Again, several thoughts.
1. I agree absolutely that Smith's principle value is as an early (though not the first) notable and thoughtful (though often mistaken) commentator on the nature of political oeconomy. As such, he either made several interesting original observations or conclusions, or promoted those of others (notably the Physiocrats, particularly Quesnay, and somewhat famously and controversially, James Steuart (not to be confused with James Mill or John Stuart Mill).
2. He's also been both mischaracterised (the "invisible hand" myth), and curiously ignored: his many cautions about monopolies, joint stock corporations, labour organisation, and the fundamental welfare of basic citizens. To that extent, reading Smith directly is a useful countermeasure to much spin that's been applied since.
3. On the labour theory of value, Smith's observations strike me as more valuable than many critics (particularly those inspired by opposing anything suggested by his mid-19th century German-British antecedent) give proper credit for. I'd argue that the Marginalists' focus on just marginal market cost and value is also fundamentally flawed, though frequently behaviorally accurate, at least in the short term.
Smith's discussion of prices, of the prices of various types of goods (commodities, rents, interest, labour, assets (coinage, though this can be extended) and, coached as "expenses of the sovereign", public goods, is actually quite informative, though it requires some interpretation.
In particular, Smith advances an idea largely ignored since the Marginal Revolution of a natural price, from which the actual observed market price may be higher, lower, or equal to:
When the price of any commodity is neither more nor less than what is sufficient to pay the rent of the land, the wages of the labour, and the profits of the stock employed in raising, preparing, and bringing it to market, according to their natural rates, the commodity is then sold for what may be called its natural price....
The actual price at which any commodity is commonly sold is called its market price. It may either be above, or below, or exactly the same with its natural price.
https://en.wikisource.org/wiki/The_Wealth_of_Nations/Book_I/...
Smith does write that "Labour was the first price, the original purchase-money that was paid for all things," but that's possibly better understood on several bases:
- Where all individuals are self-sufficient, this is fundamentally the case. Cost is time.
- Where there is a means of exchange for the labour of others, paying for that labour is the first and most evident, or manifest, cost.
- But labour is clearly not the only input, and more complete and accurate cost-based accounting systems reflect this. When Alexander Hamilton Church developed the foundations of what became modern cost accounting, his entries reflected the extant purchasing practices of manufacturers, whose major expenses were labour, raw material inputs, and plant capital.
https://archive.org/details/properdistribut02churgoog/page/n...
https://en.wikipedia.org/wiki/Alexander_Hamilton_Church
(And yes, related to the other A.H.)
The question of value in economics is still one that bedevils it, and for which a suggestion of Marx has excellent merits: what's discussed as "value" is actually three distinct constructs:
1). Cost. The requirements of poduction, including labour, rents, capital, and fully-accounted natural resources.
2). The exchange price, or ratio in some maximally-fungible commodity (usually money or an equivalent) by which one party is entirely willing to exchange to another.
3). Value. Most specifically use value or net benefit, which should almost certainly exclude merely short-term compulsion (viz: drug addiction and social media FOMO), but rather some long-term lifetime benefit or quality measure. Healthcare quality-adjusted life years would be an example, or Leslie White's Law of energy throughput as a measure of cultural development.
Note that Smith contradicts his own price theory when discussing rents:
"Rent, considered as the price paid for the use of land, is naturally the highest which the tenant can afford to pay in the actual circumstances of the land."
https://en.wikisource.org/wiki/The_Wealth_of_Nations/Book_I/...
That is: rents are not based on the labour required to provision them, but on the added labour value which can be extracted by way of rents.
So clearly there's more than just labour at play, even within Smith.
The extension of the "cost-of-inputs" model I find most attractive -- that's an "all costs are opportunity costs", extends beyond just presently-realised costs, ultimately taking into account natural resource costs, as energy- or time-of-formation, particularly at a given rate of utilisation vs. replenishment, against total utilisation time, which gives rise to significant revisions of pricing of exhaustible resources (or sinks) well beyond the clearly flawed visions of David Ricard, L.C. Grey, and Harold Hotelling.