Foundations of liberty
鈿栵笍 Economic Systems: Capitalism, Mercantilism, Socialism and Communism
How four economic systems answer the same questions about who owns, who decides and who gets what, drawing heavily on Milton Friedman, Friedrich Hayek, Adam Smith and Thomas Sowell, with the historical record of each system and the strongest criticisms answered. Each lesson ends with a short quiz.
- 1What Every Economic System Must DecideScarcity forces every society to settle what gets made, how, and for whom. A pencil from 1958, Lionel Robbins's definition and Friedrich Hayek's problem of scattered knowledge frame the four systems this module studies.17 min
- 2MercantilismFor two centuries European governments treated trade as a contest for treasure. This lesson follows the idea from Thomas Mun to Colbert, through the Navigation Acts that irritated the American colonies, to Adam Smith's attack and the modern arguments over tariffs and industrial policy.19 min
- 3Adam Smith and The Wealth of NationsA Scottish professor who never married wrote two books, one on sympathy and one on wealth. Smith's pin factory, his butcher, brewer and baker, his single use of the invisible hand and his warnings about merchants and about government are read here in his own words, with the common misreadings corrected.20 min
- 4Capitalism: Prices, Property and ProfitPrivate property, voluntary exchange, prices, profit and loss, and entrepreneurs are the working parts of a market economy. This lesson draws on Madison, Hayek, Mises, Schumpeter, Kirzner and de Soto, and sets the American growth record beside the costs that critics point to.19 min
- 5Milton Friedman: Capitalism and FreedomMilton Friedman's life, his 1962 case that economic freedom is a necessary condition for political freedom, his list of fourteen government activities he thought unjustified, and his proposals on schools, poverty, business and money. The lesson also sets out the best objections and states the Chile and Hong Kong controversy accurately.19 min
- 6SocialismWhat socialism means (social ownership, the welfare state, democratic socialism), the case Mises and Hayek made against it, what happened in Britain, why Denmark's prime minister says his country is not socialist, and what the numbers show for Venezuela.20 min
- 7CommunismFrom the ten measures in the Communist Manifesto to Lenin's retreat, Stalin's collectivization, Mao's Great Leap Forward, Cambodia and Cuba, with the death-toll ranges historians give and the reasons central planning fails.22 min
- 8Comparing the RecordDivided Germany and Korea, Hong Kong beside mainland China, China after 1978, and Chile beside Venezuela, with GDP per capita from the Maddison Project Database 2023, life expectancy, the economic freedom indexes and an honest account of what such comparisons cannot prove.23 min
- 9The Critics and the AnswersThe strongest cases against free markets (externalities, public goods, monopoly, inequality, the Great Depression, the 2008 crisis), each stated at full strength, followed by the replies of Friedman, Hayek and Sowell and the public-choice account of government failure and regulatory capture.24 min
- 10The American Mix and Economic Freedom TodayThe United States as a mixed economy, measured: federal spending as a share of GDP since 1930, the Federal Register, tariffs, the farm and sugar programs, occupational licensing and Idaho's reforms, with a plain test for judging any policy.24 min