Capitalism Contd The

Capitalism Contd The

Capitalism (cont�d) The development of capitalism has not so far favoured the Marxian prophecy. The evidence does not support the expectation of increasing concentration in industry; the standard of living of wage and salary earners in the advanced capitalist economies has risen; and capitalist development since Marx has tended to blur the distinctions between 'proletariat' and 'bourgeoisie' rather than aggravate them.

Changes in capitalist economies during the present century have led to a further discussion of the nature of capitalism. Attention has been focused on the large limited liability company, which differs from the one-man firm or private partnership of the earlier nineteenth century since its owners are numerous and exercise no continuous or unified control over the company's affairs, while the salaried directors who wield control are frequently not sizeable shareholders. Hence the 'divorce' between ownership and control. The tendency towards 'bureaucratization' in this type of capitalist firm has been treated by Schumpeter and others as part of a more general development into a different type of society. Other economists and social scientists, such as Walter Lippmann, P. A. Hayek, Lionel Robbins and others, have emphasized the responsibility of the legal framework on companies, contract, etc., for the forms of monopoly that have developed within capitalist economies.

Capitalist activity has persisted in the communist economies, where it is tolerated for political reasons or alternately encouraged and suppressed when centralized direction of the economy has weakened incentives and reduced production. Much private enterprise is permitted in Russia, Poland, Yugoslavia and other economies in which the main means of production are owned by the state.

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Since then his writings have in turn been increasingly reinterpreted as a special case both by some followers and by some economists who had not wholly accepted his writings. The content of economics is in a state of change, and this site is therefore not a final statement of economic doctrine.

Economics is in the last resort a technique of thinking. The reader will therefore need to make an intellectual effort, more substantial for some web entries than for others, to get the most interest and value out of this website.