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The invisible hand is a metaphor inspired by the Scottish economist and moral philosopher Adam Smith that describes the incentives which free markets sometimes create for self-interested people to accidentally act in the public interest, even when this is not something they intended. Smith originally mentioned the term in two specific, but ...
In economics the "visible hand" is generally considered to be the macro-fiscal policy of John Keynes that emerged in the 1930s as a remedy for the shortcomings of Adam Smith's "invisible hand" and advocated government intervention in the economy. [4] Actually, Smith already identified the disadvantages of the "invisible hand". [5]
Rational choice theory looks at three concepts: rational actors, self interest and the invisible hand. [4] Rationality can be used as an assumption for the behaviour of individuals in a wide range of contexts outside of economics. It is also used in political science, [5] sociology, [6] and philosophy. [7]
The subjective experience of being unseen by others in a social environment is social invisibility. A sense of disconnectedness from the surrounding world is often experienced by invisible people. This disconnectedness can lead to absorbed coping and breakdowns, based on the asymmetrical relationship between someone made invisible and others. [5]
Chandler uses eight propositions [3] to show how and why the visible hand of management replaced what Adam Smith referred to as the invisible hand of the market forces: . that the US modern multi-unit business replaced small traditional enterprises, when administrative coordination permitted better profits than market coordination;
The philosopher and economist Adam Smith opposes this (although he defends a moderated version of this line of thought in his theory of the invisible hand), since Mandeville fails, in his opinion, to distinguish between vice and virtue.
In Smith's work, his invisible hand describes the self-regulating behavior of the market. In essence, this theory states that individual personal motivations lead to the most efficient allocation of resources and greatest overall benefit, even if those motivations were not in any way benevolent.
Invisible hand is a term used by Adam Smith to describe the basis of the self-regulating nature of the marketplace. Invisible hand may also refer to: Invisible Hand, a 1960s and 1970s Polish Television series; Invisible Hand, the flagship of General Grievous in Star Wars: Episode III – Revenge of the Sith