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Adam Smith

Adam Smith is the author of the book The Wealth of Nations and is considered the father of modern economics. He is the first one to study and analyze markets in detail. Modern economics is based on markets and the interaction of market participants. Smith describes the market as a place where all participants act in their own best interests to produce an efficient market. It is as if the market is guided by an invisible hand. The invisible hand concept is one of the theories that is the basis of modern market economies and one for which Adam Smith is most famous. The market serves to convey information to market participants, who act in accordance with the market signals. The economics of Adam Smith is laissez-faire economics. It is a marketplace that functions best without the interference of government. Smith is referred to on and off throughout the book.