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# Natural Course of Capital Employment

## Definition

The tendency of financial resources to flow to their most productive uses without government intervention, based on market forces and comparative advantage. This natural allocation typically produces better outcomes than government-directed investment.

## Source Chapter

Book IV, Chapter 2

## Context

Smith argues that capital naturally seeks its most advantageous employment and that government attempts to direct capital often result in less efficient outcomes. He emphasizes that individuals pursuing their own interest typically promote more efficient capital allocation than government planners.

## Economic Domain

Accumulation

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