National Free-Market Economy

A National Free-Market Economy is a free-market economy that is a national economy (which follows a free-market ideology based on strong private property laws and contract laws).

• AKA: Capitalistic Country.
• Context:
  • It can range from being a Lightly-Regulated National Free Market-based Economy to being a [Highly-Regulated Capitalistic System]].
  • It can (typically) be a Market-based Economy.
  • It can (typically) be espoused by a Free-Market Economic Ideology (such as within a capitalistic society).
  • It can (typically) lead to Private Ownership of the Means of Production (by capitalists).
  • It can (typically) require Government Intervention (Neal & Williamson, 2014)
  • It can be modeled as a Winner-Take-Most Game.
  • It can tap into Wealth Addiction.
  • It can (typically) focus on Generating Returns.
• Example(s):
  • U.S. Economy.
  • Canadian Economy.
  • German Economy.
  • Japanese Economy.
  • …
• Counter-Example(s):
  • a National Socialist Economy.
  • an National Anarchist Economic System.
  • a National Statist Economic System.
• See: Private Interest, Public Interest.

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References

2015

• http://www.economist.com/news/finance-and-economics/21660549-forecasts-decline-capitalism-are-premature-advancing-not-retreating
  • QUOTE: However, if you define capitalism as the interaction of individuals with a market economy, the system is advancing, not retreating. New-economy websites such as Airbnb and Etsy allow people to earn money in new ways … investors expect most of these companies to be profitable eventually, judging by the valuations they attract.

2014

• (Neal & Williamson, 2014) ⇒ Larry Neal and Jeffrey Williamson, (editors). “The Cambridge History of Capitalism. Cambridge University Press ISBN:1107036941
  • "Review of (Neal & Williamson, 2014).” In: The Economist
  • The editors define capitalist systems as having secure contracts, property rights and markets with flexible prices, and surviving long enough to make big investments worthwhile. … Trade may be instinctive, but the institutions of capitalism are a product of social evolution. The rise of the West seems to have had little to do with local smarts or work ethic. Indeed, some of the earliest capitalist innovations in Italy — like rules on issuing credit — were imported from the Abbasid caliphate … capitalist institutions flourished, especially from the late 17th century. Government intervention went hand-in-hand with growth. … Prussia established universal primary education by 1763, thereby creating a workforce capable of boosting economic development. Non-Western economies struggled, by contrast, often because of Western influence. Mr Allen argues that colonisers saddled Africa with corrupt governments that hindered growth. Farsighted investments were typically neglected in favour of projects dedicated to resource extraction.
    This history emphasises that the capitalism upon which Western wealth was built was not particularly laissez-faire.

• David Graeber.
  • Capitalism does not contain an inherent tendency to civilise itself. Left to its own devices, it can be expected to create rates of return on investment so much higher than overall rates of economic growth that the only possible result will be to transfer more and more wealth into the hands of a hereditary elite of investors, to the comparative impoverishment of everybody else.

• (Piketty, 2014) ⇒ Thomas Piketty. (2014). “Capital in the Twenty-First Century." Harvard University Press. ISBN:9780674369559
  • QUOTE: When the rate of return on capital exceeds the rate of growth of output and income, as it did in the nineteenth century and seems quite likely to do again in the twenty-first, capitalism automatically generates arbitrary and unsustainable inequalities that radically undermine the meritocratic values on which democratic societies are based. There are nevertheless ways democracy can regain control over capitalism and ensure that the general interest takes precedence over private interests, while preserving economic openness and avoiding protectionist and nationalist reactions.

2013

• http://en.wikipedia.org/wiki/Free_market
  • A free market is a market structure in which the distribution and costs of goods and services, wage rates, interest rates — along with the structure and hierarchy between capital and consumer goods — are coordinated by supply and demand unhindered by external regulation or control by government or monopolies. A free market contrasts with a controlled market or regulated market, in which government policy intervenes in the setting of prices. An economy composed entirely of free markets is referred to as a free-market economy.

    Although free markets are commonly associated with capitalism in contemporary usage and popular culture, markets have been advocated by socialists and have been included in various different proposals for market socialism.

• http://en.wikipedia.org/wiki/Capitalism
  • Capitalism is an economic system based on the private ownership of the means of production, with the goal of making a profit. Central elements of capitalism include capital accumulation, competitive markets, and a price system. There are, however, multiple variants of capitalism, including laissez-faire, welfare capitalism, and state capitalism. Capitalism is considered to have been applied in a variety of historical cases, varying in time, geography, politics, and culture. There is general agreement that capitalism became dominant in the Western world following the demise of feudalism.

    Economists, political economists, and historians have taken different perspectives in their analysis of capitalism. Laissez-faire economists emphasize the degree to which government does not have control over markets and the importance of property rights. Others emphasize the need for government regulation, to prevent monopolies and to soften the effects of the boom and bust cycle. Most political economists emphasize private property as well, in addition to power relations, wage labor, class, and the uniqueness of capitalism as a historical formation. The extent to which different markets are free, as well as the rules defining private property, is a matter of politics and policy. Many states have what are termed mixed economies, referring to the varying degree of planned and market-driven elements in an economic system.

    Proponents of capitalism use historical precedent to claim that it is the greatest wealth-producing system known to man, and that its benefits are mainly to the ordinary person. Critics of capitalism associate it with economic instability and an inability to provide for the wellbeing of all people.

    The term capitalism, in its modern sense, comes from the writings of Karl Marx. In the 20th century defenders of the capitalist system often replaced the terms capitalism with phrases such as free enterprise and private enterprise and capitalist with investor or rentier in reaction to the negative connotations sometimes associated with capitalism.

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