In
economics
Economics () is the social science that studies the Production (economics), production, distribution (economics), distribution, and Consumption (economics), consumption of goods and services.
Economics focuses on the behaviour and intera ...
, a free market is an economic
system
A system is a group of Interaction, interacting or interrelated elements that act according to a set of rules to form a unified whole. A system, surrounded and influenced by its environment (systems), environment, is described by its boundaries, ...
in which the prices of goods and services are determined by
supply and demand
In microeconomics, supply and demand is an economic model of price determination in a Market (economics), market. It postulates that, Ceteris paribus, holding all else equal, in a perfect competition, competitive market, the unit price for a ...
expressed by sellers and buyers. Such markets, as modeled, operate without the intervention of
government
A government is the system or group of people governing an organized community, generally a state.
In the case of its broad associative definition, government normally consists of legislature, executive, and judiciary. Government is a ...
or any other external authority. Proponents of the free market as a normative ideal contrast it with a
regulated market
A regulated market (RM) or coordinated market is an idealized system where the government or other organizations oversee the market, control the forces of supply and demand, and to some extent regulate the market actions. This can include tasks ...
, in which a government intervenes in supply and demand by means of various methods such as
taxes
A tax is a compulsory financial charge or some other type of levy imposed on a taxpayer (an individual or legal entity) by a governmental organization in order to fund government spending and various public expenditures (regional, local, or ...
or
regulations
Regulation is the management of complex systems according to a set of rules and trends. In systems theory, these types of rules exist in various fields of biology and society, but the term has slightly different meanings according to context. For ...
. In an idealized
free market economy
A market economy is an economic system in which the decisions regarding investment, production and distribution to the consumers are guided by the price signals created by the forces of supply and demand, where all suppliers and consumers ar ...
, prices for goods and services are set solely by the bids and offers of the participants.
Scholars contrast the concept of a free market with the concept of a
coordinated market in fields of study such as
political economy
Political economy is the study of how Macroeconomics, economic systems (e.g. Marketplace, markets and Economy, national economies) and Politics, political systems (e.g. law, Institution, institutions, government) are linked. Widely studied ph ...
,
new institutional economics
New Institutional Economics (NIE) is an economic perspective that attempts to extend economics by focusing on the institutions (that is to say the sociology, social and legal Norm (sociology), norms and rules) that underlie economic activity and ...
,
economic sociology
Economic sociology is the study of the social cause and effect of various economic phenomena. The field can be broadly divided into a classical period and a contemporary one, known as "new economic sociology".
The classical period was concerned ...
and
political science
Political science is the scientific study of politics. It is a social science dealing with systems of governance and power, and the analysis of political activities, political thought, political behavior, and associated constitutions and la ...
. All of these fields emphasize the importance in currently existing market systems of rule-making institutions external to the simple forces of supply and demand which create space for those forces to operate to control productive output and distribution. Although free markets are commonly associated with
capitalism
Capitalism is an economic system based on the private ownership of the means of production and their operation for Profit (economics), profit. Central characteristics of capitalism include capital accumulation, competitive markets, pric ...
in contemporary usage and
popular culture
Popular culture (also called mass culture or pop culture) is generally recognized by members of a society as a set of practices, beliefs, artistic output (also known as, popular art or mass art) and objects that are dominant or prevalent in a ...
, free markets have also been components in some forms of
market socialism
Market socialism is a type of economic system involving the public, cooperative, or social ownership of the means of production in the framework of a market economy, or one that contains a mix of worker-owned, nationalized, and privately owned ...
.
Historically, free market has also been used synonymously with other economic policies. For instance proponents of ''laissez-faire'' capitalism, may refer to it as free market capitalism because they claim it to achieve the most economic freedom.
In practice, governments usually intervene to reduce
externalities
In economics, an externality or external cost is an indirect cost or benefit to an uninvolved third party that arises as an effect of another party's (or parties') activity. Externalities can be considered as unpriced goods involved in either co ...
such as
greenhouse gas emissions
Greenhouse gas emissions from human activities strengthen the greenhouse effect, contributing to climate change. Most is carbon dioxide from burning fossil fuels: coal, oil, and natural gas. The largest emitters include coal in China and lar ...
; although they may use markets to do so, such as
carbon emission trading
Emission trading (ETS) for carbon dioxide (CO2) and other greenhouse gases (GHG) is a form of carbon price, carbon pricing; also known as cap and trade (CAT) or carbon pricing. It is an approach to Climate change mitigation, limit climate c ...
.
Economic systems
Capitalism
Capitalism is an
economic system
An economic system, or economic order, is a system of Production (economics), production, resource allocation and Distribution (economics), distribution of goods and services within a society or a given geographic area. It includes the combinati ...
based on the
private ownership
Private property is a legal designation for the ownership of property by non-governmental Legal personality, legal entities. Private property is distinguishable from public property and Personal property, personal property, which is owned by a s ...
of the
means of production
The means of production is a term which describes land, labor and capital that can be used to produce products (such as goods or services); however, the term can also refer to anything that is used to produce products. It can also be used as an ...
and their operation for
profit
Profit may refer to:
Business and law
* Profit (accounting), the difference between the purchase price and the costs of bringing to market
* Profit (economics), normal profit and economic profit
* Profit (real property), a nonpossessory intere ...
.
[Chris Jenks. ''Core Sociological Dichotomies''. "Capitalism, as a mode of production, is an economic system of manufacture and exchange which is geared toward the production and sale of commodities within a market for profit, where the manufacture of commodities consists of the use of the formally free labor of workers in exchange for a wage to create commodities in which the manufacturer extracts surplus value from the labor of the workers in terms of the difference between the wages paid to the worker and the value of the commodity produced by him/her to generate that profit." London; Thousand Oaks, CA; New Delhi. Sage. p. 383.] Central characteristics of capitalism include
capital accumulation
Capital accumulation is the dynamic that motivates the pursuit of profit, involving the investment of money or any financial asset with the goal of increasing the initial monetary value of said asset as a financial return whether in the form o ...
,
competitive market
In economics, competition is a scenario where different economic firmsThis article follows the general economic convention of referring to all actors as firms; examples in include individuals and brands or divisions within the same (legal) firm ...
s, a
price system
In economics, a price system is a system through which the valuations of any forms of property (tangible or intangible) are determined. All societies use price systems in the allocation and exchange of resources as a consequence of scarcity. Even ...
, private property and the recognition of
property rights
The right to property, or the right to own property (cf. ownership) is often classified as a human right for natural persons regarding their possessions. A general recognition of a right to private property is found more rarely and is typically ...
,
voluntary exchange Voluntary exchange is the act of buyers and sellers freely and willingly engaging in market transactions.
Voluntary exchange is a fundamental assumption in classical economics and neoclassical economics which forms the basis of contemporary mainstr ...
, and
wage labor
Wage labour (also wage labor in American English), usually referred to as paid work, paid employment, or paid labour, refers to the socioeconomic relationship between a worker and an employer in which the worker sells their labour power under a ...
. In a
capitalist market economy
A market economy is an economic system in which the decisions regarding investment, production and distribution to the consumers are guided by the price signals created by the forces of supply and demand, where all suppliers and consumers are ...
, decision-making and investments are determined by every owner of wealth, property or production ability in
capital
Capital may refer to:
Common uses
* Capital city, a municipality of primary status
** List of national capital cities
* Capital letter, an upper-case letter Economics and social sciences
* Capital (economics), the durable produced goods used f ...
and
financial market
A financial market is a market in which people trade financial securities and derivatives at low transaction costs. Some of the securities include stocks and bonds, raw materials and precious metals, which are known in the financial markets ...
s whereas prices and the distribution of goods and services are mainly determined by competition in goods and services markets.
Economist
An economist is a professional and practitioner in the social sciences, social science discipline of economics.
The individual may also study, develop, and apply theories and concepts from economics and write about economic policy. Within this ...
s,
historian
A historian is a person who studies and writes about the past and is regarded as an authority on it. Historians are concerned with the continuous, methodical narrative and research of past events as relating to the human race; as well as the stu ...
s,
political economist
Political economy is the study of how economic systems (e.g. markets and national economies) and political systems (e.g. law, institutions, government) are linked. Widely studied phenomena within the discipline are systems such as labour mar ...
s and
sociologists have adopted different perspectives in their analyses of capitalism and have recognized various forms of it in practice. These include ''
laissez-faire
''Laissez-faire'' ( ; from french: laissez faire , ) is an economic system in which transactions between private groups of people are free from any form of economic interventionism (such as subsidies) deriving from special interest groups. ...
'' or
free-market capitalism
In economics, a free market is an economic system in which the prices of goods and services are determined by supply and demand expressed by sellers and buyers. Such markets, as modeled, operate without the intervention of government or any ot ...
,
state capitalism
State capitalism is an economic system in which the state undertakes business and commercial (i.e. for-profit) economic activity and where the means of production are nationalized as state-owned enterprises (including the processes of capital a ...
and
welfare capitalism
Welfare capitalism is capitalism that includes social welfare policies and/or the practice of businesses providing welfare services to their employees. Welfare capitalism in this second sense, or industrial paternalism, was centered on industrie ...
. Different
forms of capitalism
Capitalism is an economic system based on the private ownership of the means of production and their operation for profit. Central characteristics of capitalism include capital accumulation, competitive markets, price system, private p ...
feature varying degrees of free markets,
public ownership
State ownership, also called government ownership and public ownership, is the ownership of an industry, asset, or enterprise by the state or a public body representing a community, as opposed to an individual or private party. Public ownershi ...
, obstacles to free competition and state-sanctioned
social policies
Social policy is a plan or action of government or institutional agencies which aim to improve or reform society.
Some professionals and universities consider social policy a subset of public policy, while other practitioners characterize soci ...
. The degree of
competition
Competition is a rivalry where two or more parties strive for a common goal which cannot be shared: where one's gain is the other's loss (an example of which is a zero-sum game). Competition can arise between entities such as organisms, indivi ...
in
markets
Market is a term used to describe concepts such as:
* Market (economics), system in which parties engage in transactions according to supply and demand
* Market economy
*Marketplace, a physical marketplace or public market
Geography
*Märket, a ...
and the role of
intervention and
regulation
Regulation is the management of complex systems according to a set of rules and trends. In systems theory, these types of rules exist in various fields of biology and society, but the term has slightly different meanings according to context. For ...
as well as the scope of state ownership vary across different models of capitalism.
[''Macmillan Dictionary of Modern Economics'', 3rd Ed., 1986, p. 54.] The extent to which different markets are free and the rules defining private property are matters of politics and policy. Most of the existing capitalist economies are
mixed economies
A mixed economy is variously defined as an economic system blending elements of a market economy with elements of a planned economy, markets with state interventionism, or private enterprise with public enterprise. Common to all mixed economies ...
that combine elements of free markets with state intervention and in some cases
economic planning
Economic planning is a resource allocation mechanism based on a computational procedure for solving a constrained maximization problem with an iterative process for obtaining its solution. Planning is a mechanism for the allocation of resources b ...
.
[Stilwell, Frank. "Political Economy: the Contest of Economic Ideas". First Edition. Oxford University Press. Melbourne, Australia. 2002.]
Market economies
A market economy is an economic system in which the decisions regarding investment, production and distribution to the consumers are guided by the price signals created by the forces of supply and demand, where all suppliers and consumers are ...
have existed under many
forms of government
A government is the system or group of people governing an organized community, generally a State (polity), state.
In the case of its broad associative definition, government normally consists of legislature, Executive (government), e ...
and in many different times, places and cultures. Modern capitalist societies—marked by a universalization of
money
Money is any item or verifiable record that is generally accepted as payment for goods and services and repayment of debts, such as taxes, in a particular country or socio-economic context. The primary functions which distinguish money are as ...
-based
social relations
A social relation or also described as a social interaction or social experience is the fundamental unit of analysis within the social sciences, and describes any voluntary or involuntary interpersonal relationship between two or more individuals ...
, a consistently large and system-wide
class of workers
The working class (or labouring class) comprises those engaged in manual labour, manual-labour occupations or industrial work, who are remunerated via wage, waged or salary, salaried contracts. Working-class occupations (see also "Designation ...
who must work for wages (the
proletariat
The proletariat (; ) is the social class of wage-earners, those members of a society whose only possession of significant economic value is their labour power (their capacity to work). A member of such a class is a proletarian. Marxist philo ...
) and a
capitalist class
The bourgeoisie ( , ) is a social class, equivalent to the middle or upper middle class. They are distinguished from, and traditionally contrasted with, the proletariat by their affluence, and their great cultural and financial capital. They ...
which owns the means of production—developed in Western Europe in a process that led to the
Industrial Revolution
The Industrial Revolution was the transition to new manufacturing processes in Great Britain, continental Europe, and the United States, that occurred during the period from around 1760 to about 1820–1840. This transition included going f ...
. Capitalist systems with varying degrees of direct government intervention have since become dominant in the
Western world
The Western world, also known as the West, primarily refers to the various nations and state (polity), states in the regions of Europe, North America, and Oceania. and continue to spread. Capitalism has been shown to be strongly correlated with
economic growth
Economic growth can be defined as the increase or improvement in the inflation-adjusted market value of the goods and services produced by an economy in a financial year. Statisticians conventionally measure such growth as the percent rate of ...
.
Libertarians
Libertarianism (from french: libertaire, "libertarian"; from la, libertas, "freedom") is a political philosophy that upholds liberty as a core value. Libertarians seek to maximize autonomy and political freedom, and Minarchism, minimize the ...
are the strongest defenders of free markets.
Georgism
For classical economists such as
Adam Smith
Adam Smith (baptized 1723 – 17 July 1790) was a Scottish economist and philosopher who was a pioneer in the thinking of political economy and key figure during the Scottish Enlightenment. Seen by some as "The Father of Economics"——— ...
, the term free market refers to a market free from all forms of economic privilege, monopolies and artificial scarcities.
They say this implies that
economic rent
In economics, economic rent is any payment (in the context of a market transaction) to the owner of a factor of production in excess of the cost needed to bring that factor into production. In classical economics, economic rent is any payment m ...
s, which they describe as profits generated from a lack of
perfect competition
In economics, specifically general equilibrium theory, a perfect market, also known as an atomistic market, is defined by several idealizing conditions, collectively called perfect competition, or atomistic competition. In Economic model, theoret ...
, must be reduced or eliminated as much as possible through free competition.
Economic theory suggests the returns to
land
Land, also known as dry land, ground, or earth, is the solid terrestrial surface of the planet Earth that is not submerged by the ocean or other bodies of water. It makes up 29% of Earth's surface and includes the continents and various islan ...
and other
natural resource
Natural resources are resources that are drawn from nature and used with few modifications. This includes the sources of valued characteristics such as commercial and industrial use, aesthetic value, scientific interest and cultural value. O ...
s are economic rents that cannot be reduced in such a way because of their perfect inelastic supply. Some economic thinkers emphasize the need to share those rents as an essential requirement for a well functioning market. It is suggested this would both eliminate the need for regular taxes that have a negative effect on trade (see
deadweight loss
In economics, deadweight loss is the difference in production and consumption of any given product or service including government tax. The presence of deadweight loss is most commonly identified when the quantity produced ''relative'' to the amoun ...
) as well as release land and resources that are speculated upon or monopolised, two features that improve the competition and free market mechanisms.
Winston Churchill
Sir Winston Leonard Spencer Churchill (30 November 187424 January 1965) was a British statesman, soldier, and writer who served as Prime Minister of the United Kingdom twice, from 1940 to 1945 Winston Churchill in the Second World War, dur ...
supported this view by the following statement: "Land is the mother of all monopoly". The American economist and social philosopher
Henry George
Henry George (September 2, 1839 – October 29, 1897) was an American political economist and journalist. His writing was immensely popular in 19th-century America and sparked several reform movements of the Progressive Era. He inspired the eco ...
, the most famous proponent of this thesis, wanted to accomplish this through a high
land value tax
A land value tax (LVT) is a levy on the value of land (economics), land without regard to buildings, personal property and other land improvement, improvements. It is also known as a location value tax, a point valuation tax, a site valuation ta ...
that replaces all other taxes. Followers of his ideas are often called
Georgists
Georgism, also called in modern times Geoism, and known historically as the single tax movement, is an economic ideology holding that, although people should own the value they produce themselves, the economic rent derived from land—including ...
or geoists and
geolibertarians
Geolibertarianism is a political and economic ideology that integrates libertarianism with Georgism. It favors a taxation system based (as in Georgism) on income derived from land and natural resources instead of on labor, coupled with a minim ...
.
Léon Walras
Marie-Esprit-Léon Walras (; 16 December 1834 – 5 January 1910) was a French mathematical economist and Georgist. He formulated the marginal theory of value (independently of William Stanley Jevons and Carl Menger) and pioneered the developmen ...
, one of the founders of the
neoclassical economics
Neoclassical economics is an approach to economics in which the production, consumption and valuation (pricing) of goods and services are observed as driven by the supply and demand model. According to this line of thought, the value of a good ...
who helped formulate the
general equilibrium theory
In economics, general equilibrium theory attempts to explain the behavior of supply, demand, and prices in a whole economy with several or many interacting markets, by seeking to prove that the interaction of demand and supply will result in an ov ...
, had a very similar view. He argued that free competition could only be realized under conditions of state ownership of natural resources and land. Additionally, income taxes could be eliminated because the state would receive income to finance public services through owning such resources and enterprises.
''Laissez-faire''
The ''laissez-faire'' principle expresses a preference for an absence of non-market pressures on prices and wages such as those from discriminatory government
tax
A tax is a compulsory financial charge or some other type of levy imposed on a taxpayer (an individual or legal entity) by a governmental organization in order to fund government spending and various public expenditures (regional, local, or n ...
es,
subsidies
A subsidy or government incentive is a form of financial aid or support extended to an economic sector (business, or individual) generally with the aim of promoting economic and social policy. Although commonly extended from the government, the ter ...
,
tariff
A tariff is a tax imposed by the government of a country or by a supranational union on imports or exports of goods. Besides being a source of revenue for the government, import duties can also be a form of regulation of foreign trade and poli ...
s,
regulations
Regulation is the management of complex systems according to a set of rules and trends. In systems theory, these types of rules exist in various fields of biology and society, but the term has slightly different meanings according to context. For ...
, or
government-granted monopolies
In economics, a government-granted monopoly (also called a "de jure monopoly" or "regulated monopoly") is a form of coercive monopoly by which a government grants exclusive privilege to a private individual or firm to be the sole provider of a goo ...
. In ''The Pure Theory of Capital'',
Friedrich Hayek
Friedrich August von Hayek ( , ; 8 May 189923 March 1992), often referred to by his initials F. A. Hayek, was an Austrian–British economist, legal theorist and philosopher who is best known for his defense of classical liberalism. Haye ...
argued that the goal is the preservation of the unique information contained in the price itself.
[Hayek, Friedrich (1941). ''The Pure Theory of Capital''.]
According to Karl Popper, the idea of the free market is paradoxical, as it requires interventions towards the goal of preventing interventions.
Although ''laissez-faire'' has been commonly associated with
capitalism
Capitalism is an economic system based on the private ownership of the means of production and their operation for Profit (economics), profit. Central characteristics of capitalism include capital accumulation, competitive markets, pric ...
, there is a similar economic theory associated with
socialism
Socialism is a left-wing economic philosophy and movement encompassing a range of economic systems characterized by the dominance of social ownership of the means of production as opposed to private ownership. As a term, it describes the e ...
called left-wing or socialist ''laissez-faire'', also known as
free-market anarchism
Free-market anarchism, or market anarchism, also known as free-market anti-capitalism and free-market socialism, is the branch of anarchism that advocates a free-market economic system based on voluntary interactions without the involvement of ...
,
free-market anti-capitalism and
free-market socialism
Market socialism is a type of economic system involving the public, cooperative, or social ownership of the means of production in the framework of a market economy, or one that contains a mix of worker-owned, nationalized, and privately own ...
to distinguish it from ''laissez-faire'' capitalism. Critics of ''laissez-faire'' as commonly understood argue that a truly ''laissez-faire'' system would be
anti-capitalist
Anti-capitalism is a political ideology and Political movement, movement encompassing a variety of attitudes and ideas that oppose capitalism. In this sense, anti-capitalists are those who wish to replace capitalism with another type of economi ...
and
socialist
Socialism is a left-wing economic philosophy and movement encompassing a range of economic systems characterized by the dominance of social ownership of the means of production as opposed to private ownership. As a term, it describes the e ...
. American
individualist anarchists
Individualism is the moral stance, political philosophy, ideology and social outlook that emphasizes the intrinsic worth of the individual. Individualists promote the exercise of one's goals and desires and to value independence and self-relia ...
such as
Benjamin Tucker
Benjamin Ricketson Tucker (; April 17, 1854 – June 22, 1939) was an American individualist anarchist and libertarian socialist.Martin, James J. (1953)''Men Against the State: The Expositers of Individualist Anarchism in America, 1827–1908''< ...
saw themselves as economic free-market socialists and political individualists while arguing that their "anarchistic socialism" or "individual anarchism" was "consistent
Manchesterism
Manchester Liberalism (also called the Manchester School, Manchester Capitalism and Manchesterism) comprises the political, economic and social movements of the 19th century that originated in Manchester, England. Led by Richard Cobden and Joh ...
".
Socialism
Various forms of
socialism
Socialism is a left-wing economic philosophy and movement encompassing a range of economic systems characterized by the dominance of social ownership of the means of production as opposed to private ownership. As a term, it describes the e ...
based on free markets have existed since the 19th century. Early notable socialist proponents of free markets include
Pierre-Joseph Proudhon
Pierre-Joseph Proudhon (, , ; 15 January 1809, Besançon – 19 January 1865, Paris) was a French socialist,Landauer, Carl; Landauer, Hilde Stein; Valkenier, Elizabeth Kridl (1979) 959 "The Three Anticapitalistic Movements". ''European Socia ...
,
Benjamin Tucker
Benjamin Ricketson Tucker (; April 17, 1854 – June 22, 1939) was an American individualist anarchist and libertarian socialist.Martin, James J. (1953)''Men Against the State: The Expositers of Individualist Anarchism in America, 1827–1908''< ...
and the
Ricardian socialist
Ricardian socialism is a branch of classical economic thought based upon the work of the economist David Ricardo (1772–1823). The term is used to describe economists in the 1820s and 1830s who developed a theory of capitalist exploitation from ...
s. These economists believed that genuinely free markets and
voluntary exchange Voluntary exchange is the act of buyers and sellers freely and willingly engaging in market transactions.
Voluntary exchange is a fundamental assumption in classical economics and neoclassical economics which forms the basis of contemporary mainstr ...
could not exist within the
exploitative conditions of
capitalism
Capitalism is an economic system based on the private ownership of the means of production and their operation for Profit (economics), profit. Central characteristics of capitalism include capital accumulation, competitive markets, pric ...
. These proposals ranged from various forms of
worker cooperative
A worker cooperative is a cooperative owned and Workers' self-management, self-managed by its workers. This control may mean a firm where every worker-owner participates in decision-making in a democratic fashion, or it may refer to one in which ...
s operating in a free-market economy such as the
mutualist system proposed by Proudhon, to state-owned enterprises operating in unregulated and open markets. These models of socialism are not to be confused with other forms of market socialism (e.g. the
Lange model
The Lange model (or Lange–Lerner theorem) is a neoclassical economic model for a hypothetical socialist economy based on public ownership of the means of production and a trial-and-error approach to determining output targets and achieving econ ...
) where publicly owned enterprises are coordinated by various degrees of
economic planning
Economic planning is a resource allocation mechanism based on a computational procedure for solving a constrained maximization problem with an iterative process for obtaining its solution. Planning is a mechanism for the allocation of resources b ...
, or where capital good prices are determined through marginal cost pricing.
Advocates of free-market socialism such as
Jaroslav Vanek
Jaroslav (also written as Yaroslav or Jarosław in other Slavic languages) is a Czech and Slovak first name, pagan in origin.
There are several possible origins of the name Jaroslav. It is very likely that originally the two elements of the nam ...
argue that genuinely free markets are not possible under conditions of private ownership of productive property. Instead, he contends that the class differences and inequalities in income and power that result from private ownership enable the interests of the dominant class to skew the market to their favor, either in the form of monopoly and market power, or by utilizing their wealth and resources to legislate government policies that benefit their specific business interests. Additionally, Vanek states that workers in a socialist economy based on cooperative and self-managed enterprises have stronger incentives to maximize productivity because they would receive a share of the profits (based on the overall performance of their enterprise) in addition to receiving their fixed wage or salary. The stronger incentives to maximize productivity that he conceives as possible in a socialist economy based on cooperative and self-managed enterprises might be accomplished in a free-market economy if
employee-owned companies
Employee stock ownership, or employee share ownership, is where a company's employees own shares in that company (or in the parent company of a group of companies). US employees typically acquire shares through a share option plan. In the UK, Em ...
were the norm as envisioned by various thinkers including
Louis O. Kelso
Louis Orth Kelso (; December 4, 1913 – February 17, 1991) was a political economist, corporate and financial lawyer, author, lecturer and merchant banker who is chiefly remembered today as the inventor and pioneer of the employee stock ownersh ...
and
James S. Albus
James Sacra Albus (May 4, 1935 – April 17, 2011) was an American engineer, Senior NIST Fellow and founder and former chief of the Intelligent Systems Division of the Manufacturing Engineering Laboratory at the National Institute of Standards an ...
.
Socialists also assert that
free-market capitalism
In economics, a free market is an economic system in which the prices of goods and services are determined by supply and demand expressed by sellers and buyers. Such markets, as modeled, operate without the intervention of government or any ot ...
leads to an excessively skewed distributions of income and economic instabilities which in turn leads to social instability. Corrective measures in the form of
social welfare
Welfare, or commonly social welfare, is a type of government support intended to ensure that members of a society can meet Basic needs, basic human needs such as food and shelter. Social security may either be synonymous with welfare, or refe ...
, re-distributive taxation and regulatory measures and their associated administrative costs which are required create agency costs for society. These costs would not be required in a self-managed socialist economy.
[''The Political Economy of Socialism'', by Horvat, Branko (1982), pp. 197–198.]
Criticism of market socialism comes from two major directions.
Nobel Prize
The Nobel Prizes ( ; sv, Nobelpriset ; no, Nobelprisen ) are five separate prizes that, according to Alfred Nobel's will of 1895, are awarded to "those who, during the preceding year, have conferred the greatest benefit to humankind." Alfr ...
winning economists
Friedrich Hayek
Friedrich August von Hayek ( , ; 8 May 189923 March 1992), often referred to by his initials F. A. Hayek, was an Austrian–British economist, legal theorist and philosopher who is best known for his defense of classical liberalism. Haye ...
and
George Stigler
George Joseph Stigler (; January 17, 1911 – December 1, 1991) was an American economist. He was the 1982 laureate in Nobel Memorial Prize in Economic Sciences and is considered a key leader of the Chicago school of economics.
Early life and ...
, argued that socialism as a theory isn’t conducive of democratic systems and even the most benevolent state would face serious implementation problems.
More modern criticism of socialism and
market socialism
Market socialism is a type of economic system involving the public, cooperative, or social ownership of the means of production in the framework of a market economy, or one that contains a mix of worker-owned, nationalized, and privately owned ...
implies that even in a democratic system socialism fails to reach the desired efficient outcome. This argument underlines that the democratic process itself becomes detrimental to businesses and enterprise. It highlights how the democratic majority rule becomes detrimental to enterprises and industries, and how formation of interest groups distorts the optimal market outcome.
Concepts
Economic equilibrium
![FreePrice](https://upload.wikimedia.org/wikipedia/commons/e/ed/FreePrice.JPG)
The
general equilibrium theory
In economics, general equilibrium theory attempts to explain the behavior of supply, demand, and prices in a whole economy with several or many interacting markets, by seeking to prove that the interaction of demand and supply will result in an ov ...
has demonstrated that, under certain theoretical conditions of
perfect competition
In economics, specifically general equilibrium theory, a perfect market, also known as an atomistic market, is defined by several idealizing conditions, collectively called perfect competition, or atomistic competition. In Economic model, theoret ...
, the law of
supply and demand
In microeconomics, supply and demand is an economic model of price determination in a Market (economics), market. It postulates that, Ceteris paribus, holding all else equal, in a perfect competition, competitive market, the unit price for a ...
influences prices toward an
equilibrium that balances the demands for the products against the supplies. At these equilibrium prices, the market distributes the products to the purchasers according to each purchaser's preference or
utility
As a topic of economics, utility is used to model worth or value. Its usage has evolved significantly over time. The term was introduced initially as a measure of pleasure or happiness as part of the theory of utilitarianism by moral philosopher ...
for each product and within the relative limits of each buyer's
purchasing power
Purchasing power is the amount of goods and services that can be purchased with a unit of currency. For example, if one had taken one unit of currency to a store in the 1950s, it would have been possible to buy a greater number of items than would ...
. This result is described as market efficiency, or more specifically a
Pareto optimum
Pareto efficiency or Pareto optimality is a situation where no action or allocation is available that makes one individual better off without making another worse off. The concept is named after Vilfredo Pareto (1848–1923), Italian civil engine ...
.
Low barriers to entry
A free market does not directly require the existence of competition; however, it does require a framework that freely allows new market entrants. Hence, competition in a free market is a consequence of the conditions of a free market, including that market participants not be obstructed from following their
profit motive
In economics, the profit motive is the motivation of firms that operate so as to maximize their profits. Mainstream microeconomic theory posits that the ultimate goal of a business is "to make money" - not in the sense of increasing the firm's s ...
.
Perfect competition and market failure
An absence of any of the conditions of perfect competition is considered a
market failure
In neoclassical economics, market failure is a situation in which the allocation of goods and services by a free market is not Pareto efficient, often leading to a net loss of economic value. Market failures can be viewed as scenarios where indiv ...
. Regulatory intervention may provide a substitute force to counter a market failure, which leads some economists to believe that some forms of market regulation may be better than an unregulated market at providing a free market.
Spontaneous order
Friedrich Hayek
Friedrich August von Hayek ( , ; 8 May 189923 March 1992), often referred to by his initials F. A. Hayek, was an Austrian–British economist, legal theorist and philosopher who is best known for his defense of classical liberalism. Haye ...
popularized the view that market economies promote
spontaneous order
Spontaneous order, also named self-organization in the hard sciences, is the spontaneous emergence of order out of seeming chaos. The term "self-organization" is more often used for physical changes and biological processes, while "spontaneous o ...
which results in a better "allocation of societal resources than any design could achieve". According to this view, market economies are characterized by the formation of complex transactional networks that produce and distribute goods and services throughout the economy. These networks are not designed, but they nevertheless emerge as a result of decentralized individual economic decisions. The idea of spontaneous order is an elaboration on the
invisible hand
The invisible hand is a metaphor used by the British moral philosopher Adam Smith that describes the unintended greater social benefits and public good brought about by individuals acting in their own self-interests. Smith originally mention ...
proposed by
Adam Smith
Adam Smith (baptized 1723 – 17 July 1790) was a Scottish economist and philosopher who was a pioneer in the thinking of political economy and key figure during the Scottish Enlightenment. Seen by some as "The Father of Economics"——— ...
in ''
The Wealth of Nations
''An Inquiry into the Nature and Causes of the Wealth of Nations'', generally referred to by its shortened title ''The Wealth of Nations'', is the ''magnum opus'' of the Scottish economist and moral philosopher Adam Smith. First published in 1 ...
''. About the individual, Smith wrote:
By preferring the support of domestic to that of foreign industry, he intends only his own security; and by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention. Nor is it always the worse for society that it was no part of it. By pursuing his own interest, he frequently promotes that of the society more effectually than when he really intends to promote it. I have never known much good done by those who affected to trade for the public good.
Smith pointed out that one does not get one's dinner by appealing to the brother-love of the butcher, the farmer or the baker. Rather, one appeals to their self-interest and pays them for their labor, arguing:
It is not from the benevolence of the butcher, the brewer or the baker, that we expect our dinner, but from their regard to their own self-interest. We address ourselves, not to their humanity but to their self-love, and never talk to them of our own necessities but of their advantages.
Supporters of this view claim that spontaneous order is superior to any order that does not allow individuals to make their own choices of what to produce, what to buy, what to sell and at what prices due to the number and complexity of the factors involved. They further believe that any attempt to implement central planning will result in more disorder, or a less efficient production and distribution of goods and services.
Critics such as political economist
Karl Polanyi
Karl Paul Polanyi (; hu, Polányi Károly ; 25 October 1886 – 23 April 1964),''Encyclopædia Britannica'' (Chicago: Encyclopædia Britannica Inc. 2003) vol 9. p. 554 was an Austro-Hungarian economic anthropologist and politician, best known ...
question whether a spontaneously ordered market can exist, completely free of distortions of political policy, claiming that even the ostensibly freest markets require a state to exercise coercive power in some areas, namely to enforce
contract
A contract is a legally enforceable agreement between two or more parties that creates, defines, and governs mutual rights and obligations between them. A contract typically involves the transfer of goods, services, money, or a promise to tran ...
s, govern the formation of
labor union
A trade union (labor union in American English), often simply referred to as a union, is an organization of workers intent on "maintaining or improving the conditions of their employment", ch. I such as attaining better wages and benefits ( ...
s, spell out the rights and obligations of
corporation
A corporation is an organization—usually a group of people or a company—authorized by the state to act as a single entity (a legal entity recognized by private and public law "born out of statute"; a legal person in legal context) and r ...
s, shape who has standing to bring legal actions and define what constitutes an unacceptable
conflict of interest
A conflict of interest (COI) is a situation in which a person or organization is involved in multiple interests, financial or otherwise, and serving one interest could involve working against another. Typically, this relates to situations i ...
.
Supply and demand
Demand for an item (such as goods or services) refers to the economic market pressure from people trying to buy it. Buyers have a maximum price they are willing to pay for an item, and sellers have a minimum price at which they are willing to offer their product. The point at which the supply and demand curves meet is the equilibrium price of the good and quantity demanded. Sellers willing to offer their goods at a lower price than the equilibrium price receive the difference as
producer surplus
In mainstream economics, economic surplus, also known as total welfare or total social welfare or Marshallian surplus (after Alfred Marshall), is either of two related quantities:
* Consumer surplus, or consumers' surplus, is the monetary gain ...
. Buyers willing to pay for goods at a higher price than the equilibrium price receive the difference as
consumer surplus
In mainstream economics, economic surplus, also known as total welfare or total social welfare or Marshallian surplus (after Alfred Marshall), is either of two related quantities:
* Consumer surplus, or consumers' surplus, is the monetary gain ...
.
The model is commonly applied to wages in the market for labor. The typical roles of supplier and consumer are reversed. The suppliers are individuals, who try to sell (supply) their labor for the highest price. The consumers are businesses, which try to buy (demand) the type of labor they need at the lowest price. As more people offer their labor in that market, the equilibrium wage decreases and the equilibrium level of employment increases as the supply curve shifts to the right. The opposite happens if fewer people offer their wages in the market as the supply curve shifts to the left.
In a free market, individuals and firms taking part in these transactions have the liberty to enter, leave and participate in the market as they so choose. Prices and quantities are allowed to adjust according to economic conditions in order to reach equilibrium and allocate resources. However, in many countries around the world governments seek to intervene in the free market in order to achieve certain social or political agendas. Governments may attempt to create
social equality
Social equality is a state of affairs in which all individuals within a specific society have equal rights, liberties, and status, possibly including civil rights, freedom of expression, autonomy, and equal access to certain public goods and ...
or
equality of outcome
Equality of outcome, equality of condition, or equality of results is a political concept which is central to some political ideologies and is used in some political discourse, often in contrast to the term equality of opportunity. It describes a ...
by intervening in the market through actions such as imposing a
minimum wage
A minimum wage is the lowest remuneration that employers can legally pay their employees—the price floor below which employees may not sell their labor. Most countries had introduced minimum wage legislation by the end of the 20th century. Bec ...
(price floor) or erecting
price controls
Price controls are restrictions set in place and enforced by governments, on the prices that can be charged for goods and services in a market. The intent behind implementing such controls can stem from the desire to maintain affordability of good ...
(price ceiling). Other lesser-known goals are also pursued, such as in the United States, where the federal government subsidizes owners of fertile land to not grow crops in order to prevent the supply curve from further shifting to the right and decreasing the equilibrium price. This is done under the justification of maintaining farmers' profits; due to the relative
inelasticity of demand for crops, increased supply would lower the price but not significantly increase quantity demanded, thus placing pressure on farmers to exit the market. Those interventions are often done in the name of maintaining basic assumptions of free markets such as the idea that the costs of production must be included in the price of goods. Pollution and depletion costs are sometimes not included in the cost of production (a manufacturer that withdraws water at one location then discharges it polluted downstream, avoiding the cost of treating the water), therefore governments may opt to impose regulations in an attempt to try to internalize all of the cost of production and ultimately include them in the price of the goods.
Advocates of the free market contend that government intervention hampers economic growth by disrupting the efficient allocation of resources according to supply and demand while critics of the free market contend that government intervention is sometimes necessary to protect a country's economy from better-developed and more influential economies, while providing the stability necessary for wise long-term investment.
Milton Friedman
Milton Friedman (; July 31, 1912 – November 16, 2006) was an American economist and statistician who received the 1976 Nobel Memorial Prize in Economic Sciences for his research on consumption analysis, monetary history and theory and the ...
argued against
central planning
A planned economy is a type of economic system where investment, production and the allocation of capital goods takes place according to economy-wide economic plans and production plans. A planned economy may use centralized, decentralized, part ...
,
price controls
Price controls are restrictions set in place and enforced by governments, on the prices that can be charged for goods and services in a market. The intent behind implementing such controls can stem from the desire to maintain affordability of good ...
and
state-owned corporations, particularly as practiced in the
Soviet Union
The Soviet Union,. officially the Union of Soviet Socialist Republics. (USSR),. was a transcontinental country that spanned much of Eurasia from 1922 to 1991. A flagship communist state, it was nominally a federal union of fifteen national ...
and
China
China, officially the People's Republic of China (PRC), is a country in East Asia. It is the world's most populous country, with a population exceeding 1.4 billion, slightly ahead of India. China spans the equivalent of five time zones and ...
while
Ha-Joon Chang
Ha-Joon Chang (; ; born 7 October 1963) is a South Korean institutional economist, specialising in development economics. Chang is the author of several widely discussed policy books, most notably ''Kicking Away the Ladder: Development Strateg ...
cites the examples of post-war Japan and the growth of South Korea's steel industry as positive examples of government intervention.
Criticism
Critics of a ''laissez-faire'' free market have argued that in real world situations it has proven to be susceptible to the development of
price fixing
Price fixing is an anticompetitive agreement between participants on the same side in a market to buy or sell a product, service, or commodity only at a fixed price, or maintain the market conditions such that the price is maintained at a given ...
monopolies. Such reasoning has led to government intervention, e.g. the
United States antitrust law
In the United States, antitrust law is a collection of mostly federal laws that regulate the conduct and organization of businesses to promote competition and prevent unjustified monopolies. The three main U.S. antitrust statutes are the Sherman ...
. Critics of the free market also argue that it results in significant
market dominance
Market dominance describes when a firm can control markets. A dominant firm possesses the power to affect competition and influence market price. A firms' dominance is a measure of the power of a brand, product, service, or firm, relative to c ...
,
inequality of bargaining power
Inequality of bargaining power in law, economics and social sciences refers to a situation where one party to a bargain, contract or agreement, has more and better alternatives than the other party. This results in one party having greater power ...
, or
information asymmetry
In contract theory and economics, information asymmetry deals with the study of decisions in transactions where one party has more or better information than the other.
Information asymmetry creates an imbalance of power in transactions, which ca ...
, in order to allow markets to function more freely.
Critics of a free market often argue that some market failures require government intervention.
Economists
Ronald Coase
Ronald Harry Coase (; 29 December 1910 – 2 September 2013) was a British economist and author. Coase received a bachelor of commerce degree (1932) and a PhD from the London School of Economics, where he was a member of the faculty until 1951. ...
,
Milton Friedman
Milton Friedman (; July 31, 1912 – November 16, 2006) was an American economist and statistician who received the 1976 Nobel Memorial Prize in Economic Sciences for his research on consumption analysis, monetary history and theory and the ...
,
Ludwig von Mises
Ludwig Heinrich Edler von Mises (; 29 September 1881 – 10 October 1973) was an Austrian School economist, historian, logician, and Sociology, sociologist. Mises wrote and lectured extensively on the societal contributions of classical liberali ...
, and
Friedrich Hayek
Friedrich August von Hayek ( , ; 8 May 189923 March 1992), often referred to by his initials F. A. Hayek, was an Austrian–British economist, legal theorist and philosopher who is best known for his defense of classical liberalism. Haye ...
have responded by arguing that markets can internalize or adjust to supposed market failures.
Two prominent Canadian authors argue that government at times has to intervene to ensure competition in large and important industries.
Naomi Klein
Naomi A. Klein (born May 8, 1970) is a Canadian author, social activist, and filmmaker known for her political analyses, support of ecofeminism, organized labour, left-wing politics and criticism of corporate globalization, fascism, ecofascism ...
illustrates this roughly in her work ''
The Shock Doctrine
''The Shock Doctrine: The Rise of Disaster Capitalism'' is a 2007 book by the Canadian author and social activist Naomi Klein. In the book, Klein argues that neoliberal free market policies (as advocated by the economist Milton Friedman) have ri ...
'' and
John Ralston Saul
John Ralston Saul (born June 19, 1947) is a Canadian writer, political philosopher, and public intellectual. Saul is most widely known for his writings on the nature of individualism, citizenship and the public good; the failures of manager-l ...
more humorously illustrates this through various examples in ''The Collapse of Globalism and the Reinvention of the World''.
[Saul, John ''The End of Globalism''.] While its supporters argue that only a free market can create healthy competition and therefore more business and reasonable prices, opponents say that a free market in its purest form may result in the opposite. According to Klein and Ralston, the merging of companies into giant corporations or the privatization of government-run industry and national assets often result in monopolies or oligopolies requiring government intervention to
force competition and reasonable prices.
Another form of market failure is
speculation
In finance, speculation is the purchase of an asset (a commodity, good (economics), goods, or real estate) with the hope that it will become more valuable shortly. (It can also refer to short sales in which the speculator hopes for a decline i ...
, where transactions are made to profit from short term fluctuation, rather from the
intrinsic value of the companies or products. This criticism has been challenged by historians such as
Lawrence Reed
Lawrence "Larry" W. Reed (born September 29, 1953), also known as Larry Reed, is president emeritus of the Foundation for Economic Education (FEE), where he has served as the Humphreys Family Senior Fellow since May 2019. Before joining FEE, Re ...
, who argued that monopolies have historically failed to form even in the absence of antitrust law. This is because monopolies are inherently difficult to maintain as a company that tries to maintain its monopoly by buying out new competitors, for instance, is incentivizing newcomers to enter the market in hope of a buy-out. Furthermore, according to writer Walter Lippman and economist Milton Friedman, historical analysis of the formation of monopolies reveals that, contrary to popular belief, these were the result not of unfettered market forces, but of legal privileges granted by government.
American philosopher and author
Cornel West
Cornel Ronald West (born June 2, 1953) is an American philosopher, political activist, social critic, actor, and public intellectual. The grandson of a Baptist minister, West focuses on the role of race, gender, and class in American society and ...
has derisively termed what he perceives as
dogma
Dogma is a belief or set of beliefs that is accepted by the members of a group without being questioned or doubted. It may be in the form of an official system of principles or doctrines of a religion, such as Roman Catholicism, Judaism, Islam ...
tic arguments for ''
laissez-faire
''Laissez-faire'' ( ; from french: laissez faire , ) is an economic system in which transactions between private groups of people are free from any form of economic interventionism (such as subsidies) deriving from special interest groups. ...
'' economic policies as
free-market fundamentalism
Market fundamentalism, also known as free-market fundamentalism, is a term applied to a strong belief in the ability of unregulated ''laissez-faire'' or free-market capitalist policies to solve most economic and social problems. It is often used ...
. West has contended that such mentality "trivializes the concern for public interest" and "makes money-driven, poll-obsessed elected officials deferential to corporate goals of profit – often at the cost of the common good". American political philosopher
Michael J. Sandel
Michael Joseph Sandel (; born March 5, 1953) is an American political philosopher and the Anne T. and Robert M. Bass Professor of Government Theory at Harvard University Law School, where his course Justice was the university's first course t ...
contends that in the last thirty years the United States has moved beyond just having a market economy and has become a market society where literally everything is for sale, including aspects of social and civic life such as education, access to justice and political influence. The economic historian
Karl Polanyi
Karl Paul Polanyi (; hu, Polányi Károly ; 25 October 1886 – 23 April 1964),''Encyclopædia Britannica'' (Chicago: Encyclopædia Britannica Inc. 2003) vol 9. p. 554 was an Austro-Hungarian economic anthropologist and politician, best known ...
was highly critical of the idea of the market-based society in his book ''
The Great Transformation'', noting that any attempt at its creation would undermine human society and the common good.
David McNally of the University of Houston argues in the Marxist tradition that the logic of the market inherently produces inequitable outcomes and leads to unequal exchanges, arguing that
Adam Smith
Adam Smith (baptized 1723 – 17 July 1790) was a Scottish economist and philosopher who was a pioneer in the thinking of political economy and key figure during the Scottish Enlightenment. Seen by some as "The Father of Economics"——— ...
's moral intent and moral philosophy espousing equal exchange was undermined by the practice of the free market he championed. According to McNally, the development of the
market economy
A market economy is an economic system in which the decisions regarding investment, production and distribution to the consumers are guided by the price signals created by the forces of supply and demand, where all suppliers and consumers ...
involved coercion, exploitation and violence that Smith's moral philosophy could not countenance. McNally also criticizes market socialists for believing in the possibility of fair markets based on equal exchanges to be achieved by purging parasitical elements from the market economy such as
private ownership
Private property is a legal designation for the ownership of property by non-governmental Legal personality, legal entities. Private property is distinguishable from public property and Personal property, personal property, which is owned by a s ...
of the
means of production
The means of production is a term which describes land, labor and capital that can be used to produce products (such as goods or services); however, the term can also refer to anything that is used to produce products. It can also be used as an ...
, arguing that
market socialism
Market socialism is a type of economic system involving the public, cooperative, or social ownership of the means of production in the framework of a market economy, or one that contains a mix of worker-owned, nationalized, and privately owned ...
is an oxymoron when
socialism
Socialism is a left-wing economic philosophy and movement encompassing a range of economic systems characterized by the dominance of social ownership of the means of production as opposed to private ownership. As a term, it describes the e ...
is defined as an end to
wage labour
Wage labour (also wage labor in American English), usually referred to as paid work, paid employment, or paid labour, refers to the socioeconomic relationship between a worker and an employer in which the worker sells their labour power under ...
.
See also
*
Binary economics
Binary economics, also known as two-factor economics, is a theory of economics that endorses both private property and a free market but proposes significant reforms to the bank, banking system.
According to theories first proposed by Louis Kelso ...
*
Crony capitalism
Crony capitalism, sometimes called cronyism, is an economic system in which businesses thrive not as a result of free enterprise, but rather as a return on money amassed through collusion between a business class and the political class. This is ...
*
Economic liberalism
Economic liberalism is a political and economic ideology that supports a market economy based on individualism and private property in the means of production. Adam Smith is considered one of the primary initial writers on economic liberalism ...
*
Freedom of choice
Freedom of choice describes an individual's opportunity and autonomy to perform an action selected from at least two available options, unconstrained by external parties.
In politics
In the abortion debate, for example, the term "freedom of ch ...
*
Free price system
A free price system or free price mechanism (informally called ''the price system'' or ''the price mechanism'') is a mechanism of resource allocation that relies upon prices set by the interchange of supply and demand. The resulting price signals ...
*
Grey market
A grey market or dark market (sometimes confused with the similar term " parallel market") is the trade of a commodity through distribution channels that are not authorized by the original manufacturer or trade mark proprietor. Grey market pr ...
*
Left-wing market anarchism
Free-market anarchism, or market anarchism, also known as free-market anti-capitalism and free-market socialism, is the branch of anarchism that advocates a free-market economic system based on voluntary interactions without the involvement of ...
*
Market economy
A market economy is an economic system in which the decisions regarding investment, production and distribution to the consumers are guided by the price signals created by the forces of supply and demand, where all suppliers and consumers ...
*
Neoliberalism
Neoliberalism (also neo-liberalism) is a term used to signify the late 20th century political reappearance of 19th-century ideas associated with free-market capitalism after it fell into decline following the Second World War. A prominent fa ...
*
Participatory economics
Participatory economics, often abbreviated Parecon, is an economic system based on participatory decision making as the primary economic mechanism for allocation in society. In the system, the say in decision-making is proportional to the impact ...
*
Quasi-market
Quasi-markets are markets which can be supervised and organisationally designed that are intended to create greater desire and more efficiency in comparison to conventional delivery systems, while supporting more accessibility, stability and impart ...
*
Self-managed economy
Socialism is a left-wing economic philosophy and movement encompassing a range of economic systems characterized by the dominance of social ownership of the means of production as opposed to private ownership. As a term, it describes the eco ...
*
Transparency (market)
In economics, a market is transparent if much is known by many about: What products and services or capital assets are available, market depth (quantity available), what price, and where. Transparency is important since it is one of the theoretica ...
Notes
Further reading
*
Adler, Jonathan H. “Excerpts from ‘About Free-Market Environmentalism.’” In Environment and Society: A Reader, edited by Christopher Schlottmann, Dale Jamieson, Colin Jerolmack, Anne Rademacher, and Maria Damon, 259–264.
New York University Press
New York University Press (or NYU Press) is a university press that is part of New York University.
History
NYU Press was founded in 1916 by the then chancellor of NYU, Elmer Ellsworth Brown.
Directors
* Arthur Huntington Nason, 1916–1932 ...
, 2017. .
* Althammer, Jörg. “Economic Efficiency and Solidarity: The Idea of a Social Market Economy.” Free Markets with Sustainability and Solidarity, edited by Martin Schlag and Juan A. Mercaso,
Catholic University of America Press
The Catholic University of America Press, also known as CUA Press, is the publishing division of The Catholic University of America. Founded on November 14, 1939, and incorporated on July 16, 1941,Roy J. Deferrari ''Memoirs of the Catholic Univer ...
, 2016, pp. 199–216, .
*
Baradaran, Mehrsa. “The Free Market Confronts Black Poverty.” The Color of Money: Black Banks and the Racial Wealth Gap,
Harvard University Press
Harvard University Press (HUP) is a publishing house established on January 13, 1913, as a division of Harvard University, and focused on academic publishing. It is a member of the Association of American University Presses. After the retirem ...
, 2017, pp. 215–246, .
*
*
*
*
Block, Fred and
Somers, Margaret R. (2014).
The Power of Market Fundamentalism: Karl Polanyi's Critique''
Harvard University Press
Harvard University Press (HUP) is a publishing house established on January 13, 1913, as a division of Harvard University, and focused on academic publishing. It is a member of the Association of American University Presses. After the retirem ...
. . .
* Boettke, Peter J
"What Went Wrong with Economics?", ''Critical Review'' Vol. 11, No. 1, pp. 35, 58
*
*
*
Chua, Beng Huat. “Disrupting Free Market: State Capitalism and Social Distribution.” ''Liberalism Disavowed: Communitarianism and State Capitalism in Singapore'',
Cornell University Press
The Cornell University Press is the university press of Cornell University; currently housed in Sage House, the former residence of Henry William Sage. It was first established in 1869, making it the first university publishing enterprise in th ...
, 2017, pp. 98–122, .
*
Cox, Harvey (2016).
The Market as God'' Harvard University Press. .
*
Cremers, Jan and Ronald Dekker. “Labour Arbitrage on European Labour Markets: Free Movement and the Role of Intermediaries.” ''Towards a Decent Labour Market for Low Waged Migrant Workers'', edited by Conny Rijken and Tesseltje de Lange,
Amsterdam University Press
Amsterdam University Press (AUP) is a university press that was founded in 1992 by the University of Amsterdam in the Netherlands. It is based on the Anglo-Saxon university press model and operates on a not-for-profit basis. AUP publishes scholarl ...
, 2018, pp. 109–128, .
*
*
*
*
*
*
*
*
*
Hayek, Friedrich A. (1948). ''Individualism and Economic Order''. Chicago: University of Chicago Press. vii, 271,
*
* Higgs, Kerryn. “The Rise of Free Market Fundamentalism.” Collision Course: Endless Growth on a Finite Planet,
The MIT Press
The MIT Press is a university press affiliated with the Massachusetts Institute of Technology (MIT) in Cambridge, Massachusetts (United States). It was established in 1962.
History
The MIT Press traces its origins back to 1926 when MIT publish ...
, 2014, pp. 79–104, .
* Holland, Eugene W. “Free-Market Communism.” Nomad Citizenship: Free-Market Communism and the Slow-Motion General Strike, NED-New edition,
University of Minnesota Press
The University of Minnesota Press is a university press that is part of the University of Minnesota. It had annual revenues of just over $8 million in fiscal year 2018.
Founded in 1925, the University of Minnesota Press is best known for its book ...
, 2011, pp. 99–140, .
* Hoopes, James. “Corporations as Enemies of the Free Market.” Corporate Dreams: Big Business in American Democracy from the Great Depression to the Great Recession,
Rutgers University Press
Rutgers University Press (RUP) is a nonprofit academic publishing house, operating in New Brunswick, New Jersey under the auspices of Rutgers University.
History
Rutgers University Press, a nonprofit academic publishing house operating in New B ...
, 2011, pp. 27–32, .
*
* Jónsson, Örn D., and Rögnvaldur J. Sæmundsson. “Free Market Ideology, Crony Capitalism, and Social Resilience.” Gambling Debt: Iceland’s Rise and Fall in the Global Economy, edited by E. Paul Durrenberger and Gisli Palsson,
University Press of Colorado
The University Press of Colorado is a nonprofit publisher supported partly by Adams State University, Colorado State University, Fort Lewis College, Metropolitan State University of Denver, the University of Colorado, the University of Northern Co ...
, 2015, pp. 23–32, .
*
*
Kuttner, Robert, "The Man from Red Vienna" (review of Gareth Dale, ''
Karl Polanyi
Karl Paul Polanyi (; hu, Polányi Károly ; 25 October 1886 – 23 April 1964),''Encyclopædia Britannica'' (Chicago: Encyclopædia Britannica Inc. 2003) vol 9. p. 554 was an Austro-Hungarian economic anthropologist and politician, best known ...
: A Life on the Left'',
Columbia University Press
Columbia University Press is a university press based in New York City, and affiliated with Columbia University. It is currently directed by Jennifer Crewe (2014–present) and publishes titles in the humanities and sciences, including the fiel ...
, 381 pp.), ''
The New York Review of Books
''The New York Review of Books'' (or ''NYREV'' or ''NYRB'') is a semi-monthly magazine with articles on literature, culture, economics, science and current affairs. Published in New York City, it is inspired by the idea that the discussion of i ...
'', vol. LXIV, no. 20 (21 December 2017), pp. 55–57. "In sum, Polanyi got some details wrong, but he got the big picture right. Democracy cannot survive an excessively free market; and containing the market is the task of politics. To ignore that is to court
fascism
Fascism is a far-right, authoritarian, ultra-nationalist political ideology and movement,: "extreme militaristic nationalism, contempt for electoral democracy and political and cultural liberalism, a belief in natural social hierarchy an ...
." (Robert Kuttner, p. 57).
*
*
* Mittermaier, Karl and Isabella Mittermaier. “Free-Market Dogmatism and Pragmatism.” In ''The Hand Behind the Invisible Hand: Dogmatic and Pragmatic Views on Free Markets and the State of Economic Theory'', 1st ed., 23–26.
Bristol University Press
, mottoeng = earningpromotes one's innate power (from Horace, ''Ode 4.4'')
, established = 1595 – Merchant Venturers School1876 – University College, Bristol1909 – received royal charter
, type ...
, 2020. .
* Newland, Carlos. “Is Support for Capitalism Declining around the World? A Free-Market Mentality Index, 1990–2012.” The ''Independent Review'', vol. 22, no. 4,
Independent Institute
The Independent Institute is an American libertarian think tank based in Oakland, California. Founded in 1986 by David J. Theroux, the institute focuses on political, social, economic, legal, environmental, and foreign policy issues. It has more ...
, 2018, pp. 569–583, .
*
Noriega, Roger F., and Andrés Martínez-Fernández. "The Free-Market Moment: Making Grassroots Capitalism Succeed Where Populism Has Failed".
American Enterprise Institute
The American Enterprise Institute for Public Policy Research, known simply as the American Enterprise Institute (AEI), is a center-right Washington, D.C.–based think tank that researches government, politics, economics, and social welfare. ...
, 2016, .
* Orłowska, Agnieszka. “Toward Mutual Understanding, Respect, and Trust: On Past and Present Dog Training in Poland.” ''Free Market Dogs: The Human-Canine Bond in Post-Communist Poland'', edited by Michał Piotr Pręgowski and Justyna Włodarczyk,
Purdue University Press
Purdue University Press, founded in 1960, is a university press that is part of Purdue University. It is a unit of Purdue University Libraries.
History
An administrative unit of Purdue University Libraries, Purdue University Press has its roots ...
, 2016, pp. 35–60, .
* Ott, Julia C. “The ‘Free and Open Market’ Responds.” ''When Wall Street Met Main Street'',
Harvard University Press
Harvard University Press (HUP) is a publishing house established on January 13, 1913, as a division of Harvard University, and focused on academic publishing. It is a member of the Association of American University Presses. After the retirem ...
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Palda, Filip (2011) ''Pareto's Republic and the New Science of Peace'' 201
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*
Philippon, Thomas. “The Rise in Market Power.” ''The Great Reversal: How America Gave Up on Free Markets'',
Harvard University Press
Harvard University Press (HUP) is a publishing house established on January 13, 1913, as a division of Harvard University, and focused on academic publishing. It is a member of the Association of American University Presses. After the retirem ...
, 2019, pp. 45–61, .
*
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Roberts, Alasdair. “The Market Comes Back.” ''The End of Protest: How Free-Market Capitalism Learned to Control Dissent'',
Cornell University Press
The Cornell University Press is the university press of Cornell University; currently housed in Sage House, the former residence of Henry William Sage. It was first established in 1869, making it the first university publishing enterprise in th ...
, 2013, pp. 41–57, .
*
Robin, Ron. “Castrophobia and the Free Market: The Wohlstetters’ Moral Economy.” ''The Cold World They Made: The Strategic Legacy of Roberta and Albert Wohlstetter'',
Harvard University Press
Harvard University Press (HUP) is a publishing house established on January 13, 1913, as a division of Harvard University, and focused on academic publishing. It is a member of the Association of American University Presses. After the retirem ...
, 2016, pp. 118–138, .
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Sandel, Michael J. (2013). ''What Money Can't Buy: The Moral Limits of Markets.''
Farrar, Straus and Giroux
Farrar, Straus and Giroux (FSG) is an American book publishing company, founded in 1946 by Roger Williams Straus Jr. and John C. Farrar. FSG is known for publishing literary books, and its authors have won numerous awards, including Pulitzer ...
. .
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Sim, Stuart. “Neoliberalism, Financial Crisis, and Profit.” ''Addicted to Profit: Reclaiming Our Lives from the Free Market'',
Edinburgh University Press
Edinburgh University Press is a scholarly publisher of academic books and journals, based in Edinburgh, Scotland.
History
Edinburgh University Press was founded in the 1940s and became a wholly owned subsidiary of the University of Edinburgh ...
, 2012, pp. 70–95, .
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Singer, Joseph W. “Why Consumer Protection Promotes the Free Market.” ''No Freedom without Regulation: The Hidden Lesson of the Subprime Crisis'',
Yale University Press
Yale University Press is the university press of Yale University. It was founded in 1908 by George Parmly Day, and became an official department of Yale University in 1961, but it remains financially and operationally autonomous.
, Yale Universi ...
, 2015, pp. 58–94, .
* Sloman, Peter. “Welfare in a Neoliberal Age: The Politics of Redistributive Market Liberalism.” In ''The Neoliberal Age?: Britain since the 1970s'', edited by Aled Davies, Ben Jackson, and Florence Sutcliffe-Braithwaite, 75–93.
UCL Press
, mottoeng = Let all come who by merit deserve the most reward
, established =
, type = Public research university
, endowment = £143 million (2020)
, budget = ...
, 2021. .
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Stiglitz, Joseph. (1994). ''Whither Socialism?'' Cambridge, Massachusetts: MIT Press.
* Symons, Michael. “Free The Market! (It's Been Captured by Capitalism).” ''Meals Matter: A Radical Economics Through Gastronomy'',
Columbia University Press
Columbia University Press is a university press based in New York City, and affiliated with Columbia University. It is currently directed by Jennifer Crewe (2014–present) and publishes titles in the humanities and sciences, including the fiel ...
, 2020, pp. 225–246, .
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* pp. 226–266, .
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*
* Zeitlin, Steve, and
Bob Holman
Bob Holman is an American poet and poetry activist, most closely identified with the oral tradition, the spoken word, and poetry slam. As a promoter of poetry in many media, Holman has spent the last four decades working variously as an author ...
. “Free Market Flavor: Poetry of the Palate.” ''The Poetry of Everyday Life: Storytelling and the Art of Awareness'', 1st ed.,
Cornell University Press
The Cornell University Press is the university press of Cornell University; currently housed in Sage House, the former residence of Henry William Sage. It was first established in 1869, making it the first university publishing enterprise in th ...
, 2016, pp. 127–131, .
External links
"Free market"at ''
Encyclopædia Britannica
The (Latin for "British Encyclopædia") is a general knowledge English-language encyclopaedia. It is published by Encyclopædia Britannica, Inc.; the company has existed since the 18th century, although it has changed ownership various time ...
''
"Free Enterprise: The Economics of Cooperation"looks at how communication, coordination and cooperation interact to make free markets work
{{DEFAULTSORT:Free market
Free-market anarchism
Free-market anarchism, or market anarchism, also known as free-market anti-capitalism and free-market socialism, is the branch of anarchism that advocates a free-market economic system based on voluntary interactions without the involvement of ...
Capitalism
Classical liberalism
Economic ideologies
Economic liberalism
Economic systems
Georgism
Libertarianism
Libertarian theory
Market (economics)
Market socialism
Market socialism
Market socialism is a type of economic system involving the public, cooperative, or social ownership of the means of production in the framework of a market economy, or one that contains a mix of worker-owned, nationalized, and privately owned ...