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Skeptics cite two main grounds for doubt. The first is human nature: surely people are simply too selfish, greedy and tribal for communal reciprocity to work on a massive scale. Treating your actual brothers as brothers is one thing; treating total strangers as brothers is quite another. Socialists reply that human nature is complex. We are indeed greedy and competitive, but so too are we generous and cooperative. Economic context powerfully influences which of these traits predominate.

Edward Bellamy, an influential 19th century American socialist novelist and thinker, compares human nature to a rosebush Ch. Put a rosebush in a swamp, and it will appear sickly and ugly. But this would be a mistake. We know that rosebushes are capable of great beauty, given the right developmental conditions. Yet surely, argues Bellamy, the same goes for human beings. Shaped by capitalism, people appear greedy, cramped, and fearful. Put us in the more hospitable soil of socialism and we, like the rosebush, would blossom; we would display all the fellow-feeling, generosity, and cooperative instincts socialism requires.

Human nature, in short, poses no serious obstacle to socialism. But these social conditions simply cannot emerge, for they are infeasible: this is the second skeptical objection. Without markets, economies simply do not function tolerably well—witness the failure of Soviet-style planning. In response, Cohen argues that this is just one data point. It would be overly hasty to write off all non-market alternatives simply on the basis of one failed experiment.

They do not now know how to power an economy on generosity and fraternity rather than greed or fear. But design problems often turn out to be solvable with enough ingenuity and attention. Non-market socialists do not currently have the answers. But in the fullness of time, they might—or so Cohen argues. Jason Brennan points out that socialism cannot lay claim to communal reciprocity by definitional fiat. Socialism is just communal ownership of the means of production. If Cohen were right, then we should expect to see an inverse relationship between markets and various pro-social attitudes and behaviors.

We should expect to see greater levels of greed, mistrust, and so on as markets expand and deepen. The most marketized societies should also be the most anti-social. But this is not at all what we find. In fact, we find precisely the opposite. Studies cited by Brennan suggest that market exchange promotes various pro-social attitudes such as trust, fairness, and reciprocity. Brennan concludes that Cohen has it backwards: if we wish to spread camping trip values across society, we should embrace markets, not reject them.

It does not undermine and indeed actually provides some support for market versions of the same. Market socialism is discussed further in 8. This article has not said very much about equality as a socialist ideal. This may surprise some readers. The reductio fails because socialists do not advocate equality of condition, at least not in any straightforward sense. Much light has been shed on this issue by the now-voluminous philosophical literature on egalitarianism.

Of particular import is the work by philosophers like Richard Arneson and G. Insofar as leftists seek equality, what is it that they wish to equalize? Standard options include 1 resources, 2 welfare, 3 opportunities for resources, and 4 opportunities for welfare. Most philosophers agree that the first two options are non-starters. Equalizing outcomes as 1 and 2 would do improperly ignores personal choice and responsibility.

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Stipulate that both bugs know that winter is coming, and that both have the capability, that is, the effective freedom, to build a house and to gather adequate supplies. That is to say, both have equal opportunity to provision themselves. Yet only industrious ant chooses to use this opportunity; carefree grasshopper decides to dance and play instead. Fast forward to winter: there sits ant in his house, warm and well-fed, while grasshopper shivers hungrily outside. Now, no matter which metric we use—resources or welfare—ant is clearly much better off than grasshopper.

Between the two bugs, a very significant inequality of condition obtains. But does this inequality constitute an injustice? Circumstantially, the bugs were identically placed. Both could have prepared for winter. But only ant chose to do so. Then it would be unjust for him to go without food or shelter. For that outcome would reflect factors beyond his control, namely, his unchosen disability, in violation of the luck egalitarian standard. Opportunities for resources, welfare, or whatever must be equal.

But outcomes may be unequal provided that these inequalities are due to choices rather than circumstances. It might, however, signal a different moral defect: namely, a breech of community or compassion. Socialists aspire to a social world within which people care about and when necessary care for one another. Dramatically different living conditions put this regime of mutual comprehension, concern, and caring in jeopardy.

The two bugs would come to dwell in different worlds. Whatever fellow-feeling or mutual concern previously marked their relations would vanish, leaving only a gulf of indifference and estrangement. This is no way for socialist comrades to live: not because it would be unjust by hypothesis, it would not but because it would be insufficiently fraternal and compassionate. On this line, it would be just , but not justified , for ant to bar his door.

Are we back to the Harrison Bergeron reductio , then? Does socialism implausibly require absolute equality of condition after all? No, for two reasons. First, not all inequalities undermine community. Perhaps ant must, in the name of community, provide grasshopper with some of his food and shelter. But does community require him to split his possessions down the middle? Surely not. The point is that while extreme inequalities may place community under strain, more modest ones might not.

Second, Cohen declares, without much argument, that the demands of community trump those of justice. But this ranking may be contested. Perhaps just inequalities should sometimes be allowed to stand even if they undermine community. What, in practice, would a socialist society actually look like? What concrete institutions and policies—political, economic, and social—would it use to organize, motivate, and direct economic activity? It is difficult to assess the desirability of socialism without answering these questions.

The normative case for socialism depends, at least in part, on the attractiveness and feasibility of its institutional vision. More prosaically: even if one is convinced of the abstract philosophical arguments canvassed in section 4, one still has to know what socialism would really be like in order to tell whether one wants it. All three models, being socialist, reject private ownership of the means of production in favor of social ownership. But beyond this important point of commonality, many significant differences emerge, especially concerning a whether planning should be centralized or decentralized, and b the appropriate role of markets in a socialist economy.

Political authorities at the top of this hierarchy decide on broad economic objectives—build up heavy industry, satisfy consumer preferences, develop a backward region, and so on. Central planners then generate a concrete plan to achieve these objectives. To this end, they first gather a massive amount of information. Tens of thousands of enterprises inform planners of their productive capabilities and input requirements; millions of consumers communicate their consumption preferences. Factory A, produce X shoes; factory B, produce Y amount of steel, and so on.

The center sends these orders to enterprise managers, who then devise more specific labor processes through which their workers produce the ordered goods in the right way at the right time. What is to be said in favor of central planning? In theory, quite a bit. Or so the story goes. However, critics allege that in practice central planning performs poorly.

There are two problems worth pulling apart here. The first is economic. Although centrally planned economies eliminate the worst forms of poverty, they do not produce generalized affluence. Under central planning, innovation is sluggish. Product quality is low. Shortages and hoarding are common. Work effort is lacking.

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These defects stem from underlying information, calculation, and incentive problems. Central planners, critics argue, cannot know what people want, or what producers are able to produce, with sufficient accuracy; nor, even if they could, would they be able to use this massive quantity of information to calculate a coherent overall plan; nor, even if they could calculate such a plan, would they be able to incentivize managers and workers to follow it faithfully.

The second problem with central planning is normative.

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Information flows up the hierarchy; orders flow down. Central planners decide; everyone else obeys. It is partly because central planning alienates and disempowers workers that it performs so poorly qua economic system. Workers, so treated, expend little effort at work, ignore orders, under-report their productive capabilities, over-report their output, and so on. But if they reject central planning, what do they propose to put in its place? There would seem to be only two options: either socialists rehabilitate planning by decentralizing and democratizing it, or they make peace with the market.

The next two subsections explore these models in greater detail. We may move quickly through the first and fourth of these proposals. What does bear on the distribution of income in a parecon is effort and sacrifice The underlying rationale here is luck egalitarian see 7. People, Albert and Hahnel argue, should be rewarded or penalized only for those things under their control.

But the only thing that people control is their level of effort and sacrifice. Therefore, they should be rewarded and penalized only for their level of effort and sacrifice. There is an exception here: people who are unable to work will be provided with an average income. Democratic workplaces.

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This norm implies that decisions affecting only a given individual should be left entirely to that individual. But other decisions have broader consequences, and are therefore appropriate objects of democratic choice. Some workplace decisions will be entirely up to individual workers; others, assigned to work-teams; still others, to the enterprise as a whole. More will be said about this system of democratic council coordination below.

Balanced job complexes. This is, of course, very far from how occupations are structured currently. Under capitalism, considerations of profit and class power largely determine the way in which different productive tasks are bundled into jobs. The result is a division of labor that assigns routine, boring, disempowering but profitable work to the many, while reserving varied, complex, empowering work for the privileged few.

Parecon rejects this inequitable division. It does so on grounds of fairness: why should interesting and enjoyable work be hoarded by some rather than shared by all? Any workplace with, say, janitors and managers will be a de facto hierarchy, even if it is, on paper, democratically organized.

This brings us to feature 5: economic coordination through councils. Every economy must decide what gets produced and consumed, and in what quantities. This is the problem of allocation. Market systems solve this problem through decentralized, voluntary, self-interested competition and exchange between buyers and sellers. Centrally-planned economies solve the allocative problem by handing it over to a small group of economic elites, who craft a comprehensive plan for the entire economy and issue binding instructions for realizing it. Moscow decides that X amount of shoes will be produced, Y amount of steel, and so on, and enforces these demands on lower levels in the economic hierarchy.

Parecon rejects both approaches. In place of markets and central planning, it proposes a system of nested worker and consumer councils, through which individuals cooperatively generate an overall plan for production and consumption. Simplifying greatly, its basic gist is this. To figure out what people want to consume, we ask them. To figure out what they are willing to produce, we ask them. We then aggregate all these responses and compare proposed supply with proposed demand. Through such negotiation, we eventually reach, say, five feasible plans. We put them to a vote and implement the winner.

Decentralized participatory planning thus promises to solve the allocative problem without hierarchy or markets. The IFB initiates the planning process by announcing provisional prices for all inputs and outputs. Albert and Hahnel see this as a key difference with market systems. In a parecon, prices will accurately track the true social costs of production. Prices rarely do this in market societies. Think, for instance, of the absurdly low price of gasoline in the United States, despite the ecological and economic costs of its widespread production and use.

With these provisional prices in hand, each economic actor—individuals and councils and federations of councils—proposes both a a consumption plan and b a production plan. The former specifies what the actor would like to consume during the period being planned the upcoming year, say ; the latter specifies which outputs the actor proposes to produce, and the inputs they will require to do this. Plans will go to appropriate councils for approval. Thus, a family might submit their consumption plan to the neighborhood consumption council, while a worker might submit her plan to her work-team or to the larger workplace council.

On what basis are proposals approved or rejected? Turning to production proposals, these are evaluated by comparing the estimated social benefits of the goods and services produced with the estimated social costs of producing them. If this ratio is positive, then the production proposal should be accepted; if it is negative, then the proposal does not represent a responsible use of societal resources, and it is sent back for revision.

The IFB aggregates all approved proposals and determines whether projected supply matches projected demand. So the IFB recalculates prices in light of the mismatch between supply and demand, raising prices for goods with excess demand, lowering prices for those with excess supply, and sends the plans back to their originators for revision. Using the new prices, consumers and producers tweak their proposals, perhaps shifting demand to lower-priced goods and increasing supply of goods with high prices. They then send these revised proposals to the relevant councils, which evaluate them as before.

Eventually, all approved proposals make their way to the IFB, which recalculates overall supply and demand to see if they match. If the process ends with multiple feasible plans, then society votes to determine the winner. This is, to be sure, an incredibly complex procedure, indeed, much more complex than this brief sketch indicates.

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Even Albert and Hahnel admit that it will take multiple rounds of negotiation, and no small amount of paperwork, to arrive at a feasible plan. And this, notice, without markets or central planning :. There is no center or top. There is no competition. Each actor fulfills responsibilities that bring them into greater rather than reduced solidarity with other producers and consumers. Everyone is remunerated appropriately for effort and sacrifice. And everyone has proportionate influence on their personal choices as well as those of larger collectives and the whole society Albert The absence of hierarchy is worth emphasizing.

No one occupies any special position of authority. Economic decisions are not dominated by the wealthy as under capitalism or the politically connected as under central planning. Instead, all economic decision-making is radically democratic and open to negotiation: each person has a say over decisions that affect him or her, proportional to the degree to which he or she is affected.

Parecon may have important flaws, but inadequate respect for democratic values would not seem to be among them. Indeed, it is hard to imagine a system more faithful to the core socialist commitment to bottom-up, democratic control over the economy. This, surely, is parecon's chief virtue from the socialist perspective. The information complexity of the iterated planning process described in Parecon might in the end simply overwhelm the planning process.

Albert is confident that with appropriate computers…this would not be a problem…Perhaps he is right. But he may also be horribly wrong. As described…the information process seems hugely burdensome Defenders of parecon reply to such worries in several ways. First, they argue that critics overestimate the amount of planning that parecon requires.

But with that initial investment made, planning in subsequent years should be much quicker. One can simply base future plans off of the original one, tweaking here and there as necessary. Nor need one specify in great detail what one wants to consume. Of course, critics may find new grounds for concern here. If people do not request specific items, then many desired items will be in short supply, and consumer satisfaction will be low.

Second reply to the infeasibility worry: we must remember that other economic systems require paperwork and planning, too. Under market socialism and capitalism consumers must make budgets, do their taxes, pay bills, go shopping, and so on. Enterprises must decide what they will make and in what quantities. They must also make various personnel decisions, deciding who will work with whom, for how long, on which projects, and so on. Added up over the course of the year, the amount of time spent on such activities is far from trivial. Indeed, one might argue that total planning time will be roughly constant across market- and participatory-planning-based systems.

Finally, suppose that parecon does require a substantial amount of time and energy, or perhaps, more time and energy than alternative systems. Still, these costs must be judged against the potential benefits. Parecon promises a more equal, fraternal, just, democratic society. Is it even remotely reasonable to reject such a society on the grounds that it requires too much paperwork? Suppose one rejects central planning, but also doubts the feasibility or perhaps even the desirability of parecon-style participatory planning. Must one therefore reject socialism?

On the traditional view, socialists must, by definition, be opposed not simply to private property, but also to markets. Market socialists disagree. On their view, socialism requires only a certain form of ownership, namely, social rather than private ownership. About markets, socialists should be open-minded. Markets are just tools for communicating information and motivating economic activity.

Like any tool, they should be evaluated instrumentally. Do they work better than alternatives? If so, then socialists should embrace them. And indeed, market socialists characteristically argue that markets do work better than the alternatives: just look at the economic record. Market regulations are integral to the market socialist vision. Market socialists are no kind of market fundamentalists. Rather, they view themselves as pragmatists. They see the evils of capitalism, but they also see the problems with planning-based socialist alternatives.

The way forward, they argue, is to take the good parts of capitalism and combine them with the good parts of socialism. This will displease fundamentalists on both sides, but what alternative is there? Capitalism is a moral disaster.

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Central planning was worse. Participatory planning is a pipe dream. There is no other way. Or so market socialists argue. For other important developments of market socialism, see Roemer , Miller , and Carens Boiled down to essentials, ED has three main features: worker self-management, the market, and social control of investment.

Workers together decide all aspects of production: what to make, how to make it, workplace policies, compensation, and so on. This does not preclude the use of managers or experts. In large firms especially, some delegation of authority will almost certainly prove necessary. The market. In stark contrast with planning-based forms of socialism, ED solves the problem of allocation using market competition between profit-seeking enterprises. They use this money to buy productive inputs on the market, which they transform into commodities.

Prices are determined mainly by market forces of supply and demand, although price regulations may sometimes be appropriate: again, Schweickart is no market fundamentalist. Indeed, turning a profit is the immediate aim of production in ED : enterprises produce to make money, not primarily to satisfy human needs. This may sound rather close to capitalism, but in fact there is an important difference here. Under capitalism, profits go to owners, not workers, who receive wages.

In theory they could split it equally. But given the need to outcompete other enterprises—hence, to attract and retain skilled labor—some degree of inequality is likely to be chosen. More productive workers, or workers with skills in higher demand, will almost certainly earn more than their fellows. Empirical evidence suggests that self-managed firms like those in the Mondragon cooperative in Spain opt for a 4 or ratio between the incomes of the highest- and lowest-paid employees: quite a dramatic difference from the spread typical in large capitalist corporations.

Social control over investment. In an ED, the means of production belong to all members of society, not to the enterprises that happen to deploy them. To reflect this social rather than sectional or private ownership, all enterprises must pay a capital assets tax. Revenues from this tax constitute the national investment fund, which is the sole source of investment money in ED. By tweaking the tax rate, society can determine the size of the national investment fund—hence, the amount of money available for investment, and thus the overall level of economic growth and development.

Note the contrast with capitalism: under capitalism, most investment comes from private rather than public sources. Both the amount and direction of economic development therefore depend on the whims and abilities of private investors. This leads to the boom and bust cycle discussed in section 3, as well as other pathologies such as excessive growth, ecological devastation, underdeveloped regions alongside overdeveloped ones, unemployment, poverty, and all the rest. Under ED, by contrast, investment is democratically controlled by all members of society. How, specifically, should social control over investment be institutionalized?

There are many options. For example, the planning board might decide to prioritize renewable energy, or consumer goods, or whatever. At the other extreme, society might prefer a laissez-faire model in which funds are channeled through public banks to enterprises using essentially the same criteria that capitalist banks use: namely, profitability. In this version of ED, market forces would largely determine the pattern of investment. Schweickart himself proposes something in the middle of these two options.

Funds should go to regions for example, Texas and communities for example, Fort Worth on a per capita basis. If the Fort Worth region has the same population as Silicon Valley, then it will receive the same amount of investment. In ED, then, there will be no economic backwaters, no regions or communities left behind.

Once distributed to regions and communities on a per capita basis, investment funds are channeled to regional and community enterprises by public banks. Enterprises in need of investment say, to expand production apply to area banks for funds. Banks assess applications on the basis of a profitability, b job creation, and c any other democratically chosen criteria, such as ecological impact. This mixed standard implies that while profitability matters, it is not all that matters.

Projects that further socially chosen goals may be chosen over more profitable, but less socially desirable alternatives. We get markets and profit-seeking enterprises, but also workplace democracy and social control over investment. The result, Schweickart argues, is an economy that outperforms all rivals—whether socialist or capitalist—in terms of values dear to socialist hearts, such as equality, economic stability, human development, democracy, and environmentalism.

Perhaps it would really work, but would it be socialism? That his proposal would work—that it is feasible—seems relatively uncontroversial. Markets work. Self-managed enterprises work, as illustrated by decades of empirical evidence. Granted, neoclassical economists will complain that because ED regulates and interferes with markets in various ways, it sacrifices efficiency.

Better to sacrifice some efficiency, Schweickart would argue, for gains in employment, more equitable development across regions, greater democratic empowerment at work, and so on. So all things considered, market socialism seems eminently feasible. This is perhaps its greatest selling point.

But is it desirable? Critics right and left will argue that it is not. Those on the right will complain that ED limits basic economic freedoms, such as the formal freedom to own the means of production, to hire wage labor, and to run a business in a un-democratic fashion. Market socialists will reply that not all formal freedoms are worth protecting.

They will further suggest that ED will enhance effective economic freedom for the vast majority, even if this means diminishing economic freedom, both formal and effective, for those elites who would, absent ED, enjoy greater workplace control and authority. Under capitalism, most workers control no productive property and enjoy no real say over their work. Economic power is monopolized by a tiny class of owners. Under ED, by contrast, economic hierarchies are flattened. Economic power within the enterprise is distributed equally to all workers on a one worker, one vote basis.

Consequently, everyone has the effective freedom to shape workplace decisions. Seen from this angle, ED enhances rather than reduces economic freedom. Market socialism attracts critical fire from the left as well as the right. It is a strange form of socialism indeed, leftist critics will argue, that features anarchic market production for profit rather than planned production for use. With markets and profits come competition, greed, fear, and the diminution of community; with markets and profits come consumerism, ever-expanding hours of work, and the ecologically insane desire for never-ending economic growth.

Schweickart replies that these worries are overblown. Yes, ED features competition; yes, there will be advertising and some degree of consumerism; yes, enterprises may, under certain circumstances, seek to grow. But the details make a difference. Competition, consumerism, and economic growth are all held in check in ED by countervailing forces. Social control over investment means that we can democratically determine the overall rate and direction of economic growth.

We can prioritize environmental aims, for instance, over the rapacious quest, so characteristic of capitalism, for additional output at whatever cost. Workplace democracy means that we can choose shorter working hours in exchange for reduced consumption opportunities. Moreover, because democratic firms seek to maximize profit per-worker rather than total profit, as do capitalist firms , they will not expand as aggressively as their capitalist counterparts. But reduced expansion means less output that needs to be sold, which, in turn, reduces demand for advertising and marketing.

In short, for all of these reasons ED is absolutely compatible with the socialist vision of a less-consumerist, more leisurely, ecologically sane world, or so defenders of market socialism would argue. Indeed, market socialists would draw a more general lesson here. From the fact that markets in a capitalist context lead to undesirable effects X, Y, or Z, we cannot automatically infer that they would lead to X, Y, or Z in the dramatically different political-economic framework of market socialism.

The only way to tell, insist market socialists, is to work carefully through the details. Samuel Arnold Email: s. Socialism Socialism is both an economic system and an ideology in the non-pejorative sense of that term. Communism in Marxist Thought Why Socialism? Economic Considerations Why Socialism? Democracy Scope Influence Why Socialism? Community and Equality Why Produce? Communal vs. Socialism and Capitalism: Basic Institutional Contrasts Considered as an economic system, socialism is best understood in contrast with capitalism.

Capitalism designates an economic system with all of the following features: The means of production are, for the most part, privately owned; People own their labor power, and are legally free to sell it to or withhold it from others; Production is generally oriented towards profit rather than use: firms produce not in the first instance to satisfy human needs, but rather to make money; and Markets play a major role in allocating inputs to commodity production and determining the amount and direction of investment.

Private, State, and Social Ownership To understand socialism, one must distinguish between three forms of ownership. The core idea here is well expressed by Michael Harrington: Socialization means the democratization of decision making in the everyday economy, of micro as well as macro choices.

But if this is what genuine socialization requires, then socialism is not a formula or a specific legal mode of ownership, but a principle of empowering people at the base, which can animate a whole range of measures, some of which we do not yet even imagine Harrington, Economic Systems as Hybrids In principle, an economy could be wholly capitalist, statist, or socialist. Socialism vs. Communism in Marxist Thought Although this article focuses on socialism rather than Marxism per se , there is an important distinction within Marxist thought that warrants mention here.

Like capitalism, socialism does not overcome scarcity. Under socialism, the social surplus increases, but it is not yet sufficiently large to cover all competing claims. The state. Socialism transforms the state but does not do away with it. Since workers make up the vast majority, this is less authoritarian than it sounds. Workers must seize the state and use it to implement, deepen, and secure the socialist transformation of society.

The division of labor. Socialism, like capitalism, will feature occupational specialization. Having developed under capitalist educational and cultural institutions, most people were socialized to fit narrow, undemanding productive roles. Accordingly, socialism must feature a broadly inegalitarian occupational structure. Finally, under socialism many people will retain certain capitalist attitudes about production and distribution.

For example, they expect compensation to vary with contribution. Since contributions will differ, so too will rewards, leading to unequal standards of living. They work, in short, to get paid, rather than to develop and apply their capacities or to benefit their comrades. Or, as Engels famously puts this point in Socialism: Utopian and Scientific , State interference in social relations becomes, in one domain after another, superfluous, and then dies out of itself; the government of persons is replaced by the administration of things, and by the conduct of processes of production.

Why Socialism? Economic Considerations Is socialism worthy of allegiance, and if so, why? Democracy The article turns now to the normative case against capitalism and in favor of socialism, starting with democracy. Scope To see this argument, consider first the scope dimension of democracy, which concerns the question: where should the boundary between public and private, between politics and civil society, be drawn?

Many socialists endorse something like the following principle: All Affected Principle: People affected by a decision should enjoy a say over that decision, proportional to the degree to which they are affected. Eliminating Exploitation How exactly is socialism supposed to eliminate exploitation? Freedom and Human Development Many socialists point to considerations of freedom, broadly understood, to support socialism over capitalism.

Formal Freedom It is sometimes suggested that socialism fares poorly with respect to formal freedom. Socialists score this particular fight a draw. Effective Freedom Whereas socialists tend to play defense regarding formal freedom, they go on offense when discussing effective freedom. Community and Equality Capitalism is competitive and cut-throat; socialism is cooperative and harmonious. Why Produce? Justice, Inequality, Community This article has not said very much about equality as a socialist ideal.

Institutional Models of Socialism for the 21st Century What, in practice, would a socialist society actually look like? Proposals 2, 3, and 5 require more extensive discussion. Allocation in Parecon: Economic Coordination Through Councils This brings us to feature 5: economic coordination through councils. Evaluating Parecon This is, to be sure, an incredibly complex procedure, indeed, much more complex than this brief sketch indicates. And this, notice, without markets or central planning : There is no center or top. But would it work? Some commentators are skeptical.

Erik Olin Wright writes: The information complexity of the iterated planning process described in Parecon might in the end simply overwhelm the planning process. Market Socialism Suppose one rejects central planning, but also doubts the feasibility or perhaps even the desirability of parecon-style participatory planning. Evaluating Economic Democracy Perhaps it would really work, but would it be socialism? References and Further Reading Albert, Michael. Parecon: Life After Capitalism. London: Verso, Albert, Michael, and Robin Hahnel.

South End Press, Arneson, Richard. Bellamy, Edward. Looking Backward. Dover, []. A utopian novel, widely acclaimed in its day, depicting political, economic and social arrangements in socialist Boston, some years after a successful revolution. Braverman, Harry. New York: Monthly Review Press, []. Important Marxist analysis of work, according to which the imperatives of profit-maximization force capitalists to simplify and routinize labor processes, thereby degrading work. Brennan, Jason.

Why Not Capitalism? New York: Routledge, A sharp parody of and rejoinder to G. Carens, Joseph. Chicago: University of Chicago Press, Describes a market socialist economic system that—unlike capitalist and non-market socialist alternatives—fully realizes the values of equality, freedom, and economic efficiency. Cohen, G. Argues that workers are individually free since they are not forced to work for capitalists but not collectively free since few workers can escape proletarian status at any given time. Oxford: Clarendon Press, Important statement of luck egalitarianism.

Expanded edition. Why Not Socialism? Princeton: Princeton University Press, Argues that—bracketing issues of feasibility—socialism is morally desirable, but concedes that socialists do not know whether socialism is feasible.

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Analyzes freedom under capitalism, arguing that private property restricts formal freedom in underappreciated ways. Devine, Pat. Democracy and Economic Planning. Cambridge: Polity Press, Rich, detailed, economically sophisticated statement of a democratic alternative to central planning, with especially interesting ideas about the division of labor.

Elster, Jon. An Introduction to Karl Marx. Cambridge: Cambridge University Press. An often-critical reconstruction of central Marxist themes by one of the central figures in the Analytical Marxism movement. Social Philosophy and Policy , Vol. Analytically crisp discussion of self-realization and the prospects for achieving it under capitalism and socialism. Engels, Frederick. Socialism: Utopian and Scientific. Pathfinder Press, []. Friedman, Milton. Capitalism and Freedom. Chicago: University of Chicago Press. Gilabert, Pablo.

Harrington, Michael. Socialism: Past and Future. Hayek, Friedrich. Holmstrom, Nancy. Early, analytically sharp defense of the view that exploitation is forced, uncompensated labor, the products of which producers do not control. Lenin, Vladimir. The State and Revolution. New York: Penguin, []. Argues, to give one example, that genuine democracy is impossible under capitalism. Levine, Andrew. Arguing for Socialism. London: Verso. Rigorous, subtle work that mounts a qualified case for socialism using tools of contemporary moral and political philosophy.

Malleson, Tom. After Occupy: Economic Democracy for the 21st Century. New York: Oxford University Press, Empirically and philosophically rich development of a broadly market-socialist position with an especially interesting defense of workplace democracy. Marx, Karl. New York: Vintage Books, []. Critique of the Gotha Program. In David McLellan Ed. Oxford: Oxford University Press, []. Marx, Karl, and Frederick Engels. The Communist Manifesto.

London: Verso, []. An enormously influential political pamphlet outlining core elements of the Marxist theory of history, critique of capitalism, and program for a socialist future. Miller, David. Oxford: Oxford University Press, Important, philosophically sophisticated statement of market socialist ideas. Ollman, Bertell, ed. Market Socialism: The Debate among Socialists. Brings together leftist critiques and defenses of market socialism.

Peffer, Rodney. Marxism, Morality, and Social Justice. Accessible reconstruction of Marxist themes, using techniques of analytic philosophy, that brings Marxism into dialogue with liberal egalitarians like John Rawls. Reiman, Jeffrey. Argues that exploitation is forced, unpaid labor, and further contends—contrary to Cohen—that individual workers are indeed forced to work for capitalists. Thus countries that appear to have a high standard of living, as measured by GDP per capita, could in fact be populated by masses of miserably poor families.

In practice this is not the case. Among a large sample of countries from around the world, there is strong positive correlation between the growth of GDP per capita and the average income of the poorest 20 per cent of the population Dollar and Kraay As for its omissions, GDP per capita omits non-market activity, illegal activity, and the value of time spent at leisure. If you clean your house, then that economic activity does not show up in GDP; if you pay someone else to do it, it does. If your doctor writes a prescription for you and you purchase medicine from a pharmacy, then that economic activity shows up in GDP; if you purchase a controlled substance from a kid down the street, it does not.

You might place a high value on fishing with your daughter, but the activity will not show up in GDP per capita. This is the so-called Easterlin Paradox Easterlin Kuznets recognized these shortcomings. He hypothesized that the result might be a positive relationship between growth and the standard of living on the one hand both conventionally measured by GDP per capita and an increase in the inequality of the distribution of income on the other. The consumption of nutrients — net of those exhausted during work or from fighting disease — determines whether homo sapiens achieve their genetic height potential.

Thus stature differs from GDP per capita in that it reflects the consumption of nutrients and the biological costs associated with the production of goods and services; thus it reflects the distribution of economic output as manifest in consumption. When humans work harder for longer periods, or when they fight off disease, they are left with fewer nutrients for growth. Net nutritional status, the key to human growth, is the difference between nutritional inputs and the demands of work, body maintenance, and disease.

Before adulthood, a positive net nutritional status stimulates growth, while a negative net nutritional status will retard growth, ceteris paribus , of course. Changes in nutrition, working conditions, and disease environment can all influence net nutritional status, and the disease environment itself reflects public health measures or the lack thereof , urbanization, and economic growth. Hence, stature can reveal information about the distribution of income or wealth that might be hidden in real GDP or even real GDP per capita.

An economy experiencing modern economic growth and hence sustained increases in real GDP per capita, which we typically think of as indicating an increasing living standard, might be experiencing an increasingly unequal distribution of income the Kuznets curve , such that the welfare effects of growth are not widely spread and in fact result in a worsening of the biological standard of living. As the earlier discussion notes, the GDP figures reflect the modern economic growth that sprung from the Industrial Revolution.

However, the stature data reveal a troubling decline throughout the earlier decades of the nineteenth century. Thus, although aggregate economic activity expanded more rapidly than population, generating modern economic growth, that growth did not necessarily generate an improvement in the standard of living, at least as measured by biological indicators.

If nothing else, the history of measuring economic growth teaches us that it is often unhelpful to become too dogmatic about a particular set of output estimates. In short, the successful measurement of aggregate economic activity, the standard of living, and economic growth answered many important questions in economics. It also raised many new ones. Both are important contributions to human progress. In modern corporate accounting, the notions of flows and stocks, income and wealth are reflected in the income statement and the balance sheet, respectively.

The question was originally addressed by William Petty, who antedated Adam Smith by more than a century. This is not to say that there were no important contributions to macroeconomics during this period. Indeed W. See United States Department of Commerce Although Johnston and Williamson do not cite Kuznets directly, they do cite Kendrick, whose debt to Kuznets is explicit Kendrick There is a large literature on the flaws and omissions in national income accounting.

For a reasonably concise summary, see Stiglitz et al. It should be noted that recent research rejects the Easterlin Paradox. See, for example, Stevenson and Wolfers Of course, there is a biological maximum to stature. Further consumption beyond that point merely leads to obesity Komlos et al. The Economic History of War The Economic History of Fin Business Cycles Economic History and Cliome We are using cookies to provide statistics that help us give you the best experience of our site. You can find out more in our Privacy Policy.

By continuing to use the site you are agreeing to our use of cookies. Free trial voucher code. Invalid Search. Enter keywords, authors, DOI etc. Search History. Search history from this session 0. Metrics Views 1. Abstract Gross domestic product GDP , the value of final goods and services produced within a country during a period of time, is the measure economists typically use to gauge aggregate economic activity in a modern nation state. References Allen, R. Balke, N.

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Cage, R. Carson, C. Berndt and J. Chanda, A. Clark, G. Cuff, T. Dollar, D. Easterlin, R. David and M. Ekelund, R. Feldstein, M. Fogel, R. Hubbard, R. Hubbard, G. Huberman, M. Johnston, L. GDP then? Kendrick, J. Keynes, J. Komlos, J. Kuznets, S. Landreth, H.

Mingay, G. Romer, C. Schumpeter, J. Smith, A. Smith, M. Stevenson, B. Stiglitz, J. Young, A. Related chapters The Economic History of War