Can market socialism realize the socialist vision of the good society by ending exploitation and alienation, substantially reducing inequalities of wealth and income, ensuring full employment, and correcting other market irrationalities? A comparative analysis of the organizational forms of capitalism (notably the small owner?operated firm and the large corporation) and market socialism (the self?managed cooperative that rents its capital from the state) reveals the relative efficiencies of capitalism in reducing transaction costs, in turn reducing the opportunities for exploitation. By contrast, (...) the transaction cost inefficiencies of the organizations of market socialism permit and encourage forms of exploitation that are precluded or discouraged under capitalism. (shrink)

Historically, critics of capitalism have had a great deal to say about the defects and social ills that afflict capitalist society and correspondingly little to say about how alternative institutional arrangements might solve these problems. One can only speculate about why this has been so. One reason might be a simple matter of priorities. Bertolt Brecht once said that when a man's house is on fire, one does not inquire too closely into alternative arrangements for shelter. The analogy between capitalism (...) and a burning house may seem overwrought today, but in the dark days of the Depression of the 1930s it probably seemed more apt. Another explanation for the scant attention paid to alternatives to capitalism has to do with both the factual and ideological beliefs of capitalism's critics. If one believes that the existing order would be destroyed by a mass movement, that new institutions would be constructed by the people in a democratic spirit, and that furthermore all of this would be a good thing, it would be unwise and counterproductive to try to spell out exactly where history is headed. After all, a genuine mass movement has little use for self-proclaimed prophets of history. Finally, men and women of modest intellectual pretensions might be humbled by the prospects of trying to spell out in any detail social institutions that should exist or might exist but are not as yet found anywhere in the world. (shrink)

When assessing institutions and social outcomes, it matters how free society is within them (‘societal freedom’). For example, does capitalism come with greater societal freedom than socialism? For such judgements, freedom theorists typically assume Individualism: societal freedom is simply the aggregate of individual freedom. However, G.A. Cohen’s well-known case provides a challenge: imagine ten prisoners are individually free to leave their prison but doing so would incarcerate the remaining nine. Assume further that no one actually leaves. If we adopt Individualism (...) plus the standard liberal view of freedom, such incarceration seems to leave societal freedom unaffected. This is an important theoretical challenge: it seems we must either reject Individualism or reject, or at least amend, the liberal view. Cohen also suggests his case, and the collective unfreedom therein, helps us capture how proletarians are unfree under capitalism. In this article, I argue that we can solve Cohen’s puzzle, if we focus on how power can reduce freedom. If we adopt the republican view of freedom, we can say that prisoners are unfree in Cohen’s case because they are dominated by the other prisoners. This solution keeps Individualism but moves beyond liberal freedom. I then also show how this individualistic framework captures proletarian unfreedom. (shrink)

This paper carries forward the conceptual clarification of normative theories of business ethics ably begun by Hasnas in the January 1998 issue of BEQ. This paper proposes a normatively neutral framework for discussing and assessing such normative theories. Every normative theory needs to address these seven issues: it needs to specify a moral principle that identifies (1) recommended values and (2) the grounds for accepting those values. It also must specify (3) a decision principle that business people who accept the (...) theory can use. It must determine (4) who the normative theory applies to and (5) whose interests need to be considered. It must also outline (6) in what contexts it applies, and (7) what legal and regulatory structures it assumes. Once clarified, this paper applies the framework to the normative versions of stockholder theory, stakeholder theory, and ISCT. It is concluded that ISCT is the most promising normative theory currently under discussion, but that there are some major issues that ISCT has not dealt with yet. (shrink)