Jump to ContentJump to Main Navigation
Morality, Competition, and the FirmThe Market Failures Approach to Business Ethics$
Users without a subscription are not able to see the full content.

Joseph Heath

Print publication date: 2014

Print ISBN-13: 9780199990481

Published to Oxford Scholarship Online: May 2015

DOI: 10.1093/acprof:osobl/9780199990481.001.0001

Show Summary Details
Page of

PRINTED FROM OXFORD SCHOLARSHIP ONLINE (www.oxfordscholarship.com). (c) Copyright Oxford University Press, 2018. All Rights Reserved. Under the terms of the licence agreement, an individual user may print out a PDF of a single chapter of a monograph in OSO for personal use (for details see www.oxfordscholarship.com/page/privacy-policy).date: 11 December 2018

The History of the Invisible Hand

The History of the Invisible Hand

Chapter:
(p.205) 8 The History of the Invisible Hand
Source:
Morality, Competition, and the Firm
Author(s):

Joseph Heath

Publisher:
Oxford University Press
DOI:10.1093/acprof:osobl/9780199990481.003.0009

This chapter examines the “invisible hand” theory proposed by Adam Smith. It explains how Smith uses the phrase as a description of unintended social benefits resulting from individual actions, and the way that markets promote cooperation. It enumerates two famous positions of the theory which became prevalent in different periods: the incentive argument, popularized by Emile Durkheim during the early twentieth century, which discusses how markets were superior to other institutional forms because they allowed society to economize on moral motivation; and therefore the market, proposed by Friedrich Hayek during the advent of large-scale bureaucratic organizations and centrally planned economies that consists of large multidivisional companies, which states that markets allow society to economize on knowledge. The chapter analyzes the history and development of these two different lines of thought, and shows how the various theories came together to provide the most sophisticated case for the market.

Keywords:   invisible hand, Adam Smith, unintended social benefits, Emile Durkheim, moral motivation, Friedrich Hayek, incentive argument, information argument

Oxford Scholarship Online requires a subscription or purchase to access the full text of books within the service. Public users can however freely search the site and view the abstracts and keywords for each book and chapter.

Please, subscribe or login to access full text content.

If you think you should have access to this title, please contact your librarian.

To troubleshoot, please check our FAQs , and if you can't find the answer there, please contact us .