The New Palgrave Dictionary of Economics

2018 Edition
| Editors: Macmillan Publishers Ltd

Invisible Hand

  • Mark Blaug
Reference work entry
DOI: https://doi.org/10.1057/978-1-349-95189-5_1217

Abstract

Adam Smith employed the term ‘invisible hand’ twice in his published writings, and a considerable secondary literature has explored the multiple meanings he intended to convey by the use of this metaphor. I argue that, whatever he did mean, he certainly did not mean that competition or the market mechanism promoted efficiency: instead it promoted the growth of income, even for the poor.

Keywords

Austrian economics Capital accumulation Classical competition Competition Competition as rivalry Cournot, A. Division of labour Ferguson, A. First fundamental theorem of welfare economics Hume, David Invisible hand Mandeville, B. Mercantilism Perfect competition vs free competition Productive and unproductive labour Scottish Enlightenment Smith, A. on invisible hand Spontaneous order Srewart, D. Turgot, A. Welfare economics 

JEL Classifications

B1 B3 
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Copyright information

© Macmillan Publishers Ltd. 2018

Authors and Affiliations

  • Mark Blaug
    • 1
  1. 1.