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# Natural Inclinations Thwarting

## Definition

The artificial interference with natural economic preferences through human institutions that prevent capital from flowing to its most preferred uses. This thwarting occurs when legal or customary restrictions force capital into less secure or less preferred investments, disrupting the natural order of economic development from agriculture through manufacturing to foreign trade.

## Source Chapter

Book III, Chapter 1

## Context

Smith identifies this institutional interference as the primary cause of unnatural economic development patterns, particularly in modern European states where the natural progression has been inverted through artificial constraints on capital movement.

## Economic Domain

Regulation

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