INVISIBLE HAND: The notion that buyers and sellers, consumers and producers, households and businesses, pursuing their own self-interests, do what's best for the economy--automatically, without any government intervention, as if guided by an invisible hand. This invisible hand was essential to the economic analysis of markets in Adam Smith's The Wealth of Nations. It has continued to be cornerstone in conservative economic policies that call for limits on government intervention in the economy.

     See also | market | free market | laissez faire | free enterprise | Smith, Adam | efficiency | competition | allocation | The Wealth of Nations | conservative | liberal |

INVISIBLE HAND, AmosWEB GLOSS*arama, http://www.AmosWEB.com, AmosWEB LLC, 2000-2026. [Accessed: January 19, 2026].

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A taxation principle stating that taxes should be based on the ability to pay taxes. The ability-to-pay principle works from the proposition that those who have the greatest income should pay the most taxes. The ability-to-pay principle is the only reasonable way to finance the provision of public goods such as national defense, public health, and environmental quality. This is one of two taxation principles. The other is the benefit principle, which states taxes should be based on the benefits received.

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