Dynamic Capitalism: Entrepreneurship is lucrative--and just

Excerpt from an article by Prof. Edmund Phelps, America's latest Nobel prizewinner



There are two economic systems in the West. Several nations--including the U.S., Canada and the U.K.--have a private-ownership system marked by great openness to the implementation of new commercial ideas coming from entrepreneurs, and by a pluralism of views among the financiers who select the ideas to nurture by providing the capital and incentives necessary for their development. Although much innovation comes from established companies, as in pharmaceuticals, much comes from start-ups, particularly the most novel innovations. This is free enterprise, a k a capitalism.

The other system--in Western Continental Europe--though also based on private ownership, has been modified by the introduction of institutions aimed at protecting the interests of "stakeholders" and "social partners." The system's institutions include big employer confederations, big unions and monopolistic banks. Since World War II, a great deal of liberalization has taken place. But new corporatist institutions have sprung up: Co-determination (cogestion, or Mitbestimmung) has brought "worker councils" (Betriebsrat); and in Germany, a union representative sits on the investment committee of corporations. The system operates to discourage changes such as relocations and the entry of new firms, and its performance depends on established companies in cooperation with local and national banks. What it lacks in flexibility it tries to compensate for with technological sophistication. So different is this system that it has its own name: the "social market economy" in Germany, "social democracy" in France and "concertazione" in Italy.

The American and Continental systems are not operationally equivalent, contrary to some neoclassical views. Let me use the word "dynamism" to mean the fertility of the economy in coming up with innovative ideas believed to be technologically feasible and profitable--in short, the economy's talent at commercially successful innovating. In this terminology, the free enterprise system is structured in such a way that it facilitates and stimulates dynamism while the Continental system impedes and discourages it.

More here. You can find a free-marketeer's evaluation of Phelps here

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ANOTHER PESKY GENETICS FINDING:

Will feminists like being told that women are more apelike than men?

Basically, the point is that, in crossing the little evolutionary distance that exists between chimps and humans, most of the changes occurred in males. In other words, what differentiates us from our mammalian relatives is changes that have occurred in the male of the species.

Actually, this is not news. Evolutionary anthropologists have long been aware of it. As far back as 1972, Elaine Morgan, a feminist, writing in The Descent of Woman, noted that in fact the role of females hadn't changed much from chimp to human. Mothers nurse and care for their offspring in basically the same way chimps do. In terms of social role, there really isn't much difference between human females and other animals.

What has changed is the role of males. Among chimps, males hang out in groups, form alliances, forage together, and do a lot of bickering over status. They do not participate at all in child rearing. By the time hunting-and-gathering tribes arrive, however, men have been folded into the family. Monogamy predominates and both parents participate in child rearing. The extraordinary innovation is "fatherhood," a role that doesn't really exist elsewhere in nature.

More here

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ELSEWHERE

Boycott Porsche: "Prejudices against America are common among German elites in politics, business and the media. America is considered a country devoid of culture, with a capitalistic economic system that shows no regard for "social values". So it's not surprising to hear a CEO of a major German company repeat such trash. What is surprising, though, is the fact that this CEO heads a company deriving most of its sales and profits from catering to the rich in - America. The name of the company is Porsche, and the CEO is Wendelin Wiedeking."

Islamic insanity in Australia: "A religious feud between a Muslim father and his teenage daughter may have sparked a bloody domestic dispute on the Gold Coast which left the man's wife dead and him fighting for life in hospital. Police are investigating suggestions the violence erupted after the 17-year-old girl told her father she wanted to opt out of the Islamic faith and convert to Christianity. The girl's mother is believed to have stepped in to protect her daughter, only to be fatally stabbed with a kitchen knife. Neighbours reported hearing "blood-curdling" screams before the hysterical girl ran half-naked from their Southport home unit covered in scratches. Police later found the body of the girl's mother, 41, inside the blood-smeared unit. Her husband was taken to the Gold Coast Hospital with a stab wound to the chest. He was last night in a critical condition under police guard."

A wise move: "The Pope is taking steps to revive the ancient tradition of the Latin Tridentine Mass in Catholic churches worldwide, according to sources in Rome. Pope Benedict XVI is understood to have signed a universal indult - or permission - for priests to celebrate again the Mass used throughout the Church for nearly 1,500 years. The indult could be published in the next few weeks, sources told The Times. Use of the Tridentine Mass, parts of which date from the time of St Gregory in the 6th century and which takes its name from the 16th-century Council of Trent, was restricted by most bishops after the reforms of the Second Vatican Council (1962-65). This led to the introduction of the new Mass in the vernacular to make it more accessible to contemporary audiences. By bringing back Mass in Latin, Pope Benedict is signalling that his sympathies lie with conservatives in the Catholic Church. One of the most celebrated rebels against its suppression was Archbishop Marcel Lefebvre, who broke with Rome in 1988 over this and other reforms. He was excommunicated after he consecrated four bishops, one of them British, without permission from the Pope. Some Lefebvrists, including those in Brazil, have already been readmitted. An indult permitting the celebration of the Tridentine Mass could help to bring remaining Lefebvrists and many other traditional Catholics back to the fold."

For more postings, see TONGUE-TIED, EDUCATION WATCH, GREENIE WATCH, POLITICAL CORRECTNESS WATCH, GUN WATCH, SOCIALIZED MEDICINE, FOOD & HEALTH SKEPTIC, AUSTRALIAN POLITICS and EYE ON BRITAIN. (Mirror sites here, here, here, here, here, here, here and here).

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"All the worth which the human being possesses, all spiritual reality, he possesses only through the State." -- 19th century German philosopher Georg Wilhelm Friedrich Hegel. Hegel is the most influential philosopher of the Left -- inspiring Karl Marx, the American "Progressives" of the early 20th century and university socialists to this day.

The Big Lie of the late 20th century was that Nazism was Rightist. It was in fact typical of the Leftism of its day. It was only to the Right of Stalin's Communism. The very word "Nazi" is a German abbreviation for "National Socialist" (Nationalsozialistisch)

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