Abstract
Adam Smith’s is often falsely portrayed as having argued that radical selfishness is a force for the good and that this “invisible hand’ is his market mechanism. This paper argues that Smith’s real market mechanism, the sympathy manoeuvre, is a viable alternative to Schumpeterian and mainstream models of innovation in economics and also could help build a firmer theoretical basis for other approaches such as Responsible Innovation. To Smith all human activity was social and must be understood and explained in terms of the sentiments involved. Discovery, for instance, is driven by three sentiments (wonder, surprise, admiration), economic activities by sympathetic imagination, the need for exchange, the need to better one’s position in life, and the need for gratitude. Through sympathetic imagination, his famous model of the impartial spectator, Smith elegantly connects the individual and society. Smith’s innovation process is thus an exercise in social construction and not a destructive process based on radical selfishness. The paper argues that this social innovation process is a viable alternative to the extant approaches that are essentially asocial and amoral (economism) or ideologically normative (Responsible Innovation).
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Notes
Schumpeterian ideas are rarely taught as part of the economics curriculum and even in entrepreneurship two of his most important ideas are rigorously ignored: entrepreneurs are only entrepreneurs as long as they innovate; innovation is a combination of the existing, not something radically new.
Schumpeter was full of praise for Smith philosophy of science (1954: 182).
Smith, like all professors at the time, had to sign the Calvinist Westminster Confession before the Glasgow Presbytery and they probably took a dim view of his use of Thomist virtue ethics. Smith distanced himself from St Thomas Aquinas by referring to his philosophy as the work of “the schoolmen”.
The only notable exception is or was James Otteson, who argued in a paper (2000) that there is a reading of Smith’s two works that allows for the existence of an Adam Smith Problem, i.e. the inconsistent promotion of sympathy in TMS and selfishness in WN. However, Otteson in 2002 wrote a book in which he explained how he thinks the Adam Smith Problem can be resolved.
The destabilisation through selfishness is, to Smith, not a source of creation or innovation. In Smith’s social philosophy all individuals are constrained by society and innovation happens because of more co-operation, not by putting oneself outside society.
Schomberg (2013: 59) points out that his and the EU’s approach is at odds with virtue ethics. His first reason for rejecting virtue ethical considerations is quite telling: “it fails to show how various communities with competing concepts of the “good life”, within modern societies, could arrive at a consensus”. Virtue ethics knows no “one concept” of the good life, but in modern politics the politicians always want to be in control over the one concept that they push.
This contradiction is addressed (see for instance von Schomberg 2013), but has no consequences. When epistemology is in conflict with the goals of the research programme, RI, just like economism, ignores theory in favour of ideology.
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Hühn, M.P. Responsible Innovation: a Smithian Perspective. Philosophy of Management 17, 41–57 (2018). https://doi.org/10.1007/s40926-017-0057-y
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DOI: https://doi.org/10.1007/s40926-017-0057-y