by Michael Munger
In Is Capitalism Sustainable? Michael Munger (Senior Fellow at the American Institute of Economic Research) explains the benefits, and in fact the necessity, of capitalism in organizing human cooperation at scale, and urges the consideration of some problems inherent in capitalism.
Karl Marx called some of these problems “contradictions,” and while he was wrong about many things, including a value theory based on embodied labor, his perceptions of capitalism were very accurate.
The problem for Marxists is simple, Munger says in Is Capitalism Sustainable? : every flaw in markets is worse under socialism. At the micro level, every flaw in consumers is worse, and in fact much worse, in voters. Unless you are willing to advocate monarchism, or actual communist dictatorship, markets and democracy are the only two mechanisms we have for organizing society.
So while Marx’s theory about the flaws of capitalism has some merit, he was utterly blind to the problems of democracy. Looking back now, with the benefit of the contributions of the Public Choice branch of political economy, we are in a position to evaluate markets and democracy on an even playing field.
And most of the time, for most purposes, capitalism wins.
Relevant Links
- Podcast in which Munger talks with EconTalk host Russ Roberts about whether real capitalism is unstable and leads inevitably to crony capitalism.
- Three posts by Munger at the website of the American Institute for Economic Research:
- "Is Capitalism Sustainable?", 17 March 2019
- "Capitalism in Three Principles", 24 April 2019
- "Every Flaw in Markets Is Worse Under Socialism", 22 July 2019
The links in the table of contents below are to more posts by Munger that correspond to the chapter/section titles.
Table of Contents of Is Capitalism Sustainable?
- General Introduction
Introduction: Is Capitalism Sustainable?
- Capitalism Is Fragile
- Is Capitalism Worth Saving?
- Why You Can't Just "Reject" Capitalism
- Anti-Market Atavism Explained
The Origins of Rules and the Problem of Knowledge
- The Secret History of Tamales Offers a Lesson in Humility
- Pave the Muddy Paths
- More or Better Rules Will Not Save Us
- The Best Rules Are Those You Can't Write Down
- What Can and Cannot Be Planned
- Car Crashes and Hockey Fights - How Safety Mandates Can Make Life More Dangerous
The Argument for Capitalism
- Everybody Loves Mikey
- Capitalism, Not Morality, Ended Baseball's Color Line
- Three Undeniable Problems with Anti-Gouging Laws
- Your Ticket to Capitalism Is Free
- We Can Never Run Out of Anything
- They Clapped: Can Price-Gouging Laws Prohibit Scarcity?
Core Concepts
- I'm Thankful for Division of Labor
- I'll Stick with These: Some Observations on the Division of Labor
- The Lighthouse Myth
- Bosses Don't Wear Bunny Slippers: If Markets Are So Great, Why Are There Firms?
- Rent-Seek and You Will Find
- A Fable of the OC
- Orange Blossom Special: Externalities and the Coase Theorem
In Defense of Profit
- It's Profit, Not Greed, That Is Good
- Distribution in Markets Is Always Just
- Market Makers or Parasites?
- The Origin and Meaning of Profits
General Problems of State Action
- It's Not Only about Markets vs. the State
- Government Is Not What Makes a Country Great
- The Welfare State Is a (Bad) Polygamist
- Truthiness and the Origins of "Fake News"
- Why a Canadian City Tore Down the Staircase Its Residents Had Always Wanted to Build
- Tragedy of the Malecon: Is Cuba "Domestic" Politics?
- Planning Order, Causing Chaos: Transantiago
- We Should DO Something!
- The First Rule of Wing-Walking
Problems with Expertise and Voting in Democracy
- Arthur Pigeou Warned of the Failures of Government
- Brexit Illustrates Why Voting Is One of the Worst Ways to Make Decisions
- The Thing Itself
- Every Flaw in Consumers is Worse in Voters
- Democracy Is a Means, Not an End
- Think Globally, Act Irrationally: Recycling
- Why Population Predictions Bomb
The Future, and Making Things Work
- Capitalism Saved Sweden
- Why We Can't Break Up with Our Stuff - Yet
- Two Steves and One Soichiro: Why Politicians Can't Judge Innovation
- Permissionless Innovation: The Fuzzy Idea that Rules Our Lives
- Will Reducing Transaction Costs Be the End of Retail?
- The Revolutionary Economic Achievement of Platforms
- Directionalism vs. Destinationalism
Conclusion
About Michael Munger
Michael Munger is a Professor of Political Science, Economics, and Public Policy at Duke University. His Economics PhD was awarded from Washington University in St. Louis in 1984. He worked as a Staff Economist for Dr. Wendy Gramm at the Federal Trade Commission in the first Reagan Administration, and has had academic appointments at Dartmouth College, University of Texas-Austin, and University of North Carolina-Chapel Hill. He directed the MPA Program at UNC, and chaired the Political Science Department at Duke from 2000 to 2010. He currently directs the interdisciplinary Philosophy, Politics, and Economics Program at Duke. His research interests include regulation, political institutions, and political economy. Munger is a Senior Fellow of the Independent Institute and the AIER, and is a former President of the Public Choice Society (1996-1998). He served as an editor of Public Choice (2005-2010) and Independent Review (2015 to present).
