat the ori-
gin of the division of labor in connection with the fourth stage, the
establishment of human settlements” (225). Foley reminds us that
“Plato’s best-known treatment of division of labor occurs in the Repub-
lic, where he discusses the development of economic specialization as
it is assumed to occur after the founding of a hypothetical city” (ibid.).
We all know that this hypothetical city is his communistic society in
which the government regulates trade and industry and assigns to all
members of each economic class their special work, in order that, each
person practicing his or her own craft, and no person interfering with
another’s craft, there may be no dissensions (Barker 1959, 140). This
does not seem to be too similar to Smith’s vision of a society where
laissez-faire and freedom of enterprise and trade prevail.
Plato’s theory of division of labor was based on the concept of nat-
ural talents or skills (Lowry 1979, 73). To him, not everyone is fit to
engage in every economic activity. In the Republic, Socrates instructs
Adeimantus that “we are not all alike; there are diversities of nature
among us which are adapted to different occupations” (Plato 1941,61).
In contrast to Smith, the Platonic view of natural talents leads to social
stratification and labor immobility within an artisan and handicraft
economy. In the Republic, Socrates reminds Adeimantus that “the

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shoemaker was not allowed by us to be a husbandman, or weave6 or a

builder-in order that we might have our shoes well made; but to him
and to every other worker was assigned one work for which he was by
natureJitted and at that he was to continue working all his life long and
at no other” (67; emphases added). In Plato’s ideal city, the laboring
class has little respect, since, to him, “mean employment and manual
arts involve disgrace” (590). In contrast, Plato’s views of philosophers
are quite different. Philosophers, as a class, are designated by Plato for
rule because of their “inborn disposition” for knowledge and wisdom.
Smith’s concept of division of labor, as we saw earlier, has strong
links to his concept of exchange. For him, division of labor is the con-
sequence of the propensity to truck, barter, and exchange (WN, 13). By
contrast, in Plato’s system, the link between division of labor and the
exchange process is rather weak. For Plato, the desire to exchange is
not a universal human characteristic, “it is a rather specialized activity
undertaken by those less fit for productive activity” (McNulty 1975,
375). Speaking of those who engage in trade, Plato writes, “In well
ordered states they are commonly those who are the weakest in bod-
ily strength, and therefore of little use for any other purpose; their duty
is to be in the market” (1941,63).
Smith’s most extensive analysis of the impact of division of labor is
found in his discussion of his famous pin-making factory. In this exam-
ple, improvements in the productive powers of labor and in the distri-
bution of goods among people are attributed to the division of labor.
Smith starts from different logical assumptions than does Plato. In that
example, Smith treats labor as a homogeneous factor of production. In
other words, there is no comparative advantage in terms of natural tal-
ents possessed by workers engaged in different tasks of the needed
activity. The increased production, which the division of labor makes
possible, is the result of the organization of work within the enterprise
(cooperation).Plato’s division of labor, as we saw earlier, was, in essence,
social division of labor. Thus, Smith’s concept of manufacturing divi-
sion of labor could not have been influenced by Plato. It is well known
that prior to Smith, during the seventeenth and eighteenth centuries,
many English and some French writers discussed manufacturing divi-
sion of labor (see Groenewegen 1977 and 1987). For example, William
Petty’s Political Arithmetick (published in 1671) discussed the benefits
of division of labor in the textile industry and shipbuilding. Later on he
applied division of labor to watchmaking. During the eighteenth cen-

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Hosseini / Smith’s Division of Labor and Medieval Persia 667

tury, Patrick Lindsay, Richard Campbell, and Harris concentrated on man-

ufacturing division of labor, while Mandeville, Francis Hutcheson, and
Josiah Tucker wrote about social division of labor. Various eighteenth-
century French writers also discussed division of labor, including man-
ufacturing division of labor (see Groenewegen 1987,902).

4. Division of Labor in the Writings

of Medieval Persian Scholars
As stated previously, medieval Persian philosophers, theologians, ethi-
cists, scientists, and writers of “mirrors for princes” were familiar with
Greek thought. Medieval Persian philosophers, who viewed themselves
as the intellectual descendants of Greek philosophers, and ethicists,
who did not see a contradiction between their Islamic faith and Greek
rationalism, debated the philosophical themes discussed by the Greeks.
Division of labor was among these “Greek” issues.
Among the medieval Muslim scholars of the Persian world who dis-
cussed division of labor are the following: the philosopher Farabi; the
ethicist Ibn Miskaway ; the philosopher, physician, and scientist Ibn
Sina; the theologian Ghazali; the prince-mirror writer Kavus; the
philosopher-ethicist Tusi; and the ethicist Davani. Each of these writ-
ers wrote numerous (sometimes hundreds) books. However, we will
only consider the following works written by these scholars: Farabi’s
Good City, Ibn Miskaway’s Tahdhib-al-Akhlaq,Ibn Sina’s Tadbir Man-
zel (household management), Kavus’s Qabus Nameh, Ghazali’s Ihya,
Tusi’s Nasirean Ethics, and Davani’s Akhlaq-e-Jalali.
Medieval Persian scholars discussed various types of division of
labor. All the above-mentioned writers viewed human beings as social
beings and social division of labor as something necessary. Belief in the
necessity of social division of labor is evident in Tusi’s discussion of
civilization: “The term is derived from Madina which means the assem-
blage of persons who cooperate with one another by adopting various
crafts in industries in order to provide the comforts of life. This is
exactly the meaning of the statement that humans by their very nature
are social” (Tusi 1985, 252; my translation).s Farabi also discussed
social division of labor: “Human being is a creature who, in obtaining
hisher means of sustenance and in building his character, requires the

5. For this and subsequent translations I consulted Ghazanfar 1994 and Tusi 1964.

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achievement of certain tasks that he/she cannot achieve alone. These

tasks must be done by a group which he/she is only a part of’ (Farabi
1982,251).
Tusi views social division of labor as a necessary cooperation among
individuals: “The purpose of this detailed exposition is to show that the
human species, which is the noblest of existent beings in the universe,
needs both the aid of the species and the cooperation of its own kind to
ensure the survival of the individual as well as that of the race” (Tusi
1985,252). He also stated, “Thus, every craftsman [producer] concen-
trates on his craft because he has specialized in it according to social
requirements” (ibid).
According to Groenewegen, Hodgskin ([1829] 1966) was the first
writer to apply division of labor to the household. Yet, Persian writers
Ibn Sina and Tusi discussed division of labor as applied to the house-
hold long before Hodgskin. In fact, much of Ibn Sina’s book, Tadbir
Manzel (household management), and the second discourse in Tusi’s
Nasirean Ethics are devoted to the application of division of labor to
the household. They both place division of labor at the forefront of
their discussions of the economics of the household. According to Ibn
Sina, “to protect what he has accumulated, man needs a partner. The
partner he chooses must be trustworthy and reliable. Only a wife is
worthy of this partnership, since God has granted her these qualities.
Thus, man is obligated to marry” (Ibn Sina 1940, 10; my translation). A
few pages later he writes, “As far as the means of sustenance are con-
cerned, kings and subjects, masters and servants are alike. Man needs
a house to protect, from burglers, what he has accumulated and a place
as shelter and to rest. He also needs a wife to protect his assets and the
house. Man also needs children to help him in times of need, to attend
to his chores when he is old, and to protect and revive his good name
after he dies. He is also in need of the assistance of servants; they will
lessen his burdens” (14).
Regarding different roles within the households, Ibn Sina writes,
After organizing the household and assembling all those individuals,
man takes charge of the family and of the other members of the
household who are under his guidance and management. In other
words, man, who has taken a wife and has children, other depen-
dents, and servants, should lead the household he has established. As
the head of the household, he has certain responsibilities that he is

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obligated to fulfill. These include protecting different members of

the family, providing their means of livelihood, improving various
aspects of their lives, and building their characters. He is also obli-
gated to encourage them to be decent and to do good, to deter and
discourage them from doing evil, and to guide them toward the
attainment of a more fulfilling life.” (16)
Tusi also discusses the application of division of labor to the house-
hold, its efficiency, and the fact of its necessity:
Whereas mankind needs food for the preservation of the individ-
ual, and the food needed for human species cannot be produced
without adhering to the economic tasks of sowing, harvesting, clean-
ing, pounding, kneading, and cooking; and the arrangement of such
processes cannot conceivably be effected without the collaboration
of helpers and the application of tools and utensils; . . . and since
restriction to the amount of their day-by-day need would inevitably
bring about the exhaustion of supplies and a dislocation of their
mode of life, it being impossible to contrive in one day the quantity
of food which forms a daily ration . . . the need has arisen to store
the necessaries of life and to keep them safe from the rest of one’s
fellows, who are partners in necessity; but safeguarding cannot be
effected without a location in which food and sustenance will not
spoil, and which . . . at the times of sleep and waking, by day and
night-will restrain there from the hand of both the unjust and the
predator. . . . Thus the necessity has arisen for the building of houses.
Since, however, men must occupy themselves with a profession that
will encompass the acquisition of food, it becomes necessary to safe-
keep that amount which is already stored away. Accordingly there
has been a need for helpers who would reside in the houses as
deputies. . . . This necessity is in accordance with the preservation of
the individual. . . . But, in accordance with the preservation of the
species, there is also need for a mate on whose existence procreation
and generation are dependent. Accordingly, Divine Wisdom has
required that every man should take a mate, one who will both attend
to the custody of the house and its contents, and also by means of
whom the work of procreation is fulfilled. . . . Now, once the gener-
ation is accomplished, the upbringing by father and mother becomes
necessary . . . but as soon as the company-man, wife, and children
-is assembled, their sustenance and the fulfillment of their wants

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may be hard for one person. Thus, the need for auxiliaries and ser-
vants becomes obvious. . . . Now, since the organization of any group
[plurality?] may be affected by the manner in which it has been
structured [combined], demanding a kind of unity, there is, in this
organization of the household, the need for devising a method of
assigning responsibilities to each member in order to bring about
such a combination. Of all the members of the household, the master
of the household was most fitted to give attention to this task. Accord-
ingly, the management of the group was settled upon him. . . . Just as
the shepherd grazes a flock in a proper manner, taking them to suit-
able pastures and watering places, protecting them from harm by
wild beasts and from celestial and terrestial calamities . . . so, like-
wise, the manager of the household attends to what is appropriate in
respect to foodstuffs and provisions, arranging the affairs of daily
life and managing the circumstances of the community by encour-
agement and intimidation,promises, prevention and imposition, cour-
tesy and criticism, and kindness and severity so that each may reach
the perfection towards which he is directed.” (Tusi 1985,205-6; my
translation)
The writings of medieval Persian scholars also reflect their under-
standing of the necessity and usefulness of the international or inter-
regional division of labor. According to Farabi, different societies are
imperfect because each is endowed only with certain resources or
goods. A perfect society can only be achieved when domestic, regional,
and international trade takes place (Farabi 1982, 25). The benefits of
international and inter-regional division of labor are also appreciated
by Kavus. This prince from the very green Caspian region of Persia,
aware of the existence of very different climates within the (now) Iran-
ian plateau (and the Islamic world), understood that international and
inter-regional trade can be very valuable. Praising the role of interna-
tional merchants, he wrote, “To benefit the inhabitants of the west they
import the wealth of the east and for those of the east the wealth of the
west, and by doing so became the instruments of world’s civilization”
(Kavus 1951, 156; emphasis added).
The necessity and usefulness of the international division of labor
and trade is also understood by Ghazali. In Ihya he wrote:
Then, such practices extend to various countries. People travel to dif-
ferent places to obtain tools and food and transport them. People’s

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economic affairs become organized into cities which may not have
all the tools needed and into villages which may not have all the
food-stuffs needed. People’s needs and interests necessitate trans-
portation. Then, a class of traders who carry goods from one place to
another emerges. The motive behind all these activities is the accu-
mulation of profit, undoubtedly. These traders exhaust themselves by
travelling to satisfy other’s needs and to make profits, and then these
profits too are eaten by others when they themselves obtain things
from others. (Ghazanfar and Islahi 1990, 387)
Medieval Persian scholars sought maximization of economic activ-
ity, including in its productive form. In the words of Tusi, “all who are
engaged in a profession [trade or craft?] should seek perfection and
maximization therein, not showing contentment with an inferior degree
of acquiescing in meanness of aspiration. It should be recognized that
men have no finer ornament than an abundance of the means of suste-
nance, and the best means of acquiring that abundance lies in engag-
ing in a craft” (Tusi 1985, 212; my translation). It is in this light that
medieval Persian scholars sought division of labor, including, in a way,
its manufacturing variety.
Writing before the rise of the modern industrial age, particularly
prior to the rise of the factory, these writers could not have understood
manufacturing division of labor in exactly the manner of Adam Smith.
However, given the limitations of their age, their understanding of divi-
sion of labor “within the limits of a single industry,” was rather sophis-
ticated. In fact, they had a rudimentary understanding of manufacturing
division of labor. They understood the various tasks involved in pro-
ductive activity and, at least implicitly, hinted at the assignment of
these various tasks to different individuals.
Asaad Davani recognizes these various tasks when he argues that
“philosophers have a saying, that there are a thousand things to be
done before anyone can put a morsel of bread in his mouth” (1946,
320). Ghazali, however, recognizes that each task is assigned to a dif-
ferent worker. In the Ihya he wrote, “If one inquires, one will find that
perhaps a single loaf of bread takes its final shape with the help of per-
haps more than one thousand workers” (Ghazanfar and Islahi 1990,
390). Ghazali explained the complex process as follows: “You should
know that the plants and animals cannot be eaten and digested as they
are. Each needs some transformation, cleaning, mixing, and coolung,

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before consumption. For a bread, for example, first the farmer prepares
and cultivates the land, then the bullock and tools are needed to plough
the land. Then the crop is harvested and grains are cleaned and sepa-
rated. Then there is the milling into flour before baking. Just imagine
how many tasks are involved; and we here mentioned only some. And,
imagine the number of people performing these various tasks” (ibid.).
Ghazali’s argument reminds one of Smith’s statement that “the woolen
coat, for example, which covers the day-laborers, as coarse and rough
as it may appear, is the joint labor of a great multitude of workmen. The
shepherd, the sorter of the wool, the wool comber or carder, the dyer,
the scibbler, the spinner, the weaver, the fuller, the dresser, with many
others” (WN, 13).
For Ghazali, as for Smith centuries later, exchange and division of
labor are interrelated. In Ihya Ghazali wrote:
Perhaps farmers live where farming tools are not available. Black-
smiths and carpenters live where farming is lacking. So, the farmer
needs blacksmiths and carpenters, and they in turn need farmers.
Naturally, each will want to satisfy his needs by giving up in
exchange a portion of what he possesses. But, it is also possible that
when the carpenter wants food in exchange for tools, the farmer does
not need the tools. Or, when the farmer needs tools, the carpenter
does not need food. Therefore, pressures emerge leading to creating
of trading places where various tools can be kept for exchange and
also warehouses where the farmer’s produce can be stored. (Ghaz-
anfar and Islahi 1990, 390).
There are other similarities between Smith and medieval Persian
writers. For example, both Smith (WN, 15) and Tusi (1985,253) empha-
sized that exchange (and thus divison of labor) is a necessary conse-
quence of the faculties of reason and speech. Both of these writers
charge that animals such as dogs do not exchange one bone for another.
As Todd Lowry (1979,73) argues, Smith’s substantiveeconomic anal-
ysis of division of labor appears with his celebrated illustration of the
productivity of the pin factory. Interestingly enough, this example is
very similar to the medieval Persian theologian Ghazali’s discussion in
the Ihya of the division of labor in a needle factory. Speaking of the
efficiency of cooperation and division of labor, Ghazali states, “Even
the small needle becomes useful only after passing through the hand of
needle makers about twenty-five times, each time going through a dif-

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ferent process” (Ghazanfar and Islahi 1990,390). In addition to Smith,

Petty and some eighteenth-century French writers also had discussed
the pin factory as an example of manufacturing division of labor. Refer-
ring to Diderot’s Encyclopkdie, Groenewegen observes, “In its article
on pins (Epingle) their manufacturing is described as generally subdi-
vided into eighteen separate operations and therefore a prime example
of the manufacturing division of labor” (1987,902). It is interesting that
his example, like Ghazali’s, also mentions the number of operations it
takes to produce the needle (or pin).
Given the above-mentioned similarities between Smith and medieval
Persian scholars, and the fact that division of labor was at the forefront
of the economic analyses of both Smith and those medieval scholars,
could it be that Petty, and through him Smith, were influenced by Gha-
zali, Farabi, Ibn Sina, and Tusi? After all, many of the works of these
writers (who influenced Christian scholasticism) were available in Latin.
Of course, because Smith and other European writers before him were
not in the habit of providing citations (particularly when it came to
Muslim sources), direct proof of a link and influence is close to impos-
sible. But, is the assumption of a link and influence too far-fetched?
According to Groenewegen, “toward the end of the seventeenth cen-
tury, English economic literature rediscovered the concept of division
of labor and began to analyze the more modern manufacturing forms”
(1987, 901). This rediscovery also coincides with the time that British
merchants imported from the Near East a great deal of observation and
data about economic activity. Could the knowledge of the significance
of division of labor have been one such observation? Or, could there
have been other avenues of influence? Section 5 will explore other such
possible avenues of influence.

5. Transmission of Islamic Thought

to the Scholastics
Western Europeans became interested in science and philosophy during
the eleventh and twelfth centuries, when these branches of knowledge
were at their zenith in Persia, and some other parts of the Muslim
world. As W. M. Watt has reminded us, Western Europeans had to learn
all they could from the Muslims before they could make further
advances in these and other fields (Watt 1972,43). The transmission
mechanism (from Muslims to Europeans) will be discussed below. But,

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in many cases, Islamic thought did not have to travel very far, for many
Muslim thinkers were Spanish Muslims, among them Ibn Hazn of Car-
doba (d. 1064), Ibn Masarra (d. 931), Ibn Bajja (d. 1138), Ibn Tufayl (d.
1185), and Ibn Rushd (in Latin Averroes, 1126- 1198).
Historians of science and philosophy have recorded the transmission
mechanism of these disciplines from Persia and other Muslim lands to
the west (see Mirakhor 1988, 324). This mechanism took different
forms (see Mirakhor 1988, Ghazanfar 1991, and Hosseini 1995, 1996).
First, as Will Durant has noted, during the late eleventh and early
twelfth centuries, various western scholars, including Constantine the
African and Adelard of Bath, traveled to Muslim lands, learned Ara-
bic (the language of the Quran, Islamic theology, philosophy, and sci-
ence during that time), studied in Muslim institutions, and brought the
newly acquired knowledge back to Europe (Durant 1950, 979). An
example cited by both Watt and A. C. Crombie is Leonard0 Fibonacci
of Pisa (who died after 1240), who studied the mathematics of Persian
Muslim Khawrazmi and, upon his return in 1202, wrote his book Liber
Abaci (Watt 1972, 63; Crombie 1963, 1:61). It is interesting that in
Harro Bernardelli’s opinion European economic analysis begins with
Liber Abaci (see Mirakhor 1988,324-25).
M. M. Sharif discusses a second mechanism of transmission. Accord-
ing to him, many European students later attended Muslim schools in
order to study mathematics, philosophy, medicine, cosmography, and
other subjects. These students in due course became candidates for pro-
fessorships in the first western universities which were patterned after
the Muslim Mudressehs (schools). The new European universities,
which included the universities of Naples, Padua, Salerno, Toulouse,
Salamanca, Oxford, and Paris, were similar to Islamic schools in terms
of their style of architecture, curricula, and method of instruction
(Sharif 1966, 1368). It is known that during this period (the late twelfth
century) students brought back many manuscripts of Muslim writers to
Northern Europe. Durant mentions “a precious multitude of books”
that Daniel H. Morely brought back to England from Spain. During
this time, “Europe discovered the wealth of Spain in books. Scholars
descended upon Toledo, Cordova, and Seville; and a flood of new learn-
ing poured up over the Pyrenees to revolutionize the intellectual life of
the adolescent North” (Durant 1950, 909).
The third mechanism was the great translation movement by which

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most of the works of Muslim scholars (including Persians) were trans-

lated into Latin during the late twelfth and all through the thirteenth
and fourteenth centuries (Mirakhor 1988, 326). Translations mostly
took place in Spain (Toledo and Durgos), Italy (Sicily and Naples),
and, to some extent, France. (The French were primarily translating
into Latin Islamic works which had previously been translated into
Hebrew.) Translators were Christian and Jewish since, during that age,
many Europeans were familiar with Arabic. (An example was Roger
Bacon.) Among the works that they translated were those of Farabi,
Ibn Sina, Ghazali, Razi, and Khwarazmi. The influence of Muslims
(Persian, Arab, Spanish) on Western Europe during this age was sub-
stantial. As Gordon Leff has noted, “Intellectually, the difference
between the twelfth and thirteenth century was, at its broadest, the dif-
ference between isolation from the Islamic world and contact with it”
(Leff 1958, 141).
It is well documented that Muslim scholars of the medieval period
(including Persian Muslims) influenced the thoughts of scholastics like
Albertus Magnus, St. Bonaventura, Thomas Aquinas, Robert Grosseteste,
Alexander of Hales, Roger Bacon, William of Auvergn, Siger of Gradant,
John Peckham, Henry of Gent, Nicholas Oregme, and many more. Many
writers have shown, for example, that the influence of medieval Muslim
scholars on Europe affected the development of physics, chemistry,
astronomy, and cosmography (see, for example, Nasr 1970).
The opportunity for the views of medieval Persian and other Muslim
scholars to influence Christian scholasticism was even greater in eco-
nomics. In the words of Abbas Mirakhor, “If the ideas of Muslim schol-
ars in philosophy and science reached the scholastics through the trans-
lation of their works, the economic ideas had two other channels of
entry into the medieval way of life. One such channel was trade and
the other was the cultural diffusion of Muslim economic institutions
and processes into European medieval societies” (Mirakhor 1988,329).
It is documented that “everywhere Islam entered it activated busi-
ness life, fostered an increasing exchange of goods, and played an
important part in the development of credit” (Bertold Spuler, quoted by
Mirakhor 1988, 329). Muslim merchants became indispensable mid-
dlemen of western trade through Spain, the Mediterranean, and the
Baltic. According to Spuler, trade was carried on between the Islamic
east (particularly Persia) and Russia, Poland, the shore of the Baltic

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Sea, Scandinavia, northcentral Europe, England, and even Iceland.

Along with trade came the cultural diffusion of economic institutions
and processes. Udovitch (1967,260-65) has demonstrated that many
superior and flexible commercial techniques that were developed in
Persia, other parts of Muslim East, and Muslim Spain (including vari-
ous forms of commenda contracts, instruments of credit, bills of
exchange, and letters of credit-Sufa, Hawala, and so on) soon spread
to Latin Europe. Labib (1969, 85) has even found a rare fifteenth-
century commenda contract between a Venetian and a Muslim mer-
chant in Alexandria (see also Mirakhor 1988, 329). Other institutions
such as funduq (an early form of stock exchange), Mauna (or mana,
private bank), and Hisba (a market regulatory agency) which existed in
Muslim Spain also found their way to Latin Europe.
It is then possible that opportunities existed for the European
scholastics to be influenced in various ways by Persian and other Mus-
lim scholars of the medieval age. Is it not possible then that Harris,
Locke, Mun, and Mandeville were influenced by scholastics? (And that
they, in turn, influenced Smith?) Is it not also possible that Smith him-
self read the works of Persian and non-Persian Muslim writers in
Latin?

6. Concluding Remarks: Could Adam Smith

Have Been Influenced by Medieval Persian
Scholars?
In contrast to McNulty who argues that Thomas Aquinas’s view of eco-
nomic organization (and thus division of labor) is similar to that of
Plato, I would argue that Aquinas’s view of division of labor indicates
that he is in this (as well as other concepts) influenced by Persian or
other Muslims. Aquinas argued that “ S O the eye sees for the whole
body and the foot carries the whole body. Likewise, in what pertains to
all mankind, one man is not able to do all the things which are needed
in a society, and, accordingly, different people properly work at differ-
ent tasks” (quoted in McNulty 1975, 373).
I see this statement to be closer to the views of Farabi, Ibn Sina, and
other Persian Muslims than to the view of Plato, particularly since it
emphasizes the complexity of the economic process, and the need for
cooperation, without the creation of a stratified society. In other words,
the source of Smith’s view could have been that which influenced Euro-

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pean scholasticism, and thus Harris, Locke, Mun, and others who influ-
enced Smith.
It is very difficult to find citations to the works of these Persian (or
Arab or Spanish) Muslims in the writings of scholastic (and postscho-
lastic) Europeans. The absence of citations should not prevent us from
tracing many of the economic (and noneconomic) ideas of scholastics
(or later writers) to Muslim sources. There are reasons for this void.
First, it is well documented that the scholastics held a denigrating view
of Islam and Muslims. It is that type of view which led to the Crusades.
As in the case of Schumpeter’s chapter 2, Europeans belittled the influ-
ence of Muslims and exaggerated their dependence on the Greek and
Roman heritage in order to form a new image of itself. Interestingly
enough, the only time scholastics cited Muslim sources was to point out
that the Muslims had erred (usually in theology); an example is
Aquinas. Otherwise, scholastics borrowed without giving reference.
Second, it is argued that the scholastics perceived Islamic theology
(which had incorporated Greek rationalism) and Muslim scholars such
as Ibn Sina and Ibn Rushd as threats to Christian dogma. The list of con-
demnation of ideas published by Stephen Tampier, Bishop of Paris in
1277, manifested these fears (Mirakhor 1988, 333). There are several
other examples of condemnation of the Islamic influence, including the
Oxford condemnation, also in 1277. According to Durant, Aquinas was
led to write his Summa Theologian to halt the threatened liquidation of
Christian theology by the Islamic interpretation of Aristotle (Durant
1950,913). Durant argues that “indeed the industry of Aquinas was due
not to love of Aristotle but to fear of Averroes [Ibn Rushd]” (954). Third,
borrowing without acknowledgment (from Muslim or other writers) was
an accepted and general practice among the scholastics. In fact, the same
seems to be true in Smith’s Wealth of Nations, which contains no bibli-
ography or endnotes. Richard Dales has also demonstrated that certain
European writers borrowed, without citation, from the ideas of Gros-
seteste (Mirakhor 1988, 334). Many historians have shown that med-
ieval Europeans borrowed, explored, and elaborated the ideas, writings,
and teachings of Muslim scholars with amazing openness. For example,
a thirteenth-century European philosopher, Bar Hebraeus, copied many
chapters from Ghazali’s Ihya (a book containing many of Ghazali’s eco-
nomic ideas) without giving him any credit. Interestingly enough, Bar
Hebraeus’s book was fundamental in monastary teaching (334). On that
basis, it is not unreasonable to assume that Aquinas’s view of division of

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678 History of Political Economy 30:4 (1998)

labor, which resembles the Islamic view rather than the Platonic one,
can be traced to Farabi, Ibn Sina, Ghazali, or other Persian writers.
Other writers have made a similar comparison between the views of
Grossetes te, Magnus, Bacon, and Witelo (a thirteenth-century Polish
philosopher) and those of the medieval Muslim (including Persian)
scholars. They also conclude that the ideas of these scholastics are
traceable to those of medieval Muslims (Persian, Arab, or Spanish) (see
Crombie 1963, Briffault 1928, Afnan 1958, and Sharif 1966).
It can be argued that in terms of borrowing from Persian, Arab, and
Spanish Muslims, European scholastics had a dual criteria. If they
agreed with an idea and found it reasonable, they borrowed it without
giving any reference to the authors. For example, Aquinas agreed with
many chapters of Ghazali’s Zhya and borrowed from it without giving
any reference to Ghazali. It is also believed that the Spanish Domini-
can monk Raymond Martini borrowed from several of Ghazali’s books
without giving any reference to Ghazali. Aquinas, who received his
education from the Dominican order at the University of Naples, knew
the works of Ghazali (and other Persians such as Ibn Sina) either
directly, or at least through Bar Hebraeus’s and Martini’s works (Sharif
1966, 1362). Robert Hammond, a historian of philosophy, has done a
comparative study of Farabi and Aquinas. He has argued that the views
of these two philosophers are virtually identical (Hammond 1947). (It
seems to me that the same is true of these two writers’ views concern-
ing division of labor.) According to Hammond, Aquinas used Farabi’s
proof of the existence of God, or certain of Ghazali’s theological dis-
cussions, without giving any reference to them. However, when the
scholastics disagreed with a concept or found it contrary to Christian
dogma, they rejected it in the strongest language and provided the
source of that concept. Two examples are Aquinas’s rejection of some
of the ideas of Ibn Rushd in Summa Contra Gentiles, and Albert Mag-
nus’s writings against Ibn Rushd, in which Magnus mentions Ibn Rushd‘s
name and his writings (see, for example, Magnus 1940).
The scholastic Europeans’ borrowings of the economic concepts of
Persian Muslims also fall into the same two categories-accepting
without reference, rejecting with reference. Aquinas’s discussion of
division of labor, which resembles Persian views, seems to be of the
first category. Many other economic concepts discussed by Persian and
non-Persian Muslims could have entered (and most probably did enter)
Europe in the same way.

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 History of Political Economy

Hosseini / Smith’s Division of Labor and Medieval Persia 679

Given the transmission of the economic knowledge of Persian schol-

ars to Europe, the impact of European scholastics on writers such as
Petty, Harris, Locke, Mun, and Mandeville, and the similarities of
Smith’s view (or the views of Petty and others) of division of labor and
that of Persian writers, including the similarity of examples given, it
would not be illogical to assume that Smith was influenced by those
writers. In addition, according to Todd Lowry (as suggested to me by
S. M. Ghazanfar in a personal communication), Smith’s personal
library contained the Latin translations of some of the works of Persian
(and Arab) scholars of the medieval period. Given the above-men-
tioned similarities, it is not unreasonable to assume that Adam Smith or
the others (Petty, Harris, and so forth) could have read the works of
medieval Persian scholars.

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