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Does the invisible hand hold or lead? Market adjustment in an entrepreneurial economy

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Author Info
Randall Holcombe ()

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Abstract

Adam Smith's “invisible hand” is one of the best-known phrases in economics, but its meaning is somewhat ambiguous. The invisible hand might be viewed as holding the economy close to equilibrium, yet Smith actually says that individuals are led by an invisible hand. Entrepreneurial forces lead an economy along a path that generates economic progress, and that path is determined by the disruptive forces of entrepreneurship. Rather than viewing an economy as tending toward an equilibrium, it is more accurate to view an economy as characterized by continuing progress, led by the invisible hand of entrepreneurial activity. Copyright Springer Science + Business Media, Inc. 2006

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File URL: http://hdl.handle.net/10.1007/s11138-006-7347-2
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Publisher Info
Article provided by Springer in its journal The Review of Austrian Economics.

Volume (Year): 19 (2006)
Issue (Month): 2 (June)
Pages: 189-201
Download reference. The following formats are available: HTML (with abstract), plain text (with abstract), BibTeX, RIS (EndNote, RefMan, ProCite), ReDIF
Handle: RePEc:kap:revaec:v:19:y:2006:i:2:p:189-201

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Web page: http://www.springerlink.com/link.asp?id=100335

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Related research
Keywords: Entrepreneurship; Equilibrium; Growth; Invisible hand; Progress;

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This page was last updated on 2009-11-25.


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