Adam Smith's work, The Wealth of Nations, gave him an association with capitalism and the invisible hand that guides individuals in economic activities. This invisible hand is both local in nature and benefits the individual and the community as a whole. It promotes this free market system as a means by which the individual can provide for the needs of society by advancing their own interests. However, this market has its limits, although Smith admits that often an individual can harm society by pursuing their own self-interest. But these are exceptions and abuses and not how the market should work. This reliance on self-interest is effective in economic matters, but it is not the way the social or natural world should necessarily work. Although Smith criticizes these excesses and abuses, he fails to offer safeguards against them. In Kant's Foundations of the Metaphysics of Morals, he expressed the belief that treating people as ends and not as objects gives rise to a moral and happy community and can serve as a safeguard against a purely self-interested society. But Smith's emphasis on outcomes and Kant's emphasis on intentions mean that one system will sometimes take precedence over the other. Say no to plagiarism. Get a tailor-made essay on “Why Violent Video Games Should Not Be Banned”?Get the original essay Smith's reasoning for advocating for a free market where individuals can pursue their self-interests is at least in part due to his observation that men, like dog breeds, have various qualities such as speed, strength, and sagacity (Smith 15). The distinction Smith makes is that unlike animals, man is capable of directly benefiting from his peers through economic activity (Smith 15). According to Smith, this is due to the fact that “among men, on the contrary, the most dissimilar geniuses serve one another; the different products of their respective talents, by the general disposition to trucking, barter and exchange, being brought, as it were, into a common stock, where each can purchase any part of the product of the talents of others of which he needs. ” (Smith 15) This gives humanity the ability to specialize instead of individuals being forced to be the provider of all the goods and services needed by their family unit. Additionally, this specialization increases the economic productivity of a nation as a whole and provides the individual with more leisure because they are not required to perform all the tasks of creating goods and services. Having established that placing goods in a common stock provides society with an economy capable of supporting its needs, Smith turns to the driving force of this economic system. This concept of comparative advantage leads Smith to view self-interest as a means by which an individual advances his or her economy. society as a whole. To quote Smith: “It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from respect for their own interest. We address ourselves not to their humanity but to their self-love, and never speak to them of our own necessities, but of their advantages” (Smith 15). This underpins Smith's economic philosophy: by pursuing our own interests and comparative advantage, we achieve a more productive society. Smith, in this particular extract, uses three professions, all three involved in the production of goods. This is important because it can easily be said that the producer and theConsumers in these given situations benefit from the economic transaction. This is because the market has several producers of these products, which allows the market to achieve a market price that is suitable for both producers and consumers. The invisible hand of Smith's The Wealth of Nations has become the symbol of the force that guides this process. free market. Smith's idea of ​​the invisible hand, contrary to popular belief, is much narrower than many people in modern society think. Smith states: “In preferring the support of domestic industry to that of foreign industry, he aims only to ensure his own security; and in directing this industry in such a manner that its products may be of the greatest value, he aims only at his own gain, and he is in this case, as in many other cases, led by an invisible hand to promote an end which was not part of his intention…In pursuing his own interest he often promotes that of society more effectively than when he actually intends to promote it” (Smith 485). In this context, Smith simply meant that when an individual engages in economic activity in their immediate community or country, they benefit society as a whole. The “invisible hand” does not mean that every economic decision a person makes abroad will necessarily benefit the global economy or the individual. In this context, an individual acts in a market that he knows well, so he is more likely to know what his personal interest is. In this new global economy, it has become quite difficult for an individual to make decisions based on the limited information they have about foreign markets. Thus, the pursuit of one's own interest and, by extension, the benefit of other economic actors has become less obvious. The invisible hand was a metaphor intended to explain the benefits that self-interested decisions brought to a localized economy. But this metaphor is now used in a way that may not be very relevant in the age of a globalized economy. There is no doubt that self-interest and this invisible hand are the driving forces behind Smith's economic system. Although this often proves beneficial to society, inefficiencies and complications can arise within the system. The most obvious criticism of this system of self-interest concerns the abuses committed by producers. We have already discussed the benefits of market competition to the consumer, but what happens when there is a producer in a given market and that individual pursues his or her self-interest? Smith states that a monopoly can keep "the market constantly undersupplied, never fully meeting effective demand, sell its products well above the natural price, and increase its emoluments, whether wages or profits." , well above their natural rate. (Smith 69). By producing less than demand, the firm or individual pursues self-interest, but excludes individuals from the market and produces less than demand, reducing the overall productivity of an economic system. This does not serve society as a whole. as Smith argues, a free market should do it. Smith believes that the market would soon correct itself because those willing to buy the product would sell or withdraw capital to meet demand, in a perfect market economy (Smith 70). The problem I find with this, especially in the modern era where some monopolies exist, is that individuals could be excluded from the market for essential products, such as medicines and water. Although Smith believes it is rare for a monopoly to exist for long,this is often the case, and many in the United States have had to be divided into competing companies to preserve that competition that Smith advocates to bring down prices. This breakup of companies such as Standard Oil and Bell System was intended to eliminate these harmful practices that Smith knew monopolies were capable of continuing. Although Smith is right about both the effects of competition and monopolies, the self-interest of whoever controls a monopoly is at odds with that of society as a whole. Smith also criticizes the greed often demonstrated by the merchant class in its tendency to raise prices in order to make excessive profit: "Our merchants and our master manufacturers complain much of the evil effects of high wages in raising prices and thus reducing the sale of their goods both at home and abroad. They say nothing about the bad effects of high profits. They remain silent about the pernicious effects of their own gains. They only complain about those of others” (Smith 113). In this situation, the trader or manufacturer undoubtedly benefits from their decision to increase prices, but it places an unnecessary burden on consumers. The producer's decision is self-interested, which does not produce a more productive or happier society. Rather, it is a society in which a person or group of people profits from those who have the capital to pay for these goods, but those who cannot afford to pay these expenses are excluded from the market. Certainly, in Smith's ideal world of perfect competition, there would be other firms that would force the firm that charges too much to lower its prices. But companies have a strong incentive to collude, especially if the practice is legal. Even when such a practice is illegal, the sanction is often not a deterrent because the benefits often exceed this deterrent effect. Although this reinforces Smith's view that people generally make economic decisions based on self-interest, it constitutes an obstacle to the idea that all self-interest serves the benefit of society. Such collusion results in price fixing, which causes an economy to devote an unnecessary amount of resources to a particular product, which would be much less in a truly competitive market. Another problem concerns the idea that all economic transactions are both beneficial to all parties and to society. usually it makes some assumptions. First, the seller and buyer in a transaction have perfect information, without perfect information a seller can easily sell the consumer an overpriced or defective product. This is still seen today as many people purchase products such as cars with malfunctioning brakes, even though the producer had proof that there was a problem with the product. The second assumption is that all individuals act rationally with the information provided to them. The third assumption is that a market economy is always self-correcting with respect to equilibrium or natural price. This is certainly not the case when companies pursue their own interests and are allowed to collude or create a monopoly in the market. This market economy based on self-interest largely ensures a productive society, but it also creates complications that cause individuals to suffer. The market economy is effective in creating a productive society that benefits most economic actors. Smith defended an essentially unregulated free market, but if monopolies andOne thing that collusion has taught us is that some government regulation is necessary because the market does not always self-correct. Through these common-sense regulations aimed at protecting the consumer, in combination with a self-serving market economy, long-term growth and innovation should be achieved. Unfortunately, this rational model focused on self-interest is not a panacea for creating a happy and moral society. Although one is generally happier when one has a higher standard of living, which should result from this free market economy, at some point it can only have limited meaning. Even with the comforts that a free market economy can provide, a purely self-interested society would not provide the good that people often seek through social relationships. In fact, even in a self-interested market economy, we have seen that self-interest does not always produce economic outcomes beneficial to society as a whole. Kant differs from Smith in that it is above all the intention of an action that counts. and not the results. It is necessary to distinguish between Smith and Kant who speak of the creation of a productive society, and Kant of a moral society, but it is difficult to imagine a society which is both filled with immorality and economically productive. Smith's The Wealth of Nations fails to adequately address criticism that a purely self-interested approach to society can have a negative impact on its morality and social norms. Arguably, Kant's most important contribution to ethics was the treatment of persons as deserving of dignity; “See to it that you use humanity, whether in your own person or in the person of others, always at the same time as an end, never simply as a means” (Kant 41). Kant expresses here that people should never be treated as an object or a tool to achieve an end. Instead, people should recognize that all people are an end, which means that all people should be treated with the level of humanity they expect of each other. Smith's system of self-interested economic actors often led producers to treat consumers and workers as means rather than ends. . Raising prices in the name of profit, creating monopolies, and general disregard for the well-being of others is due to a lack of consideration for the humanity of others. If these actors acted under the assumption that people are an end rather than a means to their selfish goals, they would act in a self-serving manner that would preserve the humanity of those with whom they interact. Kant says, “It is impossible to think of anything in the world, or even beyond, that can be considered good without limitation except a good will” (Kant 9). Kant argues that this will that this individual possesses is all that matters in terms of the morality of a particular action. This intention-based moral system contrasts sharply with Smith's emphasis on the results of a given action. Moreover, the value that Kant places on intentions might also prove useful for Smith's system. Although Smith believes that self-interest is the best way to stimulate economic activity, considering morality would reduce the negative externalities we discussed previously. However, these two systems certainly come into conflict when an individual pursues an action with immoral intent that actually improves the productivity of society. For example, if a CEO, in his own interest, lied about the state of his company to obtain a loan, this would allow the company to avoid bankruptcy. Kant..