Market logic failed to meet wartime production needs.

Evidence

The governing elites entered the war firmly believing in the power of what eighteenth-century Scottish economist Adam Smith called the “invisible hand”: private business and the law of supply and demand were enough to guarantee the most efficient production results. But the elites’ faith was soon tested. The increase in demand for war necessities raised prices but not productivity. While society suffered from food shortages and inflation, private business channeled resources into more profitable sectors, such as luxury goods and exports. — Clara E. Mattei, Escape from Capitalism, 166

Categorization

• XREF: Inverts her ‘invisible order’ thesis — here the invisible hand fails, forcing visible state intervention the system later codes as temporary. — connects to: War exposed the market’s self-regulating capacity as inadequate for total production — Clara E. Mattei, The Capital Order: How Economists…, 106; Laissez-faire failed spectacularly as a war economy mechanism by 1916 — Clara E. Mattei, The Capital Order: How Economists…, 123; Private profit-seeking by shipowners nearly collapsed Britain’s wartime supply — Clara E. Mattei, The Capital Order: How Economists…, 125 (+1 more)