Reviving the Invisible Hand: The Case for Classical Liberalism in the Twenty-first Century

Reviving the Invisible Hand is an uncompromising call for a global return to a classical liberal economic order, free of interference from governments and international organizations. Arguing for a revival of the invisible hand of free international trade and global capital, eminent economist Deepak Lal vigorously defends the view that statist attempts to ameliorate the impact of markets threaten global economic progress and stability. And in an unusual move, he not only defends globalization economically, but also answers the cultural and moral objections of antiglobalizers.

Taking a broad cross-cultural and interdisciplinary approach, Lal argues that there are two groups opposed to globalization: cultural nationalists who oppose not capitalism but Westernization, and "new dirigistes" who oppose not Westernization but capitalism. In response, Lal contends that capitalism doesn't have to lead to Westernization, as the examples of Japan, China, and India show, and that "new dirigiste" complaints have more to do with the demoralization of their societies than with the capitalist instruments of prosperity.

Lal bases his case on a historical account of the rise of capitalism and globalization in the first two liberal international economic orders: the nineteenth-century British, and the post-World War II American.

Arguing that the "new dirigisme" is the thin edge of a wedge that could return the world to excessive economic intervention by states and international organizations, Lal does not shrink from controversial stands such as advocating the abolishment of these organizations and defending the existence of child labor in the Third World.

"What would Adam Smith and David Hume have had to say about globalization, human rights, outsourcing and free trade, capital controls, the WTO, the IMF and the World Bank, Islamic fundamentalism, the rise of China and India, the environment, the welfare state, U.S. foreign policy, and every other major issue if they were alive today? The closest you can ever come to finding out is to read this brilliant and provocative book by the last, but by no means the least, of the classical liberals, Deepak Lal."--Ronald E. Findlay, Columbia University

"This splendidly and subtly argued defense of the classical liberal position makes a highly valuable contribution to the globalization debate."--Harold James, Princeton University, author ofThe End of Globalization

"Deepak Lal's Reviving the Invisible Hand is a brilliant account of modern economic theory and policy written from a rigorous classical liberal perspective. Lal shows a thorough knowledge of classical liberal theory and an enviable ability to apply it to any economy. Furthermore, he demonstrates that the greatest threat to world economic progress and stability comes not from old-fashioned socialism, but from the recent, fashionable modifications of the classical liberal model. It is remarkable that a technical economist should display such competence and originality in areas seemingly far removed from the diagrams and equations of orthodoxy. And his style is rigorous, well-paced, and just a little cheeky."--Norman Barry, University of Buckingham, England, author of Classical Liberalism in the Age of Post-Communism