It has been more than two hundred years since the publication of the Wealth of Nations by Adam Smith, but there was hardly said anything more comprehensive and correct in what concerns the principles along which the world’s economy, markets and simply people function.
One of the most important concepts introduced by Adam Smith is the so-called “invisible hand”. In a society existing along the rules of free market and competition, every individual works for only and exclusively his own good, without cooperating with all the rest directly to achieve any other goals. Not a single one of them thinks about the greater good, the benefit of the state, of other people and organizations except for the ones he has something to do with.
Everyone is trying to achieve his own goals as good as they can. In the end, however it leads to cooperation and collaboration much more effective than can be created by directly controlling the whole process. As economist Paul Heine says, no one shows every single driver in the street where to drive his car; they all simply follow a set of simple rules and the process simply regulates itself to the advantage of all and everyone.
The same goes for market. When people are left to work and compete freely, without imposing any oppressive regulations on them, the result will always be more beneficial for everyone, including the state, than if the state tries to control their every move. The history shows again and again the truth of this idea, with the free market economies always being more dynamic and progressive. Adam Smith has created the idea that rules the world.