Inthefinaltwobooksofhisgreatwork,TheWealthofNations,AdamSmithelaborateshisviewsonsomeofthekeyeconomicissuesofhis–andourown–times.ItisherethatSmith(1723-90)offershisconsideredresponsetotheFrenchPhysiocrats,perhapsthefirstgreatschoolofeconomictheorists.Itisalsoherethatheassessesthenatureofthemercantilesystem,andparticularlythecolonialrelationshipwithAmerica,whoseachievementscouldhavebeenevenmorespectacularinconditionsoffreetradeandperhapseconomicunion.EvenontheeveoftheDeclarationofIndependence,SmithfamouslypredictedthatAmerica'willbeoneoftheforemostnationsoftheworld'.Anditisherethathedevelopsthecaseforalimitedstateroleineconomicplanning,notablytocombatmarketfailureandinduceefficiencyinareassuchaseducation,publicworks,justiceanddefence.Hispioneeringanalysisstillprovidesmanysubtleandpenetratinginsightsintooneoftoday'smostvitalandcontroversialpolicydebates.