Tuesday, June 21, 2011

A Newly Discovered Role for the Invisible Hand

Russ Roberts of Café Hayek, writes (HERE):

‘A good week for thinking about Adam Smith’

It connects to video of a lecture by Daniel Klein (Professor at GMU, Fairfax, Virginia) on Adam Smith to a class meeting in Sweden.

Daniel Klein gives an interesting lecture on Moral Sentiments to an audience of Swedish postgrad students. I have debated with Daniel a couple of times on Adam Smith’s use of the Invisible Hand metaphor (see Econwatch, 2009 and more recently see Economic Affairs, 2010) and he is a well-informed, articulate, and always courteous scholar, who shares my passion for Adam Smith’s Works.

Our different takes on the meaning and significance of the IH metaphor does not mean I respect him less (perish the thought). Any student wanting to undertake research or classes in Adam Smith’s moral philosophy and political economy is recommended to take any opportunity to visit or attend classes at George Mason University. They are building a first-class reputation in Adam Smith studies there (look them up on the Web).

However, my differences with Daniel’s interpretation of Adam Smith’s Works have not diminished my respect for his writings and his participation in the republic of letters. We learn much from our better-informed critics.

Daniel’s account of the impartial spectator is interesting, though his throwaway afterthought of using the simile of the impartial spectator as like a ‘monotheistic god’ caught my attention, and I shall think about it, though my immediate response is to question its credulity.

When in the latter stages of his short lecture he introduced the ‘invisible hand’ in Smith’s moral theory in a major role (without the slightest textual evidence in support of his contentions) I was immediately struck by his querulous assertion.

Daniel links his (not Smith’s) novel interpretation of the IH metaphor in Moral Sentiments to ‘Smith’s presumption of liberty’, yet did not explain how or what the ‘invisible hand’ did exactly in this new role.

In fact the single direct textual reference to the IH metaphor in TMS directly concerned a time when the regime of ‘proud and unfeeling’ landlords ruled in Europe (and even before to there were landlords in pre-historic millennia in the near East when ‘the earth was divided unequally’, through all of which times nothing remotely like ‘natural liberty’ prevailed, or was known).

I found this section of Daniel’s lecture utterly unconvincing, but I wait to be corrected, with textual references from Smith. Where we present our own interpretations (which may have or not have legitimacy) we should not slide them into an account without any notice as if they are the legitimate views of Adam Smith. If we speculate we should say so.

Follow the link and watch Daniel’s lecture.

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