Athar 1
Muhammad Qasim Yamaan Athar (2022110034)
Ms. Sauleha Kamal
Writing and Communication
13 November 2018
Self-interest May Not be in the Social Interest
When ‘The Wealth of Nations’ was first published, it was lauded as a masterful analysis
of the economic world, however, few at that time picked up on the moral and social themes in
the book. Adam Smith’s immortal words, “It is not from the benevolence of the butcher, the
brewer, or the baker that we expect our dinner, but from their regard to their own interest” laid
the basis for the ideology that is individualism, which favors the freedom of independent action
for everyone. Hence, the question whether social welfare can be achieved by individuals acting
in their own self-interest with little regard for the goals and needs of other members of society is
still the cause of much debate and intrigue amongst scholars today. In a digitally integrated
21st Century, the advent of social media has greatly increased our interactions with others and a
good deal of business is now conducted on this platform. Thus, understanding the relation
between individual self-interest and social well-being is of utmost importance to economists.
Keeping all aspects of the matter in mind, it can be said that acting in your self-interest does not
necessarily bring society closer to an idealistic state; in fact, it can have quite damaging
consequences. We first need to look at the context of the above quote in Smith’s book as well as
the role of morals and values in governing our behavior. Oftentimes, self-serving behavior leads
to corruption, market failure and monopolies with individuals disregarding the welfare of the
society and abusing the environment and labor, making government intervention necessary.
Athar 2
Firstly, we must consider Adam Smith’s own beliefs and philosophy to give context to
the quote in question and make its purpose more clear. While he was quite supportive of the
principle of self-interest, he also believed that governments have a major role to play in society.
As one recent biographer has put it, “Like most modern believers in free markets, Smith believed
that the government should enforce contracts and grant patents and copyrights to encourage
inventions and new ideas” (Econlib). Simply put, his vision of economic liberty could not be
realized unless a strong regulatory body was in place to keep individuals’ actions in check as he
himself realized the damaging consequences that self-seeking behavior could lead to. Similarly, a
lot of Smith’s teachings appear to be promoting ruthless selfishness, yet the man was a firm
believer in social values and a strict moral code. The Theory of Moral Sentiments, his first major
work, goes into great detail on the topics of charity and ethical behavior. An excerpt from the
book makes his feelings quite clear: “How selfish soever man may be supposed, there are
evidently some principles in his nature which interest him in the fortune of others and render
their happiness necessary to him though he derives nothing from it except the pleasure of seeing
it.” Today, charities, non-governmental and non-profit organizations all fit the criteria
of not working for their own gain but are still an indispensable source of social welfare. Some
like The Salvation Army, Food for the Poor and Feeding America
have a huge economic importance with billions of dollars’ worth of funds raised. (List25)
Countering Smith’s own claim, these groups do in fact depend on the benevolence of upstanding
members of the community to fulfill the needs of the less privileged. Therefore, it would be
unfair to discount the benefits that certain actions with no apparent self-serving
purpose can bring to a society.
Athar 3
Expanding more on unchecked self-seeking behavior, it is generally accepted that
humans are innately predisposed to neglect the well-being of others for their own gain. News of
fraud, embezzlement and corporate crime circulate the tabloids almost daily. Some of these cases
have become household names like the infamous 1920s swindler Charles Ponzi who fooled
Bostonian investors into separating with almost 15 million dollars of their hard earned cash-
more than 200 million in today’s money. (Smithsonian Magazine) So impactful were his actions
that the type of fraud he practiced was named after him and the term Ponzi Scheme is still in use
today. The notorious businessman turned criminal Bernie Madoff has a similar claim to fame. In
2008, it was uncovered that he had successfully perpetrated a Ponzi Scheme for almost two
decades and defrauded investors of a whopping 18 billion dollars. No one is safe from the grip of
such financial predators, not even innocent employees who have given their whole careers to a
