Sandwichman — Is the “Invisible Hand” a lump of labor?

Summary:
Debunking the persistent wages-fund and lump of labor fallacies. Thirty years after Hoyt, Leopold Amery delivered a series of lectures in which he evaluated The Fallacies of Free Trade, paying particular attention to Smith's "terminological inexactitude." Smith's concept of capital viewed the capital of a nation as merely an aggregate of individual capitals. The difference, Amery explained, was that an individual's capital "is the result of saving, and grows by saving from profits or by credit based on profits" while the capital of a nation, "grows by the exercise of the qualities and energies of which it consists." In the jargon of systems dynamics, Smith mistook a stock for a flow. EconoSpeakIs the "Invisible Hand" a lump of labor?Sandwichman

Topics:
Mike Norman considers the following as important: Adam Smith, Lump of labor, wages-fund

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