Econ-ity » December 23, 2014

Daily Archives: December 23, 2014

Basics of The Invisible Hand

  • Wealth is not finite and cannot simply be measured by money or gold:
    The wealth of a nation or individual cannot be measured simply through the amount of money they possess. Rather, wealth can be assessed with the help of the goods and services that are one possess or, at least, is able to acquire, albeit, through hard work.
  • Trade allows the parties to meet desired ends:
    It is through trade that individuals can exchange goods and services and thus fulfill a wide range of demands. In the absence of trade an individual or group would have no choice but to create the product they desire, with trade though, the individual or group can trade what they do best with some good or service that another party manufactures best.
  • Every individual strives to become wealthy by pursuing his/her own wellbeing:
    People, no matter how altruistic or self-centered, perform actions to fulfill their own needs in an attempt to cater to their own satisfactions. However, in doing so, end up providing for the needs of others as well.
    A butcher butchers not to fulfill the needs of others but in an attempt to better his own life. However, the butcher’s action allows others to satisfy their demand for meat.
  • It is important to eliminate restrictions an individual has to face to better their condition:
    Whenever there is no government intervention, markets operate at the natural level as individuals perform best when they are allowed to discharge their own actions.
  • Desirable ends can be reached by maintaining natural liberty:
    No individual or entity will ever be able to fully realize the potentials of the individual beside the individual themselves. Therefore, attempting to channel a person toward a certain end will simply infringe upon their natural liberty and result in inefficiencies.
Anurag Pant

About Anurag Pant

Anurag holds a Bachelors of Science in Economics and works as a Research Assistant at Samriddhi, the Prosperity Foundation. He also lectures on Economics at Xavier International College.

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