Who Taught Paul Samuelson the Myth of the 'Invisible Hand' at the University of Chicago? The Most Likely Answer is Jacob Viner and/or Fellow Student George Stigler

Abstract

Gavin Kennedy has carefully shown that the “Invisible Hand” myth, that greedy and selfish private optimizing behavior leads to a social macro optimum that benefits all, had nothing to do with Adam Smith’s use of the invisible hand metaphor in The Wealth of Nations. Kennedy also showed that this myth, although correctly rejected by Paul Samuelson, was ascribed to Smith by Paul Samuelson in all of the editions of his Economics text book starting in 1948.

Samuelson most likely picked up this myth from either Jacob Viner, when he took Viner’s course, and/or fellow student George Stigler.

Keywords: Samuelson, Viner

JEL Classification: B10, B12, B14, B16, B20, B22