Erasing the Invisible Hand: Essays on an Elusive and Misused Concept in Economics

Description

This book examines the use, principally in economics, of the concept of the invisible hand, centering on Adam Smith. It interprets the concept as ideology, knowledge, and a linguistic phenomenon. It shows how the principal Chicago School interpretation misperceives and distorts what Smith believed on the economic role of government. The essays further show how Smith was silent as to his intended meaning, using the term to set minds at rest; how the claim that the invisible hand is the foundational concept of economics is repudiated by numerous leading economic theorists; that several dozen identities given the invisible hand renders the term ambiguous and inconclusive; that no such thing as an invisible hand exists; and that calling something an invisible hand adds nothing to knowledge. Finally, the essays show that the leading doctrines purporting to claim an invisible hand for the case for capitalism cannot invoke the term but that other nonnormative invisible hand processes are still useful tools.

Warren J. Samuels is Professor Emeritus of Economics at Michigan State University, where he taught from 1968 to 1998. He previously served on the faculties of the University of Missouri, Georgia State University, and the University of Miami. One of the most prolific historians of economic thought, with cognate interests in the philosophy of economics, public finance, and law and economics, he has been president of the History of Economics Society and the Association for Social Economics. Professor Samuels was awarded the Kondratieff Medal by the Kondratieff Foundation of Moscow. He is the author of more than ten books and the editor of several dozen titles, as well as more than seventy volumes in the series Research in the History of Economic Thought and Methodology and Recent Economic Thought, as well as for the Journal of Economic Issues. He received his PhD from the University of Wisconsin. Marianne F. Johnson is Professor of Economics at the University of Wisconsin, Oshkosh. She is co-editor of the series Research in the History of Economic Thought and Methodology and has co-edited two multi-volume projects on early American economic thought. William H. Perry is a professional lexicographer with more than thirty years experience in constructing and searching large evidentiary and documentary research databases for special projects. For this work, Mr Perry constructed a database containing, in machine-readable format, all significant philosophical, religious, scientific, political, and economic primary and secondary sources from the beginnings of Western and Middle Eastern civilization until the end of the nineteenth century, searchable by concept.

'An unbelievably comprehensive account of what economists have meant by the invisible hand. This book should disabuse anyone of the notion that the concept is either simple or unproblematic.' Roger E. Backhouse, University of Birmingham 'The invisible hand is the iconic image in the discourse about economics. But it may also be the most chameleon-like of all economics images. No term in economics has meant so much, so differently, to so many. And no one has taken on the enormous task of sorting out and analyzing these many invisible hands ... until now. Warren Samuels makes a seminal contribution to the literature by taking us on a thorough and richly thoughtful analysis of the many meanings of the invisible hand. No one has the breadth and depth of vision to do it better.' Jerry Evensky, Syracuse University 'Adam Smith's invisible hand has often been presented as a foundational concept in economics, and one that provides the basic welfare justification for free markets. In this valuable book, Warren Samuels subjects the invisible hand concept to sustained critical examination. His work explodes the myths surrounding the concept and displays the many ambiguities and lacunae to be found in the conventional treatments. This book is both a testament to the power of the invisible hand metaphor and a vital and long overdue corrective to its misuse in economics.' Malcolm Rutherford, University of Victoria, Canada 'Anyone who thinks we haven't learned much since Adam Smith should peruse this book, with its painstaking discussion of several hundred subsequent commentators, in the service of showing Smith to have been the author of a matrix of mutually supporting interpretations of market order inevitably within an institutional framework. The result, as the poet says: 'And the end of all our journeying/Will be to arrive where we started/And know the place for the first time'.' David Warsh, economicprincipals.com 'Warren Samuels has written an authoritative, detailed and mainly original contribution to scholarship, ably assisted by his collaborators, Marianne Johnston and William Perry.' Gavin Kennedy, EH.net