The Invisible Hand

My friend and I were discussing some things the other night, and one of the subjects was about things we need to do in order to fit in to "polite" society.  For instance, if you are going to be powerful and rich and hob-nob with all the fancy-schmancy people you better not use the words "fancy-schmancy" in a sentence. You probably should also know something about at least one artist from each art period.  Even if you hate art.

One of the ways I fit in with fancy-schmancy people (no, I have not rubbed elbows with very many) is by wearing clothes that don't have stains or holes in them and also by being humble.  And correcting their mistakes.  While being humble but knowledgable.  Or at least that's what I'd do if life were a movie and I got the chance to play that part.

With that being said, here is your random fact for the day:

Adam Smith, the philosopher and economic genius who wrote Theory of Moral Sentiments  and also wrote Wealth of Nations which shaped capitalism and allowed the rise of economic prosperity for all is misquoted all the time in society.  In the latter book, Smith refers to an invisible hand.

People now say "Smith refers to an invisible hand as on that guides market forces to determine price and supply and demand."  But that is simply untrue.

Smith uses the phrase once in each book.  This is the excerpt from Wealth of Nations:
“By directing that industry in such a manner as its produce may be of greatest value, he intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention.”5


Now, Smith did this awesome thing and divorced economics from morals, something that we take for granted nowadays.  His view was that we could all act selfishly and with our own best interests in mind, and that the invisible hand would still guide us towards a better common good.  So, the means is not reflected in the ends.

Smith also divorced moral philosophy and God.  If you are interested in ethics explained from a non-religious and non-metaphysical sense, check out Theory of Moral Sentiments.  Or just Google it.  But please, don't listen to Wikipedia!

UPDATE:  Here is a really good article if you're super interested.