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#1
07-20-2007, 07:31 PM
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Invisible Hand
Noam Chomsky claims that in Adam Smith's book the wealth of nations he uses the phrase invisible hand only once, and not at all in the way that it has modernly been used. In free to choose Volunme 2 - The Tyranny of Control, Milton Friedman makes the opposite claim at the three minute mark; that Adam Smith used the invisible hand in his book The Wealth of Nations in the modern sense. Did Milton Friedman ever actually read the wealth of nations? Does it matter? It just fills me with a sense of unease...
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#2
07-20-2007, 07:32 PM
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Re: Invisible Hand
hmmm here is the original text
"But the annual revenue of every society is always precisely equal to the exchangeable value of the whole annual produce of its industry, or rather is precisely the same thing with that exchangeable value. As every individual, therefore, endeavours as much as he can, both to employ his capital in the support of domestic industry, and so to direct that industry that its produce maybe of the greatest value; every individual necessarily labours to render the annual revenue of the society as great as he can. He generally, indeed, neither intends to promote the public interest, nor knows how much he is promoting it. By preferring the support of domestic to that of foreign industry, he intends only his own security ; and by directing that industry in such a manner as its produce may be of the 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. Nor is it always the worse for the society that it was no part of it. By pursuing his own interest, he frequently promotes that of the society more effectually than when he really intends to promote it. I have never known much good done by those who affected to trade for the public good. It is an affectation, indeed, not very common among merchants, and very few words need be employed in dissuading them from it.
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#3
07-20-2007, 07:50 PM
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Re: Invisible Hand
Does it matter? No.
That's the beauty of the free market. It's an evolution of ideas from things that were initially intended for something else and/or coincidental. And then the market decides what works and what doesn't; or, the invisible hand. So it doesn't matter how the 'invidislbe hand' concept started out. What matters is how it's useful now.
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#4
07-20-2007, 10:22 PM
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Re: Invisible Hand
The original text appears to clearly use the concept "in the modern sense." From the Wikipedia entry:
[ QUOTE ] The invisible hand is a metaphor coined by the economist Adam Smith to illustrate how those who seek wealth by following their individual self-interest assist society as a whole and build the common good. [/ QUOTE ] Smith says essentially this in the text you quoted.
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#5
07-20-2007, 10:28 PM
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Re: Invisible Hand
yeah you're right, I guess chomsky was just making stuff up...
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#9
07-21-2007, 01:12 AM
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Re: Invisible Hand
Heh. I thought I remembered Chomsky saying that he sympathized with anarcho-syndicalism but that, given that wasn't going to happen, he favored socialism. I could be very wrong about that but if it's true then yes, Chomsky = jack booted thug.
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#10
07-21-2007, 01:15 AM
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Re: Invisible Hand
While it's possible he said that at one point in time, he is definintely an anarcho-sydnicalist / anarcho-socialist.
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Linear Mode
