Need a Hand?

Adam Smith was a Scottish economist, who lived from 1723 to 1790 and wrote his most famous work, The Wealth of Nations, a book on free market economy. This describes an economy not restricted by the government or anyone else. In other words, people voluntarily buy and sell whatever the heck they want based upon supply and demand. In his book, Smith refers to an Invisible Hand, which is the idea that by serving themselves, people actually help society as a whole. People willingly enter into professions not to aid other people, but because they want to help themselves and choose the most profitable career. But they cannot do everything. For example, the baker bakes bread to sell for money, not because he wants to prevent starvation. The basket weaver likewise does not give away his creations for free, but will sell his baskets to the baker so that the baker may carry his goods to market. The cobbler, too, crafts shoes to sell to the baker and basket weaver so that both may travel to the market. And in turn, the shoe maker buys bread to eat and baskets in which to carry his tools. These three men buy and sell to each other not out of the goodness of their hearts, but because they require money–to purchase each others products, which they need to survive. This is the Invisible Hand at work which Adam Smith refers to in The Wealth of Nations.

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