Question

"[The rich] consume little more than the poor, and in spite of their natural selfishness and rapacity ... 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."
What economic system does the evidence support?

• utopian socialism
• mercantilism
• communism
• laissez-faire capitaten

Answer 1

Laissez-faire capitalism.

Reason: The passage uses Adam Smith’s "invisible hand" argument that individuals' self-interest in free markets unintentionally promotes society’s welfare—an argument for minimal government interference, not for mercantilism, communism, or utopian socialism.