From My Notebook, no. 10

N. Emrah Aydinonat. 2008. “The Invisible Hand in Economics How economists explain unintended social consequences”. Routledge

He asserts that the relations between ‘notions of ‘invisible hand’ and ‘invisible hand explanations’ is “not clear at all” (p 68). I agree. There is no connection. Aydinonat invents the link, albeit with literary finesse.

The “invisible hand is a metaphorical statement of the way in which natural and social phenomena should be explained”

Excepting the first six words above, the rest of the sentence has nothing at all to do with Adam Smith’s use of the IH metaphor.

In the History of Astronomy he refers to those individuals who ascribed the ‘irregular events of nature to the agency and power of their gods” (Smith 1795: 49).

Correct and that is all that can be said about pagan Roman beliefs. It signifies Smith’s “juvenile” abandonment of “pusillanimous superstition” (perhaps his Damascene conversion we could say of a confirmed member of his local Calvinist Church in Kirkcaldy, under his beloved mother’s and the local Minister’s spiritual guidance). He publicly manifested his future intentions in accepting the conditions of a Snell Exhibition to go to Oxford, specifically his ordination into the Church of England to become a Minister in the Scottish Episcopalian Church, affiliated to the Church of England.  In 1744 he changed his mind and changed his university courses from the Ordination sequence and opted, instead, to study ‘juris’ (jurisprudence), with the view to a career in scholarship, a risky change accepted by the Faculty at Balliol College and commented upon by his guardians.  Two years later he left Oxford for good without graduating, a less important career sacrifice than it would be today.

This may have been the first consequence of his researching and writing the HA Essay and realising the longer-term implications of his decision.  It may also partly explain why he kept his History of Astronomy Essay, started in 1744 and finished effectively some time before 1758 (in the text he predicts an eclipse for that year) and showed it to nobody, not even to his close philosophical friend David Hume, who only learned about its existence from Adam Smith in 1773, 21 years after they met (see Kennedy: ”Smith on Religion”, in ‘The Oxford Handbook on Adam Smith’. 2013. Eds. Chris Berry, Maria Pagannelli, Craig Smith). 

Smith also kept the Essay in his bedroom bureau until the end of his life and explicitly instructed his Executors from his death bed not to burn it but to publish it instead, though he ordered almost all of his other unpublished papers and manuscripts of unfinished books from his life’s adult work to be burned forthwith in 1790. Joseph Black and James Hutton, his executors carried out his instructions, publishing the Essay in 1795.  It was left to posterity to make what it could of his agnosticism in religious matters and the events that so moved in from 1744 (see Kennedy, “The Hidden Adam Smith in his Alleged Religiosity”, Journal of the History of Economic Thought, 2011, 3).

Emrah Aydinonat asserts that “the invisible hand in HA provides the methodological background for the use of the invisible hand in WN and TMS” (p. 74) sliding into the theme that Natural Philosophy “renders the theatre of nature more coherent” (Smith 1795: 41; 46) and that this link gives Aydinonat license to claim that Smith meant it to apply to moral philosophy and political economy. Smith’s discussions of the Newtonian system regarding the history of Astronomy, from which Emrah Aydininat claims he can draw a parallel with theories of social systems created “to sooth the imagination”, and thereby import the IH metaphor into modern economics, via TMS and WN, as “one capital fact, of the reality, of which we have daily experience”.  This is the shallow basis for Emrah Aydinonat’s speculations about the IH. They are Ingenious, but tenuous when set against the plain English language meanings of Smith’s writings.

Smith’s example of the pagan God, Jupiter, came from the Roman adulation of their stone statue of their God, set high on the Palatine Hill above the centre of Rome, within sight of its citizens, who believed credulously that he fired lightning bolts at enemies of Rome from his pointed finger.  Some Emperors even cast his image with their own on coins (Vivienza, G. 2008, “A note on Adam Smith’s first invisible hand”, The Adam Smith Review, iv, 26-29). Any theorising about Jupiter was well within the theological compass of pagan religion.  It had little to do with Newtonian philosophy and less to do with the “methodological background” to Smith’s moral philosophy and his “philosophy of science”.  How Jupiter’s supposed powers with lightning bolts ‘soothed the imagination’ of credulous pagans, cowering from contemplating Jupiter’s awesome powers and the instant threat they posed to anyone misbehaving with regard to Rome is not clear.  The image of Jupiter was more likely to intimidate the simple-minded persons who believed in him.  The purpose of shamans was to strike fear, not explanations, to secure social obedience from amidst ignorance on behalf of local strongmen (from which skills they acquired their own subsistence without the risks of the hunt or war).

When the young Adam Smith wrote this part of his essay and contemplated where his own argument took him, he knew that the contents would have caused him considerable personal trouble if his tutors found it. We know that when tutors searched his room and found him reading David Hume’ Treatise (according to McCulloch, 1823, 1863. Smith’s Wealth of Nations, Charles Black), they severely chastised him. In this role, his tutors acted as emissaries, like the 18^th-century equivalent of the Roman pagan priesthood, except they served modern revealed Christian religion. Hence, he kept his Essay for nearly three decades after leaving Oxford from the eyes of everybody, including, his close sceptical associates.

Emrah Aydinonat writes: “in the Theory of Moral Sentiments he invoked the ‘invisible hand’ when he tries to show how the selfish behaviours of the rich (in combination with natural forces) ‘advance the interests of the society, and afford means to the multiplication of the species’ (Smith 1790,IV.1.10).

It would be more accurate to say that he used the IH metaphor to “describe in a striking and more interesting manner” the “object” of the metaphor, that is a landlord acting solely from the inescapable motive of having to provide at least the very minimum of the subsistence of “the thousands he employed” – after all, the serfs, slaves and peasants had no other means of feeding themselves and their families, and without subsistence they could not labour - nor “afford the means to the multiplication of the species”. That is how Smith put the role of metaphors in his “Lectures on Rhetoric and Belles Lettres”, 1762, p 29), a wholly neglected Work of his, including by modern “experts” claiming to “know” the meaning of the IH metaphor; indeed, I have seen absolutely no evidence that any of them have read it or cited it in the modern literature, nor even consulted a dictionary on metaphors (see Oxford English Dictionary, 1983, p 674, vol. IX).  Their hidden motives led hem to actions that had unintended consequences. The “invisible hand” metaphor describes their motives that “led” them to act in the way they did.  Smith’s use was not a revelation of the existence of an actual “invisible hand”, a sort of entity, as in theological claims acting “miraculously” in an economy, to guide individuals to some correct, because designed, purpose (a “hand of God”, in stone or revealed in Christianity, or “Providence”).

In Smith’s examples of his use of the IH metaphor, we see his ascription of how the motives of individuals (that are invisible to others, though we may be able to deduce them from a knowledge of their circumstances) that led them to act (visibly!) and he also identifies the (visible!) “unintended consequences” of their actions from their motives. 

While I would describe Emrah Aydinonat’s, “The Invisible Hand in Economics” as a serious scholarly contribution, well crafted in the main, and an enlightening read, I feel at the end that he went down a misleading path, adding to the obfuscation of the interesting economics in the causes of “unintended consequences”.