Social interaction and economic outcomes - two types of social interaction
3 important questions on Social interaction and economic outcomes - two types of social interaction
What are two examples of social interaction?
The tragedy of the commons and the invisible hand
What is the invisible hand?
Under the right laws and economic institutions (private property, and competition among many economic actors), the economy would be guided, as if by an ‘invisible hand’ towards a socially beneficial outcome. -> Adam Smith
When thinking about problems and how to resolve these problems, what two things do we need to keep in mind?
1. Tragedy of commons
2. The invisible hand
2. The invisible hand
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