Conventional wisdom is a term often used to denote an idea, thought, or concept that is held as a general belief, but on close scrutiny does not stand up to practical application. An example of conventional wisdom is the belief that was commonly held before the advent of Adam Smith's The Wealth of Nations that the wealth of a nation was made up by the amount of money, or gold and silver possessed in its treasury. As Adam Smith demonstrated in his book, wealth is the sum total of the productivity within a nation. Governments following the mercantilist conventional wisdom implemented policies that hindered trade and the development of industries that actually did create wealth. In a specific case, the restrictions on free enterprise and the efforts to stem the flow of money out of England caused problems for Scotland and the British American Colonies. It was partly the application of conventional wisdom in the form of mistaken economic policies that eventually provoked the American Revolution.
Many give credit for coining the term "conventional wisdom" to John Kenneth Galbraith, the economist and writer, although others trace the phrase to the early 1800s. In any case, it was Galbraith who popularized the term in his book, The Affluent Society (1958). He wrote:
It will be convenient to have a name for the ideas which are esteemed at any time for their acceptability, and it should be a term that emphasizes this predictability. I shall refer to these ideas henceforth as the conventional wisdom...Ideas need to be tested by their ability, in combination with events, to overcome inertia and resistance. This inertia and resistance the conventional wisdom provides.
William Safire the noted columnist in Safire's Political Dictionary (p. 149) wrote his own brief definition, "Generally accepted, but often shortsighted conceptions; stodgy consensus subject to sharp changes of vogue opinion." He believes the phrase is derivative of a clerical phrase, received wisdom, which is often also used pejoratively as meaning ideas passed down from authority that have been accepted, but really need a thorough review.
Conventional wisdom should not be confused with common sense, which has a much more positive meaning, understanding ideas basic to existence and its sustenance. These ideas prompt prudent action and the exercise of good judgement. For example, a person with "common sense" would not put his hand in a jar filled with tarantulas. Often these phrases prompt opposite behaviors. Common sense often acts as a restraint, while conventional wisdom more often prompts ill-considered actions.