The invisible hand

Mapping the Invisible Hand

After amputation, individuals often have vivid experiences of their absent limb (i.e., a phantom limb). Therefore, one's conscious image of one's body cannot depend on peripheral input only (Ramachandran & Hirstein, 1998). However, the origin of phantom sensations is hotly debated. Reports of vivid phantoms in the case of congenital absence of the limb show that memory of former body state is n...

The Invisible Hand

The marginalist revolution transformed the principles of price determination in competitive markets. Nevertheless, the systematization that accompanied neo-classical theory, especially Walras’ general equilibrium formulation, confirmed Classical economists’ belief, most powerfully articulated by Smith, that impediments to free trade should be removed. So, while the transition from the Classical...

A helping hand for the invisible hand.

Equilibrium Versus the Invisible Hand

Twentieth century equilibrium modeling depicts an end state toward which an economy tends, whereas the invisible hand, as Adam Smith depicted it, suggests an economy continually progressing as an increased division of labor is produced by growing markets. Thus, there is an inherent tension between the concepts of an equilibrium outcome versus the invisible hand process. The paper discusses diff...

Cantillon and the Invisible Hand

The invisible hand remains an important foundation of economic analysis, continues to be a source of new analytical and explanatory devices, and is the conceptual basis of a whole class of scientific models throughout the sciences. Indeed, Smith’s famous concept has experienced a resurgence of interest as several new interpretations of the concept have been published in the leading general-inte...