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OpenMarket: Morality of Capitalism

  • How to Address Income Inequality

    April 11, 2016

    Over at the Foundation for Economic Education, Iain Murray and I give a short preview of our two forthcoming CEI papers on income inequality and poverty relief.

    In the first, “People, Not Ratios: Priorities, Please,” we argue that inequality in itself is not the problem — poverty is.

    Piketty and Krugman’s focus on income inequality treats people like statistics. Instead, we should focus on individuals’ actual standards of living and on ways to empower them — as individuals — to improve their lot.

    In the second paper, “Policies to Help the Poor,” we suggest a policy agenda to make poor and middle-class individuals better off in absolute terms.

    Of course, the elimination of global...

  • Is GE a Capitalist Good Guy or a Corporate Bad Guy?

    April 7, 2016

    General Electric CEO Jeff Immelt has an interesting op-ed today in the Washington Post, hitting back against charges that his company is “destroying the moral fabric” of the country with a culture of corporate greed. The thrust of Immelt’s response is that, unlike politicians, companies like GE “create wealth and jobs, instead of just calling for them in speeches.”

  • Three Economists Had the Answer to the President's Questions

    January 13, 2016

    Last night at the State of the Union, the President asked three questions regarding domestic policy (I’ll leave the foreign policy question to others). They were:

    First, how do we give everyone a fair shot at opportunity and security in this new economy?

    Second, how do we make technology work for us, and not against us – especially when it comes to solving urgent challenges like climate change?

    And finally, how can we make our politics reflect what’s best in us, and not what’s worst?

    These three questions are best answered by three great economists, Joseph Schumpeter, Ronald Coase, and Friedrich Hayek.

  • Much to Be Thankful For

    November 25, 2015

    Thanksgiving is tomorrow, and all of us have much to be thankful for. Over at Inside Sources, I have a Julian Simon-inspired take on the holiday:

    This Thursday is an opportunity to give thanks for a wonderful fact: In all of human history, there has never been a better time to be alive than right now. This might seem an odd thing to say at the moment. War, terrorism, poverty, political repression and hunger still plague many countries. The most recent wounds, inflicted in Paris, Syria, and elsewhere, are still fresh.

    But life is improving in unprecedented ways.

    Over the last century or so, the typical American’s income has grown sixfold. Life expectancy increased 30 years during the 20th century...

  • Thanksgiving: Massachusetts Discovers Property Rights

    November 25, 2015

    Thanksgiving is a day layered in tradition and myth. The standard story makes much of the creative efforts of our ancestors, the assistance provided by the friendly Indians (aka Native Americans) and the richness of the land and seas. That view is romantic, but obscures the fact that over half the original settlers died in the first year, bloody wars between the settlers and the Indians soon dominated the frontier, and that for the first three years, the “bountiful” earth provided little food to the starving colonials.

    The Pilgrims were a highly religious group seeking to live as an extended family in a communal order. Initially they placed all farm lands into a “commons” which all would farm and harvest from collectively. That system goes back to tribal societies with strong cultural rules. Protestant culture, it turned out, ...

  • A Fundamental Misunderstanding of Free Enterprise

    November 23, 2015

    Today, in The Guardian, columnist Zoe Williams repeats an idea often advanced by progressives, that entrepreneurial activity is dependent on the action of others, especially “government,” and that therefore socialism built the iPad. This is contrasted with the idea of human innovation being the result of individual inspiration, which she describes variously as the credo of Thatcher, Reagan, McCloskey, or free markets in general. In doing so, Williams fails the ideological Turing Test; she has fundamentally misunderstood free enterprise economics.

    ...

  • Anti-Capitalism on Campus

    November 20, 2015

    Prof. Brad Thompson of Clemson University writes this week in Minding the Campus on the impact of corporate donations to institutions of higher education. In particular, he describes some of the controversy we’ve seen in recent years about donations from unabashedly pro-capitalist sources like BB&T and the Charles Koch Foundation. The allegedly insidious influence of such funding has even inspired the creation of the activist group “UnKoch My Campus.” Of course, as Casey Given of Students for Liberty has recently pointed out, George Soros ...

  • Calling All Public Choice Scholars

    November 18, 2015

    Earlier this month the Cato Institute generously hosted a small roundtable discussion of CEI’s recent study “Virtuous Capitalism: Why there Is Less Corruption in Business than You Think” by Fred Smith and Ryan Young. Our goal was to solicit comments on and criticisms of the paper’s arguments, and to expose more people to the work of CEI’s Center for Advancing Capitalism.

    The questions that arose during that session were helpful, but we are eager to open the discussion to as wide an audience as possible. Thus, we invite scholars (and students) to submit written responses to the arguments presented in the paper. Economists who work in the realm of public choice theory might be especially interested in engaging with Smith and Young. As they write:

    ...
  • Virtuous Capitalism in Theory and Practice

    November 17, 2015

    Government is responsible for billions and billions of dollars of corruption and corporate welfare. Considering the potential returns on investment compared to honest entrepreneurship, it is a minor miracle the vice-to-virtue ratio in the economy isn’t even worse than it already is. Why is that? CEI founder Fred Smith and I wrote a recent paper, “Virtuous Capitalism,” which explores several possible answers to the question.

    If you don’t have time to read the whole thing, Fred summarizes it in his most recent Forbes column, to which I contributed:

    Capitalism has a bad reputation. Many people see it as corrupt, uncaring, and in bed with politicians. And popular wisdom isn’...

  • Sell a Kidney, Save a Life

    November 2, 2015

    Last week I blogged about the idea that some things should not be part of a market economy, and highlighted one rather silly example of a particular item being outlawed: in that case, futures contracts in onions. But there are far more serious examples of policymakers forbidding commerce in specific goods with disastrous results, in particular human organs like kidneys.

    The same day I wrote about onions, Shmuly Yanklowitz wrote in The Atlantic about the advantages we could see from allowing a market in “compensated donation” of kidneys. Yanklowitz has an unusual perspective, being the founder of a social welfare nonprofit organization as well as someone who has recently given an...

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