The correct option is E Adam Smith wrote two major books that are to democratic capitalism what
This sentence opens with an appositive phrase. When this happens it always modifies the subject - Adam Smith. However, in the first three choices, Adm Smith is in the possessive and becomes a modifier with 'books' being the real subject. Now, 'a leading figure of Scottish Enlightenment' cannot possibly refer to books. Thus, options A, B and C are incorrect. D and E are most similar to each other. However, D uses a idiomatic phrase '...books that are to democratic capitalism similar to...' which is incorrect. The correct idiom is '...books that are to democratic capitalism what...' which is seen in E (here, 'what ' signifies the relationship that is active between the two). Thus, E is the correct answer with correct grammar and idiom.