ALBERT

Notes: Recent theories of capitalism concentrate upon the defects of markets. The theories of Karl Polanyi and Bruno Seidel are examined in this article. In a broad survey of economic history since the middle ages, Polanyi concludes that the whole economic market system destroys the substance of society and creates disadvantages for all groups. Yet disintegration was halted through the principle of social protection which comprises all forms of collective economic actions, whether by groups or states. Yet, the author has failed to give a specific market analysis which would indicate how specific disadvantages arise in the process of pricing. The all comprehensive “social protection” contains so many diverse elements that one cannot infer from the principle how interventions have reformed the market system of capitalism.In his analysis of industrialism and capitalism, Seidel sees a conflict between the industrial and capitalist elements of our economy. Capitalist elements have been “tamed”, while we have been unable to control the industrial elements. Modern technology has become independent of capitalist property and markets. Industrialism has been economically beneficial and socially disintegrating. Deconcentration of large concerns and decentralization of large cities are proposed as necessary reforms. Interventions in markets spring from cartels of producers, organizations of farmers, unions of laborers, and the interference of states. The multitude of interventions is developing into a planned capitalism. The result of these interventions has been a greater degree of equality in the economic and social relationships among men. Control of capitalism was achieved through introducing social-ethical principles into the economy.The newer version of the defect theory limits control of the market system to the most recent period, and states some of the reasons why organized groups control their markets. The theory of social protection is limited in its scope; its economic, political and social impact upon capitalism is traced in detail. Yet missing is still a theory of deficient markets as well as of controlled markets. The future task of economic research is to provide an analysis of the different market sectors controlled by groups, of the monopoly of concentrated property, of the specific nature of social protection, and the economic role of big government in controlled capitalism.