Unveiling Adam Smith’s Invisible Hands: Transcending Giorgio Agamben’s Economic Theology

Abstract

This article provides a critical evaluation of Giorgio Agamben’s argument that Adam Smith’s metaphor of the invisible hand is representative of economic theology and providential control. Although Agamben’s analysis does not explicate a nuanced view of the invisible hand, it does reveal the embedded economic theology in its misuse by neoliberal economists who characterise the invisible hand as a fundamental mechanism of market coordination consistent with a providential order. Conversely, this study argues that such perspectives fail to account for the intricacy and ambivalence inherent in Smith’s philosophy. Through textual analysis of the invisible hand in The Theory of Moral Sentiments, The Wealth of Nations, and The History of Astronomy, the manuscript highlights that Smith presents three distinct perspectives and that the theological interpretations do not adequately capture this divergence. Rather than endorsing a providential or theological framework, Smith’s use of the invisible hand is shown to be a conditional and intricate metaphor that serves as a critique, a form of social engagement, ethical commerce, and empirical analysis of irrational belief in markets that support the common good. Therefore, this interpretation transcends economic theology and reductive neoliberal economics, offering a more nuanced understanding with important implications for contemporary economics.

1. Introduction

The concept of the invisible hand in Adam Smith’s work has been the subject of extensive scholarly debate, leading to varied interpretations. Some neoliberal economists argue that it is a fundamental aspect of Smith’s theory of market coordination (Grampp 1948; Samuelson 1948; von Hayek 1960; Friedman 1962, 1970), whereas others consider it a peripheral or even satirical component within his broader philosophical framework (Rothschild 2001; Minowitz 1993; Otteson 2002). Hont (2005) takes a political perspective and argues that the invisible hand is part of Smith’s broader critique of mercantilism. Haakonssen (1981) and Fleischacker (2004) subscribe to an integrative view in which sympathy, alongside ethical constraints, functions as a regulatory mechanism that resists reducing human conduct to solely self-interest. A longstanding debate is whether the invisible hand is essentially informed by theology, as some scholars affirm (Winch 1978; Denis 2005; Evensky 2005; Cremaschi 2018). This theological position is frequently characterised as deistic, designating a non-interventionist deity that institutes autonomous, self-sustaining mechanisms and subsequently withdraws from continual engagement, a view similar to that of neoliberal economists. An analogous construct in political economy is the principle of self-interest, prefigured in the work of Bernard Mandeville and further systematised by Smith (Goudzwaard et al. 2007, pp. 31–45). A more subtle view held by Viner (1927, 1958) affirms the theological motives in Smith’s work but argues for a more qualified position, in which the invisible hand is a more systematic form of divine intervention. Alternatively, the theological and deistic positions are questioned by other scholars who adopt a rhetorical, philosophical, and non-religious perspective (Rothschild 2001; Otteson 2002; Fleischacker 2004; Kennedy 2010).

Giorgio Agamben aligns with the former group, interpreting the invisible hand as indicative of Smith’s endorsement of an economic theology within his broader critique of governmentality and biopolitics (Agamben 2011). Within this interpretation, Smith’s economic perspective is situated in a theological and governmental context in which market mechanisms assume a quasi-divine role, orchestrating the common good. Agamben (2011, pp. 283–84) notes that this mystical capacity is a providential machine that functions uninterrupted for the supposed good of society. What makes Agamben’s view of the invisible hand particularly interesting and important for contemporary society and economics is that he uses Smith’s presentation of the invisible hand as foundational for economic theology, the Trinity, and providential control, thereby critiquing biopolitics. This perspective effectively argues that Smith endorses market control, though numerous scholars reject it, arguing that he acknowledged the limitations inherent in market mechanisms. Rather, Smith identified factors such as corruption, monopolistic practices, governmental intervention, and unethical conduct as undermining the efficacy of the so-called invisible hand (Winch 1978; Kennedy 2009).

Gaël Giraud, in the article “Economics as Religion and Christianity as oikonomia: Giorgio Agamben and the Homo Sacer”, responds to Agamben’s presentation of Christianity, the Trinity and economic theology. His position is that this presentation reduces the Christian tradition in the West to a uniform phenomenon and that this is also not supported by economic data based on the equilibrium theory, amongst others. By implication, the reference of Agamben to Smith’s invisible hand is a similar reduction of Smith’s views. Agamben’s warning of the controlling influence of economic theology is rather a function of neoliberal economics and the misappropriation of Smith by economists such as von Hayek, Samuelson, and Friedman, among others. Giraud refers to these reductions of economics as market fundamentalism, which can be viewed as the foil of welfare economics. This type of misinterpretation is comprehensively confirmed by Kennedy’s (2009, pp. 239–63) textual analysis of Smith’s work and by Aksakal’s (2023) contemporary historical scholarship. Collectively, these academic perspectives enable a sophisticated understanding of the invisible hand, not as a definitive symbol of laissez-faire capitalism but rather as a contested and conditional metaphor within Smith’s moral philosophy. The invisible hand refers to the dynamic interplay among individual self-interest, moral sentiments, and institutional regulation. From a more favourable perspective, Agamben’s interpretation of the invisible hand correctly identifies its subsequent transformation into a generalised doctrinal principle within neoliberal thought. While Agamben may indeed over-emphasise the degree of theological coherence of the Western Christian tradition and Smith’s position, his critique should more appropriately be understood as targeting a broader economic theology immanent to modern market discourse, rather than being restricted to Western Christianity and Smith’s work alone.

Although Giraud’s argument exposes some reductionist tendencies in Agamben’s work and its implications for Smith’s invisible hand, it does not provide an alternative to market fundamentalism. Further, in Giraud’s discussion of market fundamentalism, references to the invisible hand in Smith’s work are not presented. From a Smithian perspective, the invisible hand remains caught between self-sustaining markets of economic theology and the hope of sympathetic–ethical markets (Fleischacker 2004, Kennedy 2010, Rasmussen 2006; Berry 1997). Smith’s perspectives are silent and inaccessible, offering no insight into contemporary society and economics, according to Giraud’s assessment. My argument is that the invisible hand is a more complex and nuanced metaphor, which endorses a more multifaceted view of economics. I will support this argument by embarking on a meticulous contextual analysis of the invisible hand in The Wealth of Nations [1779/1981] (WN), The Theory of Moral Sentiments [1759/2007] (TMS), and The History of Astronomy [1795] (written between 1744 and 1758). The novelty of this contextual analysis lies in its refusal to reduce the invisible hand to a single meaning and in providing essential implications for contemporary neoliberal economic theology. This analysis will reveal an intrinsic divergence of views that concurrently incorporates a critical perspective on structural corruption (WN), such as the proclivity towards hubris and avarice (e.g., mercantilism); a providential logic that is fragile and requires sympathetic sentiments for the common good (TMS); and polytheistic religion with irrational beliefs that is used as a psychological mechanism in the absence of empirical evidence (HA). Although this article focuses on the diverse invisible hands of Smith and the criticism of reductive readings, Agamben’s analysis of biopolitics and the influence of neoliberalism is essential to contemporary society and economics. From this perspective, Agamben’s account of an embedded economic theology is presented as symptomatic of neo-liberal, market-fundamentalist tendencies, insofar as it provides a justificatory framework for non-interventionist market regimes that support the common good. However, this invocation does not adequately reflect Smith’s more complex and heterogeneous conception of the invisible hand. In other words, it will be argued that Smith’s threefold invisible hands present positions that transcend the influence of neoliberal, market-fundamentalist economic theology in contemporary economics.

The discussion is structured in three sections: initially, Agamben’s economic theology referencing Smith’s invisible hand is elucidated; subsequently, the view that the invisible hand subscribes to neo-liberalism and market fundamentalism is refuted; and finally, a contextual analysis of Smith’s references to the invisible hand is presented to substantiate the argument that Smith adhered to a more nuanced understanding of the invisible hand, characterised by divergent interpretations.

2. Economic Theology and the Invisible Hand

In this section, Agamben’s argument that Smith’s invisible hand constitutes an economic theology is discussed with reference to his work The Kingdom and the Glory (2011). In this book, which is part of the Homo Sacer series, he undertakes an analytical exploration of the historical and theological foundations of governmental paradigms that also influence economics. He posits that the political and economic architectures of Western civilisation are profoundly entrenched in Christian theological doctrines, specifically the concepts of sovereignty, providence, and the Trinity. Agamben delineates between sovereignty, characterised as the transcendent governing authority akin to the Father within the Trinity, and government, analogous to the immanent management of affairs represented by the Son and the Holy Spirit. He also elucidates the notion of oikonomia, which originally denoted “household management” in Greek that was subsequently appropriated in theological discourse to signify God’s providential governance, illustrating how it underpins modern economic and governmental ideologies (Agamben 2011, pp. 122–23). Central to his thesis is the assertion that secular economic and governmental rationality, including market operations such as Smith’s “invisible hand,” retains the vestiges of a theological “providential machine” taken from The Theory of Moral Sentiments. This economic theology operates as though orchestrated by a divine blueprint, merging transcendent authority with immanent operational structure (Agamben 2011, pp. 283–84).

Agamben (2011, p. 122) begins his discussion by noting that modern science, including the classic economics of Smith, subscribes to the theological idea that the world is governed by a divine plan, e.g., “providential government”:

Modern science’s image of the world has often been opposed to the theological concept of a providential government of the world. However, in their conceptual structure, they are more similar than we customarily think. First, the model of general providence is based on eternal laws that are entirely analogous to those of modern science. But it is the relation between the first and second causes that presents evident analogies to modern science’s image of the world.

This is supported by Agamben’s argument that general providence and science are based on “eternal laws” in which the focus shifts from a preset initial plan to an “order produced by the contingent game of immanent effects” (Agamben 2011, p. 122). The focus of modern science is on “proximate causes,” which imply that the order of the world works like a womb rather than a brain. In effect, this means that there is a correlation between first and second causes, in which case there is no prescribed plan or general law governing the world but rather the correlation itself, its immanent effect, e.g., second causes (Agamben 2011, p. 123).

Agamben emphasises that Smith’s invisible hand is a connective between economics and providence. According to Agamben (2011, p. 278), the role of the providential order in Smith’s work must be understood in the context of the transformation of the meaning of oikonomia (Greek for management of a household) that disappeared from theological language in the Middle Ages and gained a more secular meaning referencing the government of the world. During the Enlightenment, the word reappeared in the Latin oeconomia signifying activities related to the “management and government of things and people” (Agamben 2011, p. 278). In other words, the meaning became a general reference to the order of nature and divine government, e.g., the “economics of nature”. This means that the divinely created order must be examined to comprehend the principles embedded in nature for the successful management and government of society and all things. It is also true that even evil deeds or catastrophic events will ultimately lead to the “general good”. Agamben (2011, p. 279) explains,

Oeconomia naturae simply means, in perfect accordance with the theological paradigm that is familiar to us, the wise and providential dispositio that the creator has impressed upon his creation and through which he governs it and leads it to its ends, in such a way that an apparent evil in reality agrees with the general good.

Consequently, nature contains an “immutable order of general laws” that correlate with second causes related to the immanent play of daily events that ultimately reveal the “intention and hand of a divine creator” (Agamben 2011, p. 279). The economy of the divine is embedded in creation, and science reveals this immanent order, which is the basis for the management and government of the world. Order is the signature of the incarnation of the divine order made immanent that requires a “science of order” to gain “knowledge of the economy” and the basis of the worldly social and natural order that constitutes the political economy (Agamben 2011, p. 282). Theologically, the meaning of oikonomia shifted from its use in classical Greek (management of the household) to a more administrative sense—arrangement or dispositio (Dean 2018, p. 205).

Smith’s invisible hand is, according to Agamben, representative of the “economy of nature” in which the first causes play out in the immanent realm in which self-interest has unintended consequences, that is, to the common good or the divine order. According to Agamben (2011, pp. 283–84), the metaphor is grounded in a theological framework that draws on biblical traditions, particularly as articulated in Augustine, who characterises divine governance as being exercised through “an occult hand sign” (Agamben 2011, p. 284), thereby emphasising its hidden, non-manifest modality. A comparable conception is found in Aquinas, who likewise refers to the operation of both the divine and governmental order as occurring without direct visibility. The economy of nature, therefore, is not the rationalism of the brain but the immanent play of the stomach. For this reason, the desires, passions, and motivations that Smith bases his moral theory and economics on are reflective of the providential and transcendent order that is immanent in natural law. Agamben (2011, p. 284) concludes,

If it is probable that the Smithian image of the invisible hand is to be understood, in this sense, as the action of an immanent principle, our reconstruction of the bipolar machine of the theological oikonornia has shown that there is no conflict between “providentialism” and “naturalism” within it, because the machine functions precisely by correlating a transcendent principle with an immanent order. Just as with the Kingdom and the Government, the intradivine trinity and the economic trinity, so the “brain’’ and the “stomach” are nothing but two sides of the same apparatus, of the same oikonomia, within which one of the two poles can, at each turn, dominate the other.

His argument is that Smith’s classic economics can be traced back to the theological meaning of oikonomia and the divine government of the world. This concept focuses on the immanent representation of the divine order in nature and the management of society and creation according to divine economics. The discipline of economics investigates the second causes to appreciate the divine plan and the invisible hand. Agamben’s views imply that Smithian economics serves governmentality and biopolitics, meaning that free-market economics is essentially the enactment of sovereign power across all spheres of society, influenced by neoliberalism. In economics, the invisible hand (though Smith’s references were far more nuanced) has been transformed by influential economists into a theological justification for non-interventionist, laissez-faire economic policies. This, as it is today, is expressed in market control of bare life, or market fundamentalism, according to Giraud (2023, pp. 3–4).

In the next section, Giraud’s criticism of Agamben’s reductive references to Christianity in the West and market fundamentalism is discussed.

3. The Invisible Hand and Market Fundamentalism

In this section, Giraud’s opposition to Agamben’s (2011, pp. 3–12) view of the invisible hand as representative of the providential machine is critically discussed in the context of Agamben’s biopolitics and government control. This is followed by a reference to empirical evidence from the General Equilibrium Theory (GET) that disproves the concept of market equilibrium. Finally, Giraud presents the patristic tradition as proof that Agamben’s oikonomia is reductive and reflects only one aspect of it.

Giraud (2023, pp. 3–4) notes that Agamben’s references to Smith’s invisible hand are made in the context of his political theory that deals with life and power in the book Homo Sacer: Sovereign Power and Bare Life (1998). This biopolitics of the sovereign state and power draws a distinction between ζωή (bare life) and βίoς (politically qualified life) to exert control over citizens’ bare life (Agamben 1998). Biopolitics posits that the state exerts control over individuals through legal frameworks, disciplinary measures, and the regulation of life processes, thereby representing the intersection of biological and political domains. In contemporary democracies, this control can even exclude people from political life through the “exception” (Giraud 2023, p. 3). This expands to the threat of banning and killing violence based on the homo sacer (a bandit that may not be sacrificed but murdered, a view opposed by the Cain narrative) (Giraud 2023, p. 4). The state’s legitimacy to do this, according to Giraud (2023, pp. 5–7), is founded on ontological dualism, which separates sovereignty and government, in which power is delegated by the transcendent father to the government. Like the Trinity, where the Father is transcendent, and the Son is immanent and endowed with divine power to govern (macchina governamentale). Government is endowed to control the oikonomia, an “economic-management model”, and the Holy Spirit, reinforcing the glory of the Father.

Giraud (2023, p. 7) infers that “the Father ‘who reigns, but does not govern’ already prefigures Smith’s ‘invisible hand’, according to a providential disposition that owes its essence to the patristics”. Therefore, Giraud notes by citing Agamben: “Trinitarian economy is rather a ‘paradigm’, whose aim was to make intelligible a series of phenomena whose kinship had eluded or could elude the historian’s gaze”. The power of sovereignty is rooted in the supposed Trinitarian basis of an automated economic theology, which Giraud (2023, pp. 1–7) refers to as “market fundamentalism”.

An aspect that Giraud does not mention but is informative for understanding Agamben’s argument is that state power operates through glory and inoperativity. For Agamben (2017, p. 591), glory is the basis for divine inoperativity of the providential machine:

The indescribable mystery that glory, which is blinding light, must hide from the gaze of the scrutatores maiestatis is that of divine inoperativity, of what God does before creating the world and after the providential government of the world is complete. It is not the kabhod, which cannot be thought or looked upon, but the inoperative majesty that it veils with its clouds and the splendor of its insignia.

In other words, glory conceals divine inoperativity and at the same time the inoperativity of life in the providential machine, which Agamben (2017, pp. 591–92) explains is the foundation of power:

Glory, both in theology and in politics, is precisely what takes the place of that unthinkable emptiness that amounts to the inoperativity of power. And yet, precisely this unsayable vacuity is what nourishes and feeds power (or, rather, what the machine of power transforms into nourishment). That means that the center of the governmental apparatus, the threshold at which Kingdom and Government ceaselessly communicate and ceaselessly distinguish themselves from one another is, in reality, empty; it is only the Sabbath and katapausis—and nevertheless, this inoperativity is so essential for the machine that it must at all costs be adopted and maintained at its center in the form of glory.

Inoperativity of the providential machine makes it possible that life can be controlled and directed through governmental mechanisms that manage bare life (Rathbone 2025, pp. 80–85). This is evident in the view of market fundamentalism, as the market’s mysterious workings obscure the control exerted through capitalism, where some benefit from market dynamics while others are exploited. The argument that markets should be left to the forces of supply and demand to reach equilibrium in the interest of the common good is a case in point. Dickinson (2022, p. 8) comments that Agamben’s argument is that the providential order that is embedded in neo-liberal economic theory of market efficiency is a “political-theological configuration of the economy which hinges upon an exclusionary inclusion (or inclusionary exclusion) …” This dualism between what is present and hidden in the representations of modern economics and theology is unveiled in Agamben’s “genealogy of Western notions of economy” and its influence on humanity and society (Dickinson 2022, pp. 8–9).

The market-fundamentalist position is articulated by neoliberal scholars such as von Hayek (1960) and, subsequently, Friedman (1962), who elevated the notion of the invisible hand to a central principle underpinning market efficiency—although scholars also contend that Polanyi was the first to apply this concept (Bladel 2005). Friedman observed that “the possibility of co-ordination through the price system was the most important insight in Adam Smith’s Wealth of Nations” (Friedman 1962, p. 13). Furthermore, von Hayek conceptualised the invisible hand as a “spontaneous order,” suggesting that an appropriate social and economic order emerges without deliberate design. By contrast, Otteson (2002, 2007) preferred the term “unintended order,” thereby emphasising an evolutionary, rather than purely spontaneous, understanding of social and market coordination.

Alternatively, for Giraud (2023, p. 8), the invisible hand, which assumes market efficiency, is no longer accepted by modern economists. Rather, the opposite is true: markets are generally inefficient. Giraud (2023, p. 13) points out that “mainstream economics (namely general equilibrium theory) acknowledges that the invisible hand is a myth: whenever they exist, Walrasian equilibria in decentralised markets are almost never Pareto-efficient”. The reason is that empirical evidence shows that Walrasian equilibrium in General Equilibrium Theory (GET) is not Pareto optimal (i.e., Pareto efficient). Giraud (2023, p. 9) underscores that from the 1980s, “…. it has been clearly demonstrated, within GET, that Walrasian equilibria are almost never Pareto-optimal; when they are, it is only by accident”. Pareto optimality describes a situation where one person’s situation improves without making anyone else worse off; in other words, there is no free improvement. Any progress necessarily means that someone will be worse off.

Pareto efficiency, therefore, in most cases of equilibrium, does not enhance optimality for everyone, e.g., some people may be extremely wealthy while others are starving. Market equilibrium is designated as efficient under a restrictive technical framework known as Pareto efficiency. This classification is limited in scope and does not ensure outcomes such as fairness, equality, or social welfare. Consequently, scholars contend that the concept of Pareto efficiency may compromise or refute the intrinsic value of market equilibrium. Efficient markets led by the invisible hand do not imply that everyone is doing well or that it is optimal for society. This situation is represented by the Pareto curve, used in welfare economics, which plots individual well-being with points indicating where no one can be better off without making someone else worse off. In other words, the logic of market fundamentalism assumes that the pursuit of self-interest can lead to the common good, which disproves Agamben’s argument that the invisible hand is a providential machine. This is, however, a qualified assertion because a distinction must be made between Agamben’s criticism of biopolitics that is appropriated by neoliberal economists and Smith’s nuanced views. In other words, although Agamben presents a reductive view of Smith’s invisible hand, his analysis of the control over bare life by neoliberal-influenced market fundamentalism is accurate. Consequently, Giraud argues that economic data cast doubt on the idea that non-interventionist market dynamics promote market efficiency and the common good.

John Maynard Keynes was one of the first major twentieth-century economists to challenge the efficient market hypothesis, which is based on the concept of the invisible hand. He notes that “classical theory happens not to be those of the economic society in which we actually live, with the result that its teaching is misleading and disastrous if we attempt to apply it to the facts of experience” (Keynes 1976, p. 3). In other words, it is not self-interest that guides people to unintended consequences that support the common good through market efficiency. Rather, what influences people are animal spirits that he describes as “a spontaneous urge to action rather than inaction, and not as the outcome of a weighted average of quantitative benefits multiplied by quantitative probabilities” (Keynes 1976, p. 161). Economic theology conceals the market’s fragility, which can also be manipulated for personal gain.

Finally, Giraud points to the patristic tradition and the meaning of oikonomia. Agamben notes that in this tradition, oikonomia refers to an “immanent, domestic and providential management” that is one-sided. Gregory of Nazianzus, although he based oikonomia on the Trinity, had a distinct pneumatological focus (Giraud 2023, p. 11). While Gregory of Nyssa draws a distinction between two types of oikonomia: material desires, which are limited by saturation, and God’s desire, which is limitless. This makes an interesting case for neo-liberal economics and the idea of “infinite growth”. Giraud (2023, p. 11) notes that the problem is that Agamben transposes one meaning onto the other without making clear how this took place, while Gregory of Nyssa makes a distinction between the two. The complex view of oikonomia is further demonstrated in the conflict between Gregory of Nazianzus and Basil of Caesarea, where oikonomia governs the sharing of goods according to each person’s needs and accepts incompatibility. Gregory of Nazianzus sought to preserve the doctrine of the Trinity, while Basil of Caesarea, from the perspective of oikonomia, argues for the preservation of the unity of the ecclesia (Giraud 2023, p. 12). In other words, Giraud underscores the presence of reductive reasoning in Agamben’s reference to the patristic tradition as a homogenous tradition that cannot be equated with contemporary economics.

Although Giraud effectively articulates his critique of Agamben’s reductive tendencies—which resemble, in many respects, the misappropriation of the notion of the “invisible hand” by neoliberal economists because of its systematic misuse—his analysis remains limited. The principal shortcoming lies in his failure to offer an alternative interpretive framework between, on the one hand, market fundamentalism and, on the other, welfare economics for understanding the meaning and function of Smith’s invisible hand and its implications for contemporary economic thought.

The central problem with Giraud’s assessment is that, in his treatment of market fundamentalism, he does not engage with Smith’s actual textual references to the invisible hand. This constitutes a substantial omission, as it both constrains an adequate representation of Smith’s own views and impedes the development of practically applicable insights for contemporary society and economic policy.

The following section, therefore, provides a contextual analysis of the invisible hand in Smith’s works, with the aim of shedding light on these issues.

4. Adam Smith’s Invisible Hands

In Smith’s corpus of work, the reference to the invisible hand only occurs three times in The Theory of Moral Sentiments (Smith [1759] 1981) (TMS), An Inquiry into the Nature and Causes of the Wealth of Nations (Smith [1776] 2007) (WN) and History of Astronomy (1795) (HA), leading some scholars to suggest that the invisible hand is not a major aspect of Smith’s work (Tobin 1992; Schneider 1979). Nonetheless, it is only in the twentieth century that the metaphor attained conceptual salience in the analysis of free market dynamics. Although it was criticised by Keynes and other economists, an ideologically driven neoliberal resurgence, influenced by figures such as Friedman (1962), subsequently emerged. Drawing on The Wealth of Nations, Friedman, among others, emphasises that “Adam Smith’s doctrine of the invisible hand illustrates how individuals in a free market, seeking personal gain, often promote the public interest more effectively than when they intend to promote it” (Friedman 1970, p. 33).

In this section, Smith’s three references to the invisible hand will be analysed in context to underscore their divergent meanings and implications for economics today.

4.1. Invisible Hand and the Wealth of Nations

Smith’s (WN IV.ii.9) reference to the invisible hand in WN is as follows:

But the annual revenue of every society is always precisely equal to the exchangeable value of the whole annual produce of its industry, or rather is precisely the same thing with that exchangeable value. As every individual, therefore, endeavours as much as he can both to employ his capital in the support of domestic industry, and so to direct that industry that its produce may be of the greatest value; every individual necessarily labours to render the annual revenue of the society as great as he can. He generally, indeed, neither intends to promote the public interest, nor knows how much he is promoting it. By preferring the support of domestic to that of foreign industry, he intends only his own security; and by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention. Nor is it always the worse for the society that it was no part of it. By pursuing his own interest, he frequently promotes that of the society more effectually than when he really intends to promote it. (Italics inserted by the author of the article.)

Smith notes that the “annual revenue” of a society is “equal to the exchangeable value of the whole annual produce of its industry”. People, therefore, employ capital to “support domestic industry” to create exchange value, which is equal to the “annual revenue of society”. Smith concludes that the promotion of public interest is unintentional. However, he qualifies this statement by adding that his conclusion is based on the person’s preference for supporting domestic rather than foreign industry. According to Smith, the support of domestic industry is based on a person’s need for security to further their own gain. Therefore, promoting an end that is not part of a person’s intention is like the person being led by an invisible hand. Pursuing one’s own interests consequently advances society’s interests more effectively.

This interpretation is the basis of the market fundamentalist position, which links self-interest and the invisible hand to the common good of society (Samuelson 1948; Friedman 1962; Stigler 1976). Stigler notes that self-interested decision-making for profit produces efficient resource allocation, e.g., market equilibrium. Samuelson (1948) argues that market-directed activities directly affect social welfare, while Friedman (1962) focuses on individual economic freedom rather than planned progress.

However, von Hayek (1960) and Otteson (2007) reference the invisible hand differently from Smith’s reference to “without intending” or “knowing it”. In other words, the invisible hand is a force that influences outcomes and knowledge beyond an individual’s awareness. This implies that a person’s rational, emotional or connotative capacities were not the cause of action. These references of Smith make it clear that intending and knowing refer to methodological and epistemological aspects of human action. In other words, I do things in a particular way to reach intended outcomes, or I have no means of knowledge to reach outcomes.

Otherwise, a close reading of the text highlights the political and historical context, the policy implications, and Smith’s disapproval of imperialism and mercantilism (Muthu 2008). It is essential to note that the chapter primarily focuses on restrictions on importation from other nations aimed at protecting the domestic economy. Smith condemns tariffs and other policy interventions because they only benefit a few and limit free trade. Reference to the invisible hand is more a matter of criticism of mercantilism than market fundamentalism. The preference for domestic trade can also be argued as self-interested while simultaneously supporting the common good without policy interference. The favour of domestic support is intentional, as security often lies in the proximity of familiar social relationships. The backing of others in society is intentional, driven by exchange relationships. Support for local industry maintains employment and fosters long-term trust, thereby benefiting both parties. By implication, self-interest often plays a role in the mutual relationships with others. Therefore, it is not exclusive self-interest but rather an awareness of social connectivity and interdependence.

Skinner (1976, pp. 54–55) and Hont (2005, pp. 354–88) support this position from textual-historical analysis of the WN. Hont argues that the invisible hand is a criticism of mercantilism that does not require state involvement to promote domestic trade. Skinner (1976) viewed it as more of a commercial sociability in which self-interest has a social benefit, therefore stating that “Smith’s conception of ‘economic man’ was primarily a product of his moral philosophy. While defending the motive of self-interest against Hutcheson’s claim that it could never be virtuous, he emphasised that self-interested actions take place within a social setting and that humanity is generally motivated by a desire for approbation” (Skinner 1976, p. 1). Skinner notes that Smith disagrees with this assessment of Hutcheson, arguing that self-interest benefits both the individual and society. Rather than accentuating strategic greed, it emphasises mutual relationality and responsibility. In other words, the invisible hand in WN is presented as a critique of mercantilism (Hont 2005) and imperialism by advocating a view of self-interest that is deliberately in the common good, therefore supporting an ethical disposition that is focused on the common good and responsible commerce.

4.2. Invisible Hand and the Theory of Moral Sentiments

The reference to the invisible hand differs from WN because the focus shifts to the socio-economic and moral domain:

The rich only select from the heap what is most precious and agreeable. They consume little more than the poor; and in spite of their natural selfishness and rapacity, though they mean only their own conveniency, … they divide with the poor the produce of all their improvements. They are led by an invisible hand to make nearly the same distribution of the necessaries of life which would have been made had the earth been divided into equal portions among all its inhabitants; and thus, without intending it, without knowing it, advance the interest of the society, and afford means to the multiplication of the species (TMS IV.1.10) (italics inserted by the author of the article).

The reference focuses on consumption and the difference between the rich and the poor. The traditional Smithian argument is that the consumption of the rich and poor is the “same distribution of the necessaries of life” if everything is divided equally. This equal distribution of all the “improvements” made by the rich unintentionally advances society’s interests through the invisible hand. Smith’s argument for the invisible hand is framed by his discussion of systems, such as commerce, that support social harmony and the common good through providence. An aspect that the poor man’s son in the preceding section (TMS IV.1.8) is not aware of when his ambition leads him to follow a life of wealth accumulation that ends in despondence. In contrast, his activities likely provided resources and happiness for others, even in circumstances where the system is not moral. Smith (TMS IV.1.10) claims that providence is responsible for the division of wealth among the classes.

When Providence divided the earth among a few lordly masters, it neither forgot nor abandoned those who seemed to have been left out in the partition. These last too enjoy their share of all that it produces. In what constitutes the real happiness of human life, they are in no respect inferior to those who would seem so much above them. In ease of body and peace of mind, all the different ranks of life are nearly upon a level, and the beggar, who suns himself by the side of the highway, possesses that security which kings are fighting for.

This is an important theoretical underpinning for the invisible hand because it assumes natural order and protective or ethical presuppositions in life. As a result, Smith explicitly states that the rich and the poor are functions of the distribution of goods; the care for each group is part of ethical distribution. This is the basis of the happiness of life because the poor are not “inferior to those who would seem so much above them”. Smith refers to the categories on which he bases this assumption as “ease of body and mind”. The former may refer to the comfort of the body that is relative to what a person is accustomed to and the mental stress and anxiety that material wealth can bring. Smith does qualify that equality may not be completely but “nearly upon a level”. Smith explains this with the example of a beggar who has few worries in the world and is content with very few material goods, as well as the anxiety that accompanies them. The necessities are enough for tranquillity and happiness.

Consequently, the invisible hand is at work balancing people’s needs. Smith (TMS, VII.ii.1.20) writes that an individual must possess confidence in the overarching wisdom that orchestrates the various events of human existence. This confidence enables the individual to embrace any circumstances with contentment, grounded in the conviction that, if one were privy to the intricate interconnections and dependencies within the universe, the resultant circumstances would align with their own desires. Thus, engaging with the profound intellect inherent in human nature serves as a mechanism for reconciling with the inevitability of mortality within the providential system, which is inherently deistic.

The providential view of the invisible hand as an unintentional order is supported by many scholars, who note that self-interest operates within a moral cosmos guided by sympathy and justice (Hanley 2008), by natural theology or divine providence (Hill 2001), or by providential design (Viner 1958). As Hill (2001, p. 29) notes, “Contrary to late readings of Smith’s ‘invisible hand’ as an essentially secular device, it is argued that Smith’s social and economic philosophy is inherently theological and that his entire model of social order is logically dependent on the notion of God’s action in nature”. According to Hanley (2008, pp. 100–31), Smith did not envision that self-interest inevitably leads to good commercial conduct that supports the common good.

The significance of providence, according to Smith, lies in the self-discipline and prudence it cultivates within an individual. Smith posits that the scenarios demanding full mastery over the expression of passions and opinions, potentially to the point of complete dissimulation (TMS, VI.iii.12), serve as the paramount school of self-command, challenging a person. These challenges offer opportunities to cultivate moral integrity. Such situations, which function as the primary means for developing this virtue, encompass the sustained endurance of adversity; exposure to dangers, injuries, and misfortunes; and confrontation with factional strife and the various difficulties and risks intrinsic to warfare (TMS, III.3.24, III.3.36, VI.3.27) (Bee and Paganelli 2019, p. 576). In essence, the acknowledgement and understanding of the inevitability of events are fundamental. Smith (TMS, VII.ii.1.35) further elucidates that such an understanding renders the concept of death tolerable, as it involves “contempt of life and death, however, and, at the same time, the most complete submission to the order of Providence; the most complete contentment with every event which the current of human affairs could possibly cast up.” Furthermore, in the event of all other measures failing, a natural remedy exists:

Should those passions be, what they are very apt to be, too vehement, Nature has provided a proper remedy and correction. The real or even the imaginary presence of the impartial spectator, the authority of the man (sic) within the breast, is always at hand to overawe them into the proper tone and temper of moderation (TMS, VII.ii.1.44).

Based on these two references, an alternative interpretation of the invisible hand can be derived that challenges market fundamentalism and instead advances a more differentiated understanding of societal interdependencies and the functioning of complex socio-economic systems. The impartial spectator is therefore the ethical-reflective ability of people to function in a world where systems are fragile and invisible hands fail. Smith, rather, admitted that the orderly system of care can be undermined by the injustices of corruption, monopolies, government interventions, and unethical conduct, as referred to in WN. Corruption undermines people’s freedom and access to the means of happiness. In the case of the poor man’s son, the beauty of utility is undermined when tools break down, which undermines systems and moral good.

The reference to the invisible hand in the context of TMS, which concerns the beauty of utility and the narrative of the poor man’s son, differs from that in WN. In WN, the invisible hand is linked to criticism of corruption and moral decision-making, while TMS underscores a cosmos that appears inherently good or providential, one that, under normal circumstances, supports the common good, even when some are overly ambitious and even greedy. This providential, benevolent cosmos is, however, not all it is made out to be because people are influenced by their passions that can interrupt supposed goodness. People are seduced by wealth, fame and fortune. Conversely, people are also motivated by sympathetic sentiments that support others’ well-being (Rathbone 2026, pp. 1–3). In a perceived mechanical cosmos, nature provides an alternative to the uninterrupted, automatic, benevolent producing system.

Scholars have suggested a wide range of interpretations of the invisible hand in TMS that also undermine the presence of an automated, stable system. Rothschild (1994, pp. 319–22) views the invisible hand as an ironic joke, and Kennedy (2009, pp. 239–63) argues that it is a mythologised metaphor. Kennedy (2009) notes that the invisible hand was not a central concept in Smith’s writing, which he was not inclined to develop as a theoretical concept. Conversely, Kennedy points out that it was rather a twentieth-century invention of neoliberal economists, like Agamben’s economic theology. Kennedy (2009, p. 259) writes:

But modern economists took an isolated metaphor, used rarely by Adam Smith, and, in his name, invented a wholly misleading belief about how commercial markets function and how people in them necessarily and unintentionally work for public benefit, independent of the consequences of their actions.

According to Kennedy, the invisible hand was used as a self-contradictory concept in economics to clarify market dynamics, but, conversely, it offers no explanatory value comparable to that of economics as a science, even as Smith envisioned it. What it did, rather, was to bewilder everything to which it was applied.

Consequently, Rothschild (1994, p. 319) views Smith’s use of the invisible hand as an “ironic but useful joke” like its use in HA (discussed in the next section). She states that the metaphor in TMS was used in a sardonic sense in which Smith describes some particularly unpleasant rich proprietors, who are quite unconcerned with “humanity” or “justice” but who, in “their natural selfishness and rapacity” pursue only “their own vain and insatiable desires”, although they do, however, employ thousands of poor workers to produce luxury commodities.

Similarly, in WN, the metaphor is therefore a sarcastic criticism of domestic monopolies of merchants: “Domestic monopolies, he says, are advantageous for specific industries; but if there were no import restrictions, the merchant would still prefer to support domestic industry, in the interest of ‘his own security.” (Rothschild 1994, p. 319). She also notes that the invisible hand is a reference to superstition, to criticism of philosophers such as Socrates, and to the notion of providence. Smith, like David Hume, employs the term primarily to designate the objects of superstition or the as-yet-unexplained components of scientific systems. On several occasions, he associates the notion of the invisible with pagan forms of religion and censures Socrates for his purported clandestine interactions with “some invisible and divine Being.

Further, Smith’s passion for human freedom and independence is diametrically opposed to the invisible hand, which implies that a mystical being is usurping this freedom. Rothschild (1994, p. 319) notes that it is this “independence and idiosyncrasy of individuals” that Smith seems to be denying in his account of the invisible hand; it is in this sense a thoroughly un-Smithian idea. The integrative view of Fleischacker (2004) and Griswold (1999) expands on previous perspectives (Hanley 2016) of an unintended social order based on a moral-anthropological understanding of imperfect virtue. In both WN and TMS, Smith’s use is context-specific, with different meanings.

Consequently, Agamben’s reference to the invisible hand in TMS as a source for economic theology is a clear departure from Smith’s argument and contemporary scholarly consensus. It is, rather, a misappropriation by neoliberal economists, as Kennedy (2009, p. 239) confirms. In other words, Agamben correctly argued that it is part of Smith’s theory of nature and cosmological ordering, associated with Stoicism (a perspective followed by market fundamentalists), but without considering the important role Smith ascribed to sympathetic sentiments. The invisible hand points to the fragility of systems such as the market. In other words, social and economic systems do not operate autonomously to achieve optimal outcomes for all members of society or to ensure equitable resource distribution. Smith contends that such automatic alignment does not occur and that sympathy, guided by the impartial spectator’s perspective, is required to regulate individual conduct in accordance with ethical norms. Smith’s concept of the invisible hand is thus embedded within a moral framework, thereby creating the conditions for ethical commercial activity, insofar as a pure mechanical system is inherently fragile and depends on individuals’ sympathetic sentiments for the sustained flourishing of society. In other words, the idea of a providential, benevolent cosmic order is undermined by fragility, failure and chaos. Sympathetic moral sentiment and the impartial spectator are the foils that sustain social harmony.

4.3. Invisible Hand and the History of Astronomy

In the earliest reference to the invisible hand in The History of Astronomy (1795) (written between 1744 and 1758), Smith (1795) focuses on a theological perspective, but instead of providential and deistic, it emphasises the unique involvement of polytheistic gods in the world.

For it may be observed that, in all Polytheistic religions, among savages, as well as in the early ages of Heathen antiquity, it is the irregular events of nature only that are ascribed to the agency and power of their gods. Fire burns, and water refreshes; heavy bodies descend, and lighter substances fly upwards, by the necessity of their own nature; nor was the invisible hand of Jupiter ever apprehended to be employed in those matters.” (italics inserted by the author of the article).

Rothschild (1994, pp. 319–22) interprets this reference as a metaphor for superstitious belief, whereas Viner (1958, p. 55) argues that it reflects a natural theological, providential worldview. According to Viner, the metaphor thus anticipates Smith’s conviction in a moral and religious order underlying human affairs. The metaphor of “the invisible hand of Jupiter” embodies the human intuition that the world is governed by unseen forces. Although such intuition is misdirected in pagan superstition and used as a psychological mechanism to deal with inexplicable events, it nonetheless points to Smith’s awareness of the concept in his earlier work and to its popular association with the involvement of divine beings in human affairs.

Winch (1978, 1996) observes that Smith’s invocation of “the invisible hand of Jupiter” is situated within his anthropology of wonder, which elucidates how humans utilise divine explanations to account for irregular phenomena. This is not intended as a theological endorsement but rather as a component of his exploration into the genesis of philosophical thought. The metaphor illustrates Smith’s naturalistic interpretation of religious phenomena, positing that religion arises from human emotions such as wonder and fear in response to irregularities encountered in nature. Subsequently, the concept of the “invisible hand” in his work is better understood within a sociological and psychological context, rather than a theological one.

Similarly, Hanley (2016) articulates that the metaphor of the invisible hand in HA prefigures Smith’s enduring engagement with the evolutionary trajectory from superstition to philosophy, specifically, the transition from belief in divine irregularity to the acknowledgement of natural order. The HA metaphor encapsulates the human endeavour to discern order amidst apparent chaos. Originating in superstition, this quest evolves within Smith’s TMS and WN into a moral and economic form of providence that is unstable and fragile. Hanley, therefore, identifies a conceptual continuity between HA and Smith’s subsequent intellectual developments, despite the metaphor’s referent shifting from the deity Jupiter to a natural or moral order.

Scholarly consensus generally interprets the invisible hand in HA as reflecting Smith’s recognition that superstitious or erroneous beliefs function as psychological mechanisms through which individuals seek to explain meteorological and even cosmological phenomena. Equally, market fundamentalism and the belief in economic theology can be viewed as a modern superstition in the efficiency of markets, even if the opposite is evident. Nevertheless, this superstition is an irrational psychological crutch to deal with the reality of the market’s inefficiency, which mostly fails to serve the common good or a benevolent cosmic order.

5. The Invisible Hands of Adam Smith

Upon conducting an inverse-chronological analysis of references to the invisible hand in Smith’s seminal works, WN, TMS and HA, a more nuanced interpretation emerges. WN presents his political economy and critiques mercantilism, which Skinner and Hont expand upon, underscoring its socio-political dimension. This development represents a shift toward a more rationalistic and humanistic conception of self-interest, emerging from the fragile providentially oriented framework in TMS to which Hanley, Hill, and other commentators are committed. The divine involved view of the invisible hand arises from the distinctly polytheistic view in HA, which Winch notes exemplifies a critique of superstitious religious beliefs as a psychological mechanism for explaining incomprehensible events. Alternatively, Agamben’s (2011, p. 283) providential machine is a blend of Trinitarian theology and providence that combines views from TMS and WN. Quoting WN, he states that there is “no doubt” that the invisible has “biblical origins” (Agamben 2011, p. 283), citing providence, the Trinity, and oikonomia.

The assessment of the invisible hand in Smith’s work reveals a full understanding of its complexity and possible implications. Further, Agamben’s economic theology is important because it underscores the role of the invisible hand in providential and theological interpretations by neoliberal economists and market fundamentalists. In other words, neoliberal economists such as Hayek, Samuelson, and Friedman align with the market fundamentalist position, which champions self-interest and the market economy, a position Agamben correctly describes as a form of economic theology. Although this perspective does not recognise Smith’s far more nuanced understanding of the invisible hand, it does represent one of the most problematic aspects of contemporary economics that still influences tertiary education, government policy, and society in general. Smith’s more complex and varied invisible hands do provide essential insights that transcend economic theology and its influence in economics today.

The threefold meaning of the invisible reflects the following practical implications for further exploration, namely criticism, ethics and empirical reality:

Firstly, criticism of the limitation of market dynamics underscores that markets do not function automatically. Markets are fragile and open to unethical influences justified by economic theology grounded in a supposed benevolent cosmology that enhances the common good. Smith’s invisible hand in WN underscores the opposite. It warns against the danger of collusion that undermines the welfare of all. The invisible hand symbolises criticism of the potential visible hands of greedy, power-hungry governments and businesses.

The second implication concerns the ethics of commerce, which is related to sympathetic sentiments and serves as a corrective for systemic failures in the TMS. The providential view of the invisible hand that Smith refers to in TMS is based on an orderly design that keeps reality in balance. Economically, this signifies a robust understanding of the exchange and distribution of resources, which are fragile and require ethical intervention to ensure fair distribution of goods. Accordingly, Smith foregrounds moral sentiment as a mediating force that operates within predominantly fragile and disordered socio-economic systems. It is precisely this constitutive disorder that market fundamentalists obscure through an economic theology which, as Agamben contends, neoliberal economists retrospectively ground in the doctrine of the invisible hand. Smith’s invisible hand in TMS rather supports ethical commerce and moral engagement, which is the foundation of economic reality (Sen 1999).

Finally, the superstitious and irrational explanation of meteorological events in HA serves as an important warning against similar beliefs that lack empirical validity. In this regard, the invisible hand also underscored the importance of empirical reality and the limitations of understanding complex events. However, this is not a reason to create a psychological mechanism to explain the incomprehensible. It rather requires greater analytical and empirical investigation to support social well-being. Therefore, the modern superstitious belief that the market is supported by a benevolent order should be exposed as a psychological tool to deal with repeated experiences of market inefficiency, a belief unsupported by empirical evidence.

For these reasons, the invisible hands of Smith offer an important perspective for the exploration of contemporary economic dilemmas that transcends economic theology, drawing on criticisms of corrupt markets and the importance of responsible, socially engaged decisions, as well as the ethical basis of commercial systems and the need for empirical validation.

6. Conclusions

This article interrogates Agamben’s critique of economic theology by tracing it back to Smith’s concept of the invisible hand. Agamben postulates that the invisible hand is an integral part of biopolitics, in which the bare life of individuals is regulated by governmental mechanisms. He associates this regulatory framework with a trinitarian structure that delegates power to immanent controlling entities such as the state, which pervades all societal functions, including economic systems. This governance is underpinned by a providential order, suggesting that sovereignty is vested with ultimate authority derived from divine sanctions. Within this context, the invisible hand in economic discourse epitomises this form of governance that has been misinterpreted by neoliberal economists. Giraud argues that Agamben’s reference to economic theology amounts to an endorsement of market fundamentalism and that it lacks empirical and textual substantiation in the writings of certain church fathers.

The present study employs a textually analytical approach, focusing directly on Smith’s citations. This investigation demonstrates that the concept of the invisible hand in Smith’s oeuvre exhibits variance and differentiation in meaning, referring to a critical and social morality in The Wealth of Nations, providence and sympathetic sentiments in The Theory of Moral Sentiments, and the psychological mechanism of religious superstition in The History of Astronomy. Hence, this threefold view of Smith’s invisible hands transcends reductionist interpretations by contemporary neoliberal economists, which construe the invisible hand strictly as an economic theology. The findings imply that the invisible hand was not an element of Smith’s market dogmatism but rather a metaphor illustrating Smith’s ontological development from theological paradigms (e.g., deism and superstition) to secular moral philosophy. Therefore, the invisible hands support the possibility of a critical, socially engaged, ethical, and empirically evaluated economics in a world of fragile, sometimes chaotic systems.