Self-Interest
A fundamental concept in Adam Smith's theory, suggesting that individuals act in their own interest, benefiting society as a whole.
Updated April 24, 2026
Definition
Self-interest is the idea that individuals make economic decisions based on their personal benefits. Smith argued that when people pursue their own interests, they inadvertently contribute to the greater good.
Economic Implications
Smith believed that self-interest drives innovation and efficiency in markets. When entrepreneurs seek profits, they create products and services that fulfill societal needs, leading to economic growth.
Criticism and Legacy
While self-interest is a driving force in capitalism, it has faced criticism for potentially leading to greed and inequality. Nonetheless, it remains a central theme in economic theory and policy discussions today.
Example
According to Adam Smith, self-interest drives individuals to create goods that benefit society.
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