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Capitalism dictates that economic development is a result of personal self-interest and not
community interest. According to Adam Smith, the selfish desire to poses luxury goods drives
the economy (Smith, 2012). Selfishness drives people to acquire more wealth and, as a result,
grow the economy of the country. This paper gives the view of Adam Smith on self-interest and
relevance to the economy.
According to Smith, he reasoned that the market had the ability to self-regulate without
the interference of any one. In that, people’s greed and self-interest would be responsible for the
growth of the market. As mentioned above, his theories showed that it requires only self-interest
and greed to balance the economy (Smith, 2012). With an increase in greed and self-interest, the
economy of the country would grow adequately as the greedy individuals do. Smith did not need
an external intervention to balance the market. This is because the market itself is rational, and
thus, does not require any external regulation from the government. The market itself is capable
of performing its own balance mechanism (Smith, 2012).
Greed and self-interest are capable of causing harm to the economy of a country. They
require checks and balances from the government. This is because, without regulations, the
economy could be in the hands of few people. Without regulation on greed, many people could
suffer as the greedy could keep on taking and accumulating wealth as the kind get poorer than
they were before.
Adams perspective on greed and the economy is evident in today’s world. Presently the
rich get on getting richer while the poor get poorer. Still in the greedy peoples’ economy, the
economy grows despite the constant imbalance in the peoples’ wealth level.
Smith, A. (2012). The Wealth of Nations, Part 2. New York: Nabu Press.