1. Variations in Capitalist Economies Capitalism: Content & Form

2. What is capitalism? Definitions by "form" Definitions by "form"  system of private or corporate ownership of capital goods and control over investment vs state ownership & control  free market system vs state command/planning Definitions by "content" Definitions by "content"  social system based on the endless imposition of work as the most fundamental form of social organization  "form" of this imposition may vary

3. Cold War Juxtapositions US & Allies vs Soviet Union & Allies US & Allies vs Soviet Union & Allies "Western" Capitalism vs "Eastern" Socialism "Western" Capitalism vs "Eastern" Socialism  Private investment vs state investment  markets vs planning  e.g., Case & Fair chapter 24 Only "mixed" economies in real world Only "mixed" economies in real world   state enterprises in capitalist economies   markets in socialist economies

4. Markets vs Planning Markets generally portrayed as "free", e.g., independence of buyers & sellers Markets generally portrayed as "free", e.g., independence of buyers & sellers Planning generally portrayed in terms of government plans, e.g., Soviet 5-year plans Planning generally portrayed in terms of government plans, e.g., Soviet 5-year plans BUT: BUT:  buyers & sellers often NOT independent  both buyers & sellers PLAN & seek to manipulate supply on the one side and demand on the other  market can be planning tool, used when useful

5. Non-independence Obvious case: oligopolistic collusion or inter- corporate sales between subsidiaries Obvious case: oligopolistic collusion or inter- corporate sales between subsidiaries  manipulate prices to avoid taxes, maximize overall profits Govt - Corporate Contracts, e.g., Pentagon Govt - Corporate Contracts, e.g., Pentagon  often called the "real" welfare state Labor Market Arrangements between unions & industry, e.g., closed shops, deals cut on wages to eliminate "market" pressures Labor Market Arrangements between unions & industry, e.g., closed shops, deals cut on wages to eliminate "market" pressures

6. Corporate Planning & Markets Corporate planning Corporate planning  extensive, many corporations larger than most countries, thus their planning greater than "central planning" in such countries  planning of supply  who produces how much of what  manipulation of labor supply anti-unionism, unionism anti-unionism, unionism immigration policy, practice immigration policy, practice  planning of demand --through manipulation of advertising, mass media, ideology, etc.

7. Govt manipulation of Markets State has often accorded monopolies State has often accorded monopolies Pentagon orchestrates oligopoly in defense industry Pentagon orchestrates oligopoly in defense industry Federal immigration policy "plans" labor supply Federal immigration policy "plans" labor supply Federal policy on collective bargaining "plans" role of labor markets Federal policy on collective bargaining "plans" role of labor markets Federal manipulation of Agricultural markets, e.g., early 1970s, constrict supply, expand demand to raise prices to increase value of exports Federal manipulation of Agricultural markets, e.g., early 1970s, constrict supply, expand demand to raise prices to increase value of exports

8. Market = planning tool So, we see "markets" being allowed to function "automatically" when they give the desired results So, we see "markets" being allowed to function "automatically" when they give the desired results  "automatically" = manipulated only by participants But Markets are manipulated by state, or state allows actors greater freedom to manipulate markets to achieve desired results But Markets are manipulated by state, or state allows actors greater freedom to manipulate markets to achieve desired results Or, markets simply abolished and result dictated by state with or without collusion of participants Or, markets simply abolished and result dictated by state with or without collusion of participants

9. Private Sector Private sector = business (+ ???) Private sector = business (+ ???) Legal organization= forms of ownership Legal organization= forms of ownership  proprietorship - indiv. liability  partnership - shared liability  corporation - limited liability, ersatz individual Industrial "organization" Industrial "organization"  market form (monopoly - perfect competition)  actual organization of production

10. Actual Organization Industrial "structure" a la Case & Fair, ch.3 Industrial "structure" a la Case & Fair, ch.3  manufacturing , services , finance  Industrial "structure" Industrial "structure"  skilled craftspersons  Taylorism - scientific management - deskilling  Fordism - deskilled workforce - assembly line  Putting out - Big complexes of plants - "diffused factory" - electronic cottage

11. Public Sector Public sector = government Public sector = government Government (1994) Government (1994)  federal = 22.8% of GDP  state & local = 10.7% of GDP Government income = f(taxes) = T Government income = f(taxes) = T Government expenditures = G Government expenditures = G Structure? Structure?  state enterprises, R & D, trade, foreign affairs, war  G c + G I

12. Global Structure 1st, 2nd & 3rd Worlds 1st, 2nd & 3rd Worlds East - West East - West North - South North - South Hierarchy Hierarchy Network Network Note: "Macroeconomics" still very "nation" oriented, trade brought in later, no "global" economics. Note: "Macroeconomics" still very "nation" oriented, trade brought in later, no "global" economics.

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