Invisible-hand Explanations
The invisible hand is a theory that shows that legislators, collective agreements and moral concerns are not indispensable to the emergence of social outcomes. It instead describes social outcomes as the unintended consequences of many self-interested actions on the part of individuals. Invisible-hand explanations however often raise criticisms. They are seen as falling short in two ways. First, they unpersuasively present the outcome they explain as an unintended consequence of agents' behaviour. Second, they are based on various unrealistic assumptions—that rulers have no impact, that collective agreements do not take place, that agents have no moral concerns —which cast doubt on the explanatory power of their model. The dissertation addresses these two issues. It begins by elucidating why the class of unintended consequences is likely to fail to fulfil its classificatory role. I then inquire whether invisible-hand explanations require that agents not intend the outcome to be accounted for. It moves on to explore the explanatory power of invisible-hand explanations. An invisible-hand explanation, according to some of its friends, does not get the facts right because it does not pick out the actual cause of the social outcome. Rather it points out its virtual cause and, hence, explains its resilience. On an alternative and more promising conception, invisible-hand explanations may well superficially resemble unsubstantiated fiction but they in fact leave aside the accidental features that compose the social realm in favour of its essential elements. It is therefore when one unsuitably expects the invisible hand to fully explain spatio-temporal social facts that one misses its explanatory value. Expanding on that view, I propose to approach invisible-hand explanations as philosophical explanations, that is, as elucidating the logical structure of social reality. They point out all that is needed for its functioning, neglecting its superfluous elements. I finally contrast the invisible-hand conception of social reality with Searle's theory of institutional facts. Both understand the institutional reality as one that involves the imposition of functions. But while Searle argues that such imposition needs collective intentionality to be performed, Menger shows how to dispense with the latter. Unlike Searle, however, the relation Menger sees between these functions and the satisfaction of individual interests prevents him from convincingly accounting for the normative dimensions of institutional reality.
