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Thread: The Invisible Hand Relies Upon Visible Prices

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    The Invisible Hand Relies Upon Visible Prices

    The Invisible Hand Relies Upon Visible Prices is an argument for the value of prices in the market but it is also a good review of the fundamental ideas of the Austrian School of Economics.

    ...in a market grounded in rights to private property (not the least of which is the right to say “no”) the intention that drives each person to satisfy his or her own interest incites each person to satisfy also the interests of others – others whose interests he or she would otherwise do nothing, or at least do much less, to satisfy.

    ...Among our species’ greatest intellectual advances was to come to understand that an order is often not the result of the intent to organize – that is, not the result of any intent to bring about that order. Order instead is often emergent, or as F.A. Hayek was fond of saying, “spontaneous.” Order often emerges, undesigned, from the mutual and ongoing adjustments that each individual component of the order makes to the actions of each of the other components....

    ...Because the market order by its nature puts to productive use detailed knowledge that is widely dispersed, frequently fleeting, often only tacit, and far greater in quantity than any human being could ever hope to comprehend, it’s impossible to design any alternative method of economic organization that rivals the market order’s vastness and complexity....

    ...Just as the market order is essential to our survival, prices expressed in money are essential to the market order. Prices are among the visible results of the invisible hand’s successful operation, as well as the single most important source of this success.

    Each price objectively summarizes an inconceivably large number of details that must be taken account of if the economy is to perform even moderately well....
    Tradition is not the worship of ashes, but the preservation of fire. ― Gustav Mahler

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    RMNIXON (07-29-2021)

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    This also explains how hidden taxes and rapid inflation distort market forces.

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    carolina73 (07-29-2021),Chris (07-29-2021)

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    Quote Originally Posted by RMNIXON View Post
    This also explains how hidden taxes and rapid inflation distort market forces.
    Bingo! Price fixing disrupts the laws of demand and supply.
    Tradition is not the worship of ashes, but the preservation of fire. ― Gustav Mahler

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    carolina73 (07-29-2021),Newpublius (08-06-2021)

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    mark

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    luke
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    Quote Originally Posted by Chris View Post
    Bingo! Price fixing disrupts the laws of demand and supply.
    And what's happening right now is that the Fed is distorting the most basic price of all, the price of money and that's imbued in everything and it really is causing massive malinvestment.

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    Chris (08-06-2021)

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