This book presents in the form of nine “essays” the “conclusions … reached so far” on an “invisible-hand project” that Warren Samuels began almost thirty years ago (pp. xiii–xiv). Sadly, we will never have from Professor Samuels anything other than this interim report, but that still leaves us with a deeply provocative work of great scholarship and mature reflection.

Professor Samuels’ canvass is vast, spanning not only Adam Smith’s use(s) of the “invisible hand” but also, and possibly of more importance to Samuels, the tendentious interpretation of the “hand” and of Smith’s work more generally by many subsequent economists, and the state of modern economics.

Samuels demonstrates that references to an “invisible hand” had been made for two millennia before Smith used the “term,” beginning with religious texts and later spreading to literature. As for Smith’s own usages in the Moral Sentiments (TMS) and Wealth of Nations (WN), Samuels argues that “Smith is silent on pretty much every aspect of the invisible hand” (p. 121), although it is claimed that rather more hints were given of the hand’s “function” than its “identity” (or ownership). Thus, it is suggested that the function in TMS may have been to promote a more equal “distribution of consumption,” whereas the function in WN was the promotion of the (unexplained) “public interest” (pp. 140–141, 81). Yet, in spite of the alleged “silence,” Samuels conjectures that “the identity and function of the invisible hand was extremely important to Smith” (p. 60); indeed:

I return to this suggestion below.

Turning to later treatments of the “hand,” Samuels distinguishes forty-eight interpretations of its identity and twelve major views of its function. Described as mere “assertions as to what Smith’s invisible hand was and did” (p. 140), and convincingly exposed by Samuels as impostors, the identities include the market or price-system, competition, self-interest, and the Walrasian auctioneer, and the functions include competitive equilibrium and the textbook favorite of Pareto-optimality.

But why should economists have bothered themselves with invoking “invisible hands”? Part of the answer, it seems, is that it is “a means of relating modern high theory to Adam Smith,” so helping the economics profession to achieve “eminence and celebrity,” if only by historical association (pp. xviii, 131). On a more sinister level, Samuels contends that “it is a piece of fiction that has served social control, psychic balm, and the entry and reinforcement of a political and economic ideology, as well as various material interests” (p. 140), the argument being (in short) that “invisible hand” references, and associated appeals to the authority of Adam Smith, are commonly used to promote “laissez faire” or “noninterventionism,” and to give an invincibly “scientific” aura to modern economic theory and the mainstream economics profession.

Samuels argues passionately and persuasively that there is, has been, and can be no such thing as undiluted “laissez faire” or “noninterventionism” to the extent that there must be some role for government in any real-world, modern human society. Actual societies also embody hierarchical power structures and institutional characteristics that constrain individuals’ opportunities in different ways. Clarion calls for “laissez faire” or “noninterventionism,” notably including those issued by Hayek, are, therefore, nothing more than disguised ideological statements: they are themselves calls for government to act in a particular way to the benefit of particular social groups (those who own the lion’s share of resources) and in support of particular social power structures and institutions. Moreover, although Smith and the “invisible hand” are often used to provide intellectual ballast for “laissez faire” propaganda, Smith did not himself advocate “minimalist” government, he did not seek to detract from “the role of institutions and other forces of social control,” and he did not deem “market solutions optimal per se” (p. 55). Rather, one might say, Smith has been enlisted in support of an end that was no part of his own intention.

He, and some version of the “invisible hand,” have also been enlisted in the creation of an economics discipline that brooks no dissent, lauds “absolutist formulations” of which the invisible hand is one (p. 137), engages in “social control and psychic balm” (p. 131), defines its “subject matter narrowly so as to minimise and render unobjectionable and unnamed most manifestations of power,” and has “disseminated and reinforced the doctrine of an invisible hand that augured such [an] ontologically given harmony … that a policy of so-called laissez-faire seemed inevitable” (pp. 204–205). To say that Samuels is critical of economics and the economics profession, and of the self-serving use (or abuse) of “invisible hand” stories, would be a considerable understatement.

Samuels’ study does indeed suggest that perhaps the main function of an “invisible hand” has been to provide the economics profession with a “mythopoeic” prop in its disguised ideological mission to dispense “psychic balm” and exercise social control. But beyond that ideological function, as Samuels states repeatedly, the “term” of the “invisible hand” is radically ambiguous, inconclusive, and empty; it adds nothing to knowledge, it conveys no substantive meaning, and it transmits only “pseudo-knowledge.” It could be “erased” without loss.

It almost goes without saying that Samuels’ pungent arguments are unlikely to receive universal assent by historians of economic thought, never mind members of the mainstream economics profession (were the latter ever to read the book). My own reservations include the following.

As to Smith’s use of the “invisible hand,” while I can agree with Samuels that there “is not much to go on with which to ascertain what Smith ‘really meant’” (p. 60), there are at least some things “to go on,” particularly in TMS. Indeed, Samuels must have shared a similar opinion; otherwise, he could not have claimed that Smith’s intention by using the “term” was “to soothe his own mind and the minds of his readers” (this idea of “soothing the mind” comes from Smith’s History of Astronomy). My own view is that Smith used the “invisible hand” and “Providence” in TMS as synonyms, thus suggesting an allusion to the design of a benevolent Deity whose aim was not merely a more equal “distribution of consumption,” as Samuel contends, but rather, and more importantly, a dispensation of “real happiness” (meaning the Stoic-influenced idea of “ease of body and peace of mind”) to even the lowliest ranks in society (whether Smith actually believed in this story is another matter, although I happen to think he did not).

The TMS may also provide a clue as to the meaning of “public interest” in the WN “invisible hand” passage. As Smith wrote in TMS, “the superior advantages the subjects of a well-governed state enjoy” are that “they are better lodged … they are better clothed … they are better fed” (TMS, IV.1.11); i.e., they come to enjoy the material conditions for “real happiness.” But this is precisely the end that is achieved (the “public interest”) by profit-seeking merchants, whose activities will generate the greatest possible demand for, and employment of, domestic labor, owing to a fortuitous correspondence between temporally sequential investment opportunities that yield the highest rate of profit and provide the greatest possible demand for domestic labor per unit of capital employed at any given point in time.

It seems to me that it is Smith’s “majoritarian” concern with the welfare of “the great mass of the people”—the laborers—and his understanding of welfare in terms of “real happiness” that open up the most unbridgeable differences with modern economics, for not only is it distinctly un-Smithian to proclaim the “optimality” of an economic system independently of the pattern of ownership and distribution (as Samuels rightly contends), it is also philosophically incoherent to associate Smith with the utilitarian assessment of “welfare” in terms of individuals’ subjective preferences.

I am also uneasy with the huge importance attributed by Samuels to “invisible hand” references and arguments in the work of “mainstream” economists. Of course, a flick through any number of modern economics textbooks will turn up grotesquely inaccurate and self-serving references to Adam Smith and the “invisible hand,” of which Samuels is, quite rightly, bitingly critical, but to go so far as to claim that the “invisible hand” is a “foundational concept” for economists (p. xv) seems eminently disputable. Is modern economics so unsure of itself that it must rely on a (distorted) version of its own history to provide its very foundations? Or are the occasional pseudo-historical references little more than decorative flourishes that could be discarded without serious loss? While it may be granted that immature or struggling “scientific” communities appear to derive solace from attempts to construct their own historical lineages, it seems to me that mainstream economics has long-since grown out of that stage.

Finally, on matters of style, this is not always an easy book to read, in parts giving the impression that the text has been barely transformed from working notes. I also found it difficult at times to distinguish between Samuels’ discussion of (interpretations of) Smith’s “invisible hand” and other usages. But to place my reservations in perspective, I have no hesitation in recommending a book that is, beyond doubt, a monumental work of scholarship.