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Market Dummy and Social Animal: Adam Smith’s Models of Man

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  • Manfred J. Holler

    (University of Hamburg)

Abstract

This paper discusses the relationship of the two models of man presented by Adam Smith in The Theory of Moral Sentiments and the Wealth of Nations—and the working of the invisible hand. There appears to be an inherent conflict of the market solution and the working of the price mechanism with “sympathy,” the key concept proposed in The Theory of Moral Sentiments, the source of social evaluation, self-evaluation and individual action—and the impartial spectator controlling individual action. We will give an extended explanation for this incongruence and, given this background, elaborate on Smith’s social program of educating the common people. References to John Rawls’ Theory of Justice, Ken Binmore’s evolutionary theory of fairness, and Karl Polanyi’s critical comments in The Great Transformation on the emergence of the market society demonstrate that Smith does not give us a moral theory but a tool kit for moral behavior, on the one hand, and conditions and implications of a market economy, on the other—exemplified by the two models of man which he applies.

Suggested Citation

  • Manfred J. Holler, 2024. "Market Dummy and Social Animal: Adam Smith’s Models of Man," Homo Oeconomicus: Journal of Behavioral and Institutional Economics, Springer, vol. 41(1), pages 29-50, December.
    • Handle: RePEc:spr:homoec:v:41:y:2024:i:1:d:10.1007_s41412-024-00146-5
    DOI: 10.1007/s41412-024-00146-5
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    References listed on IDEAS

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    1. Jacob Viner, 1927. "Adam Smith and Laissez Faire," Journal of Political Economy, University of Chicago Press, vol. 35(2), pages 198-198.
    2. Salter, John, 1994. "Adam Smith on Justice and Distribution in Commercial Societies," Scottish Journal of Political Economy, Scottish Economic Society, vol. 41(3), pages 299-313, August.
    3. Weinstein, Jack Russell, 2006. "Sympathy, Difference, And Education: Social Unity In The Work Of Adam Smith," Economics and Philosophy, Cambridge University Press, vol. 22(1), pages 79-111, March.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Models of man; Adam Smith; David Hume; Karl Polanyi; Ken Binmore; John Rawls; Social ethics; Moral theory; Significant other; Impartial spectator; Invisible hand; Education of the common people;
    All these keywords.

    JEL classification:

    • B10 - Schools of Economic Thought and Methodology - - History of Economic Thought through 1925 - - - General
    • B12 - Schools of Economic Thought and Methodology - - History of Economic Thought through 1925 - - - Classical (includes Adam Smith)
    • B20 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - General
    • B41 - Schools of Economic Thought and Methodology - - Economic Methodology - - - Economic Methodology

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