Thursday, March 23, 2006

Not a Smithian Market

Buddy Walker, ‘Columnist’ (‘Give me liberty, illegal drugs or give me death’) in The Daily Athenaeum, West Virginia University

“Drug dealers are not evil by definition - they are simply the result of Adam Smith's invisible hand on a market forced into the shadows.”

Read it at:


The drug trade is hardly a Smithian market. Drug gangs are oligopolists trying to become monopolists by killing rivals, not competing on price or quality.

Of all the anti-monopoly sentences Smith wrote I do not recall him associating markets with murderous violence or with disregard for the consumers. Quite the reverse. He would recognise such behaviour in theEast India Company, a chartered monopoly that devasted the Indian sub-continent.

On the latest misuse of the invisible hand metaphor and associating it with Adam Smith, I have no comment.


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