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The Invisible Hand by Adam Smith Video Lecture | Sociology Class 12 - Humanities/Arts

62 videos|137 docs|25 tests

FAQs on The Invisible Hand by Adam Smith Video Lecture - Sociology Class 12 - Humanities/Arts

1. What is "The Invincible Hand" by Adam Smith?
Ans. "The Invincible Hand" is not a specific work by Adam Smith. The correct term is actually "The Invisible Hand," which is a metaphor Adam Smith used in his book "The Wealth of Nations" to describe the self-regulating nature of the market economy.
2. What does the concept of the "Invisible Hand" mean?
Ans. The concept of the "Invisible Hand" refers to Adam Smith's belief that individuals, in pursuing their own self-interests, unintentionally promote the well-being of society as a whole. According to Smith, by pursuing their own profits, individuals are led by an invisible hand to create a balanced and harmonious market system that benefits society.
3. How does the "Invisible Hand" work in the market economy?
Ans. The "Invisible Hand" works in the market economy through the interaction of supply and demand. When individuals in pursuit of their own interests produce goods and services, they offer them to the market. The market, driven by consumer demand, determines the price and quantity of these goods. The "Invisible Hand" ensures that resources are allocated efficiently and that the market reaches equilibrium.
4. What is the significance of the "Invisible Hand" in economics?
Ans. The "Invisible Hand" is significant in economics as it highlights the importance of free markets and individual self-interest in promoting economic prosperity. It suggests that government intervention and control should be minimal, allowing the market to regulate itself. The concept has had a profound impact on the development of capitalist economic theory.
5. Can the "Invisible Hand" be applied to all aspects of society?
Ans. While the concept of the "Invisible Hand" primarily applies to the market economy, some argue that it can be extended to other aspects of society. They suggest that individuals pursuing their own interests can indirectly benefit society in areas such as education, healthcare, and social welfare. However, the applicability of the "Invisible Hand" beyond the market remains a subject of debate and interpretation.
62 videos|137 docs|25 tests

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