What did Adam Smith mean by "putting [the pins] into the paper"?
Alecos is correct that Smith is talking about packaging, but I don't believe that "paper" refers to a paper bag.

Straight pins used to be sold on sheets of paper (usually as sets of a dozen), through which they passed twice, like so:



So by "put them into the paper" Smith means exactly what he said: the pins are put into paper before being sold.