Adam Smith and the other side of the invisible hand

28 Mar, 2014 at 13:07 | Posted in Economics | 1 Comment

thmorsentHow selfish soever man may be supposed, there are evidently some principles in his nature, which interest him in the fortune of others, and render their happiness necessary to him, though he derives nothing from it except the pleasure of seeing it. Of this kind is pity or compassion, the emotion which we feel for the misery of others, when we either see it, or are made to conceive it in a very lively manner. That we often derive sorrow from the sorrow of others, is a matter of fact too obvious to require any instances to prove it; for this sentiment, like all the other original passions of human nature, is by no means confined to the virtuous and humane, though they perhaps may feel it with the most exquisite sensibility. The greatest ruffian, the most hardened violator of the laws of society, is not altogether without it.

1 Comment

  1. If the logic of what he’s saying on many issues seems inconsistent with his adherence to models, then you have to look elsewhere for why he continues to adhere to them. It’s probably a pretty simple interest-based reason, i.e., his profession is wedded to these models, and you can’t advance easily within it or receive credibility within it without doing obeisance to the Math-Model Goddess. Those are very important interests to him, I would assume, and they would be threatened if he told everyone in his profession that the emperor had no clothes and that everything they were doing was “brilliantly silly.” Consciously or unconsciously, I think Krugman knows how his bread is buttered, and something in his mind probabl tells him that denouncing silly models is a place he dare not go for professional reasons.


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