Who does Smaug represent?

Answer 1

Tolkien once wrote that he hated allegory, so it's doubtful that Smaug represents any particular person, thing, or concept. I think Smaug is more or less exactly what he appears to be: a big, nasty, greedy, evil dragon.

Evil dragons hording treasure are something of a staple in Germanic mythology, which in its Anglo saxon form Tolkien spent much of his life studying (he was a professor of medieval literature after all). In the legend of Sigurd / Siegfried Fafnir the dragon is guarding a treasure horde and in the Anglo Saxon epic Beowulf there's another dragon guarding a horde who becomes enraged when someone steals from his treasure and emerges in a rage exactly the same way Smaug does when Bilbo steals from Smaug. So, I wouldn't say Smaug represents anything. I would say rather that Tolkien was trying to create a modern myth and he did so in part by incorporating elements from medieval myths, in particular the Germanic myths that were native to England before the Norman Conquest. If you read Germanic myths you'll find a lot of parallels with Middle Earth as that is what Tolkien spent his days thinking about before he became a novelist.

Answer 2

Smaug, along with all other dragons in Middle Earth, is evil.