The economic justification for Capitalism

[Joker]

Many people make the argument that capitalism is some sort of "natural" system that cannot be replaced. However, this is nonsense, because in reality Capitalism is a social construct that demands certain rules and regulations for it to function (for example, private property rights, contracts enforceable by law, the commodification of factors of production like Labour etc) None of this is natural, but was introduced through political and historical processes that can be overturned.

Moreover, the economic argument for Capitalism is based on a make-believe model of "perfect competition". In Perfect Competition, there is the assumption that all economic agents have perfect information, there is no market power (i.e. there are an infinitely large number of firms competing against each other, each selling a homogenous product), prices are flexible, and that people are completely rational. It's clear that most of these assumptions are in reality violated, so why do we still believe that Capitalism can work as perfectly as this stylised model suggests?

There are as we speak significant protests against Capitalism all around the world, and I'm glad about that tbh. For too long we've been told that there is no alternative to the current economic system, and that economic theory has proven that Capitalism works, when it reality the theory proves exactly the opposite.

[Coney]

I'm waiting for Cripps' summary.

[Cripps_orig]

I'm waiting for Cripps' summary.

RVPs shit

[Syn]

These sorts of arguments/discussions irritate me. 'Perfect competition' isn't a stylised model for the same reason you said - the data doesn't fit. Nobody uses these simple models you learn at school or university. They can, at best, serve as a starting point. I have worked in regulation where models of competition (including the unrealistic assumptions you're talking about) are adapted; after a series of careful refinements you have something which resembles the structure of a particular industry. Then you make policy proposals. What do you mean the 'theory proves exactly the opposite'? It doesn't. And you can't go anywhere with this discussion because you're using undefined, loose terms like 'capitalism'. What defines whether a set of policies falls into the 'capitalism' category?

Economic theory doesn't propose any ideology is correct. It may propose a normative foundation in which to make decisions under very specific requirements. You first look at the data; role of institutions etc. and then look to adapt.

[Niall_Quinn]

Talk is cheap, either we're killing the board or we aren't killing the board. Everyone make up their minds and let me know.

[PGFC]

Many people make the argument that capitalism is some sort of "natural" system that cannot be replaced. However, this is nonsense, because in reality Capitalism is a social construct that demands certain rules and regulations for it to function (for example, private property rights, contracts enforceable by law, the commodification of factors of production like Labour etc) None of this is natural, but was introduced through political and historical processes that can be overturned.

Moreover, the economic argument for Capitalism is based on a make-believe model of "perfect competition". In Perfect Competition, there is the assumption that all economic agents have perfect information, there is no market power (i.e. there are an infinitely large number of firms competing against each other, each selling a homogenous product), prices are flexible, and that people are completely rational. It's clear that most of these assumptions are in reality violated, so why do we still believe that Capitalism can work as perfectly as this stylised model suggests?

There are as we speak significant protests against Capitalism all around the world, and I'm glad about that tbh. For too long we've been told that there is no alternative to the current economic system, and that economic theory has proven that Capitalism works, when it reality the theory proves exactly the opposite.

Lend us a tenner, go on, I'll give you a score back in a weeks time, promise.

[Letters]

There are as we speak significant protests against Capitalism all around the world, and I'm glad about that tbh. For too long we've been told that there is no alternative to the current economic system, and that economic theory has proven that Capitalism works, when it reality the theory proves exactly the opposite.

The problem is I haven't heard any of the protestors suggest an alternative.
You can't protest against something without saying what you think should happen instead.

[PGFC]

The problem is I haven't heard any of the protestors suggest an alternative.
You can't protest against something without saying what you think should happen instead.

I PROTEST!!

[Letters]

GW isn't a democracy

[Niall_Quinn]

GW isn't a democracy

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