![]() "The individual undertaker ( entrepreneur), seeking the most efficient allocation of resources, contributes to overall economic efficiency the merchant’s reaction to price signals helps to ensure that the allocation of resources accurately reflects the structure of consumer preferences and the drive to better our condition contributes to economic growth." Marx and Engels The invisible hand theorem is an example of the unintended consequences of agents acting in their self-interest. The idea was also discussed by Adam Smith, the Scottish Enlightenment, and consequentialism (judging by results). The idea of unintended consequences dates back at least to John Locke who discussed the unintended consequences of interest rate regulation in his letter to Sir John Somers, Member of Parliament. Perverse result: A perverse effect contrary to what was originally intended (when an intended solution makes a problem worse).Unexpected drawback: An unexpected detriment occurring in addition to the desired effect of the policy (e.g., while irrigation schemes provide people with water for agriculture, they can increase waterborne diseases that have devastating health effects, such as schistosomiasis).Unexpected benefit: A positive unexpected benefit (also referred to as luck, serendipity or a windfall).Unintended consequences can be grouped into three types: ![]() The term was popularised in the twentieth century by American sociologist Robert K. ![]() ![]() In the social sciences, unintended consequences (sometimes unanticipated consequences or unforeseen consequences, more colloquially called knock-on effects) are outcomes of a purposeful action that are not intended or foreseen. An erosion gully in Australia caused by rabbits, an unintended consequence of their introduction as game animals ![]()
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