On The Internet:
Although economists are interested in many cases of unintended consequences, those unintended consequences that involve businessmen seeking their own gain have been at the heart of economic analysis since Adam Smith. Smith noted that
"It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from their regard to their own interests. We address ourselves, not to their humanity but to their self love, and never talk to them of our necessities but of their advantages."
Since Smith, a great deal of intellectual effort has gone into exploring the question of under what conditions the interests of society will be served by businessmen seeking to make a profit--in fact, this is the core of microeconomics. The reading selections present background material to this exploration by explaining a large number of technical terms that economists use, and also by looking at a few of the simplifying assumptions they generally invoke.
After you complete this unit, you should be able to: