The Invisible Hook

The Invisible Hand is the theory of economics that explains the driving forces that people have that allows them to make decisions. As Adam Smith put it in his 1776 tome An Inquiry into the Nature and Causes of the Wealth of Nations, in seeking to satisfy our own self interests, we're led, "as if by an invisible hand," to serve other's interests too. By this logic, the breadmaker cannot sew his coat and manufacture his car, so by seeking to satisfy those needs, he produces high quality and low cost bread to sell and be able to purchase a coat or a car. He indirectly has served the milk maid and sheriff by selling his goods to them, as they seek high quality low cost bread.

All of this you learn in your basic economics course, however today I'd like to mention what I'm learning in my current economics course, the economics of Piracy. What drives pirates to do what they do? Economics. Low costs and high benefits is what they seek, but they cannot meet their pirate ends without cooperating with other pirates. I'll hopefully talk about this again when I've learned more on the topic, I was just so excited about it from day one that I thought I'd share!

No comments: