Theories Behind Sweatshop-Adam Smith's Invisible Hand, Self Interest
Theories behind sweatshop- Adam Smith’s perspective of Invisible Hand, Self Interest vis a vis Immanuel Kant’s theory on Ethics and Human Dignity
The above-mentioned aspects shall be explained by comparing two normative theories namely Adam Smith concept of an “Invisible Hand” qua Kant’s deontological theory on Ethics. Even though Kant’s philosophy has received criticism in multiple ways, his theory goes quite a distance to negate the conformists’ theory of demand and supply as suggested by various economists and capitalists.
From an economist’s perspective, the sweatshops may seem like an appropriate mechanism to boost the economy due its “laissez faire” approach towards thrusting on the concept of competition, supply and demand as suggested
by Adam Smith. As per Smith the “concept of an invisible hand exists” which means that if capitalism and free market existed, the people at the bottom whether it be a butcher, a labourer or a baker could reap maximised profits if they could meet the demands of the customers. The concept has won immense acclaim during the Great Depression, however realistically the concept of free trade and maximum competition has hitherto only resulted in the weakest class being deeply affected and the most suggestive example is a sweatshop prevailing in many countries. Another disturbing concept of the economically progressed countries emanates from the theory of “Self Interest” which refers to actions that elicit the most personal benefit which explains that the best economic benefit for all can usually be accomplished when individuals act in their own self-interest. His explanation of the invisible hand reveals that when dozens or even thousands act in their own self-interest, goods and services are created that benefit only consumers. The key principle of Kant’s imperative as opposed to Smith’s theory provides for “treating humanity whether in your own person or in that of another as an end and never as a means”.
The above-mentioned aspects shall be explained by comparing two normative theories namely Adam Smith concept of an “Invisible Hand” qua Kant’s deontological theory on Ethics. Even though Kant’s philosophy has received criticism in multiple ways, his theory goes quite a distance to negate the conformists’ theory of demand and supply as suggested by various economists and capitalists.
From an economist’s perspective, the sweatshops may seem like an appropriate mechanism to boost the economy due its “laissez faire” approach towards thrusting on the concept of competition, supply and demand as suggested
by Adam Smith. As per Smith the “concept of an invisible hand exists” which means that if capitalism and free market existed, the people at the bottom whether it be a butcher, a labourer or a baker could reap maximised profits if they could meet the demands of the customers. The concept has won immense acclaim during the Great Depression, however realistically the concept of free trade and maximum competition has hitherto only resulted in the weakest class being deeply affected and the most suggestive example is a sweatshop prevailing in many countries. Another disturbing concept of the economically progressed countries emanates from the theory of “Self Interest” which refers to actions that elicit the most personal benefit which explains that the best economic benefit for all can usually be accomplished when individuals act in their own self-interest. His explanation of the invisible hand reveals that when dozens or even thousands act in their own self-interest, goods and services are created that benefit only consumers. The key principle of Kant’s imperative as opposed to Smith’s theory provides for “treating humanity whether in your own person or in that of another as an end and never as a means”.