Free enterprise, competition in the marketplace, and Adam Smith's theory of the "invisible hand" allowed the US to develop the world's strongest economy. By favoring free markets and limiting monopolies, American economic policies encouraged competition and innovation that maximized productivity and growth, making the US a global economic leader according to Adam Smith's theory that individual self-interest inadvertently benefits society.

1. Free enterprise, competition at the market-place, and Adam Smith's "Invisible
Hand" made the United States the world's foremost economy.
By Heather Brock
After reading the text and related materials it is my understanding that the way
our country formed in the beginning and subsequent historical events that took place gave
the United States a boom into becoming a prosperous leading world economy. After
America gained it’s independence from Britain, we were a country who grew rapidly,
both financially and in population.
We were a country that was based on free enterprise and the hopes and
dreams of freedom, not just religious freedom, but personal financial freedoms limited
only by the creativity of the individuals who came and helped build and established our
country.
The early court systems favored competitive national markets and many laws
were passed that promoted competition and squashed monopolies. Even in areas of
transportations, ferries competed with bridges, railroads with canals and today airplanes
and trucks compete.
Because we were a new and underdeveloped country, we began with unlimited
natural resources. Land was plentiful, and people came and migrated developing the West
as they moved throughout the country seeking their own financial wealth in farming and
other areas which profited society as a whole.
The south’s cotton is a great example of this. They used slaves as rent-seeking
behavior to keep their costs down and their profits high. When technology came with the

2. cotton gin, we saw a remarkable market for being able to mass produce cotton and sell
and trade it internationally. According the text American Economic History, they
provided data we were the leading country in cotton exports. We became very productive
in farming and excelled in many areas that kept up with the world’s ever changing
technology.
Within our country, because there was free enterprise and competition in the
market place due to a non- monopolistic attitude, people serving their own interests
boosted the economy without meaning to do so.
Adam Smith in his “Invisible Hand” describes it best in his book when he writes “
“...every individual necessarily labours to render the annual revenue of the
society as great as he can. He generally, indeed, neither intends to promote the
public interest, nor knows how much he is promoting it. By preferring the
support of domestic to that of foreign industry, he intends only his own security;
and by directing that industry in such a manner as its produce may be of the
greatest value, he intends only his own gain, and he is in this, as in many other
cases, led by an invisible hand to promote an end which was no part of his
intention. Nor is it always the worse for the society that it was no part of it. By
pursuing his own interest he frequently promotes that of the society more
effectually than when he really intends to promote it. I have never known much
good done by those who affected to trade for the public good”
According to the video Vol. 2, "The Tyranny of Control, several important
things are pointed out. The first being is that open markets lead to low prices, good
quality products and high wages. When government gets involved to protect those who
feel they do have fair advantage, society as a whole suffers.

3. Free market competition is what made our country the foremost country in
economics. Being open to competition and staying active is essential to our economic
welfare. Government does play a role in providing stability and fairness. But as the video
points out that governments can and do go too far in controlling markets.
We see in our own country’s history where after the stock market crash in 1929
and the great depression that followed where too much control and government
regulation hindered our country’s economic welfare and recovery.
In other countries we see where government control keeps people from using up
to date technology, which limits productivity, free enterprise isn’t even an option and the
people remain poor and burdened and the whole society suffers. Their country is not able
to compete with the global market.
Free enterprise and competition at the market place is healthy for stimulating an
economy. Adam Smith’s opinion really makes an impression and logical sense that by
people looking out for their own best interests and buying domestically, individuals
inadvertently serve society as a whole.
When products and services are no longer able to compete they die out and new
ideas are born and the whole process seems to even itself out.
Having this openness to free trade and healthy competition backed with
government support, not control, pushed our country above the rest who hold to their
monopolistic ideals and communistic ideals.