Which book, authored by Adam Smith, outlines key theories related to capitalism?

The book authored by Adam Smith that outlines key theories related to capitalism is "The Wealth of Nations." Published in 1776, this foundational text is crucial in the study of economics and the development of capitalist thought. Smith analyzes the nature and causes of wealth in a nation, emphasizing the importance of free markets, competition, and the division of labor. He introduces concepts such as the "invisible hand," which suggests that individuals pursuing their own self-interest inadvertently contribute to the economic well-being of society.

While other works by Smith, like "The Theory of Moral Sentiments," address morality and ethics in economic behavior, they do not focus primarily on capitalism or economic systems in the manner that "The Wealth of Nations" does. "The Capital," often associated with Karl Marx, critiques capitalism rather than outlines its theories, and the phrase "The Invisible Hand" refers to a concept within "The Wealth of Nations," but it is not a standalone book. Thus, "The Wealth of Nations" is correctly identified as the key work elucidating capitalism and its mechanisms.