Lesson 1: The Invisible Hand - Intercollegiate Studies Institute

Lesson 1 Lesson 1: The Invisible Hand

Presented by: Dr. Daniel Hammond
Wake Forest University

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Fundamental Economic Concepts from the Classics

Producing goods and services from scarce resources is the fundamental economic problem that all nations face. In this lesson we will consider how “the invisible hand” process famously described by Adam Smith solves that problem, in part by engaging the division of labor to efficiently maximize the production process.

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HMW Lesson 1: The Invisible Hand Quiz

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The world of commerce as described in this lesson is controlled at every level and runs smoothly due to an intricate system of management and control.
- True
- False

The laws of economics reveal to us what Adam Smith called "the invisible hand," which orders market processes to the benefit of societies.
- True
- False

Adam Smith famously denied that there was anything particular about human nature that inclines us toward the production of wealth.
- True
- False

"It is the great multiplication of the productions of all the different arts, in consequence of the division of labour, which occasions, in a well-governed society, that universal opulence which extends itself to the lowest ranks of the people."

Adam Smith

"The key task facing any economy is the allocation of scarce resources which have alternative uses."

Thomas Sowell

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Fundamental Economic Concepts from the Classics, Part IV with Dr. Daniel Hammond

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Adam Smith: The Invisible Hand with Dr. James Otteson and Learn Liberty

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James Gwartney, et al., Common Sense Economics, pp. vii-ix, 5-14

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Adam Smith, An Inquiry into the Nature and Causes of the Wealth of Nations by Adam Smith, pp. 5-18, 418-422

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Frédéric Bastiat, Economic Sophisms, I.7.1 - I.7.29

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Lesson 1 Lesson 1: The Invisible Hand

Fundamental Economic Concepts from the Classics

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