Why did Adam Smith argue that self-interest does not always mean selfishness?

Adam Smith argued that self-interest is not synonymous with selfishness because he viewed human motivation as rooted in local knowledge, specific concerns, and personal responsibilities, such as the well-being of one's family, rather than a broad, malicious disregard for others.1

In his philosophical framework, Smith posited that individuals are driven by passions but are simultaneously self-regulated by reason and a capacity for sympathy. He introduced the concept of an "inner man" or "impartial spectator," which acts as a moral compass, allowing individuals to judge their own actions and mitigate purely instinctual drives.23

Consequently, when Smith described economic agents as self-interested, he was characterizing them as actors responding to their immediate circumstances and local needs. Through the mechanism of the invisible hand, these individual pursuits—intended only to secure one's own livelihood or success—are often coordinated in a way that unintentionally advances the common good and the broader interests of society.12