Economic Lowdown Audio Series: Episode 3—The Role of Self-Interest and Competition in a Market Economy
Who described the opposing, but complementary forces of self-interest and competition as the invisible hand?
Adam Smith
What market force is the "regulator" of economic activity?
Competition
self-interest
Motivator of Economic activity. That which each firm, property owner, worker, and consumer believes is best for itself and seeks to obtain.
competition
Regulator of Economic activity.
What market force is the "motivator" of economic activity?
Self-interest
Why do some argue that a market economy requires little government regulation?
Self-interest is held in-check by competition.
According to the audio, what causes people to work or go to school?
They are self-interested.
Self-interest produces behavior that benefits others.
True
invisible hand
a term coined by Adam Smith to describe the self-regulating nature of the marketplace
market economy
economic system in which individuals own most of the resources and control their decisions on production and consumption of goods and services are based on voluntary exchange in markets. Government plays a small role.
