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INVISIBLE HAND
The Invisible Hand is an economic concept that describes the unintended greater social benefits and public good brought about by individuals acting in their own self-interests.[1][2] The concept was first introduced by Adam Smith in The Theory of Moral Sentiments, written in 1759. According to Smith, it is literally divine providence, that is the hand of god, that works to make this happen.
Invisible hand characterizes the mechanisms through which beneficial social and economic
outcomes may arise from the accumulated self-interested actions of individuals, none of whom intends to bring about such outcomes. The notion of the invisible hand has been employed in economics and other social sciences to explain the division of labour, the emergence of a medium of exchange, the growth of wealth, the patterns (such as price levels) manifest in market competition, and the institutions and rules of society. More controversially, it has been used to argue that free markets, made up of economic agents who act in their own self-interest, deliver the best possible social and economic outcomes. The idea of trade and market exchange automatically channeling self-interest toward socially desirable ends is a central justification for the laissez-faire economic philosophy, which lies behind neoclassical economics.[5] In this sense, the central disagreement between economic ideologies can be viewed as a disagreement about how powerful the "invisible hand" is. In alternative models, forces that were nascent during Smith's lifetime, such as large-scale industry, finance, and advertising, reduce its effectiveness.
TOPICS COVERED-
1) ADAM SMITH 2) THE INVISIBLE HAND IN ECONOMICS (https://www.masterclass.com/articles/what-is-the- invisible-hand-in-economics#who-was-adam-smith) 3) APPLYIG PREDICTABILITY TO UNDERSTAND THE INVISIBLE HAND (https://www.masterclass.com/articles/what-is-the-invisible-hand-in-economics#applying- predictability-to-understand-the-invisible-hand) 4) Economist's interpretation 5) UNDERSTOOD AS A METAPHOR 6) SOCIETY AND THE “INVISIBLE HAND” (https://www.britannica.com/biography/Adam- Smith/The-Wealth-of-Nations) 7) REAL WORLD EXAMPLES OF THE INVISBLE HAND (https://www.masterclass.com/articles/what-is-the-invisible-hand-in-economics#applying- predictability-to-understand-the-invisible-hand) 8) CRITICISMS
