Criticism

The theoretical basis for the free free-market economy with the picture of "the invisible hand of the market, developed by Smith, ", which would automatically produce the best for the general prosperity from the egoistic actions of the particular, is doubted. Smiths theory is a model and thus an incomplete illustration of the reality. Also the sociologist max of webers confessed critically that its theory of rational acting was a model, which can represent the reality only shortened.

As main points of criticism are stated:

• The free-market economy can lead to trusts and monopoly formations. These competition restrictions prevent those idealizing accepted perfect resource allocation. As counter measures states install supervisory authorities and issue restrictive trade practice acts (see also: Ordoliberalismus).
• Only products and offers are developed, which promise a profit. Among them suffer for example the research: Patients concerned by a rare illness do not form a lucrative market, therefore be omitted the research for the development of special medicines. Also different, usually small and very much diversified industries, like Web radios or model railways, suffered from it.
• external factors, for example dirty air, do not flow into the free market price system. Goods, which damage the environment, are too cheaply produced therefore. The free free-market economy does not offer incentives for the protection of the environment.
• The efficiency is reduced by unproductive work, which results in the competition, for power measurement and financing as well as for satisfaction "artificially "by advertisement of produced needs.

One speaks in this connection of market failure. The major task of a state is it now to prevent market failure. If this does not succeed in the desired measure, then one speaks of state failure.

Already Jeremy Bentham and its successors recognized such restrictions. The actually liberally adjusted Utilitarist Bentham developed felicific the calculus for social reasons. This philosophy is based on the basis the fact that the largest property which can be reached would be that, which leads to "the greatest possible luck for the greatest possible number "(greatest happiness for the greatest NUMBERs ). The social reformer in line with standard usage however later the second principle to greatest happiness principle.

From Marxist view the free-market economy, also the social free-market economy, serves primarily the capital interests of a minority in the population.

See also

• Initiative new one social free-market economy
• Market equilibrium, perfect market, consumer liberty
• Capitalism, Neoliberalismus, link liberalism, free economy, socialism
• Social politics, social justice, economic system
• List of the countries with social free-market economy

Literature

• Rothbard, Murray N.: One, Economy and State (complete English text; 1962, ISBN 0945466323)
• Erhard, Ludwig: Prosperity for all, 1957.
• Galbraith, John Kenneth: The economics of the innocent fraud. Of the reality loss of the today's economy, settler, Munich 2005, ISBN 3-88680-821-1
• Hate, Rolf H., Hermann cutter and Klaus Weigelt (Hrsg.) encyclopedia social free-market economy - economic policy from A to Z., Paderborn 2002 (UTB 2325), ISBN 3-8252-2325-6
• Hayek, Friedrich A.: Freiburger studies. 1969.
• Briefly, Robert: Black book capitalism. A Abgesang on the free-market economy, Ullstein 2001, ISBN 3-548-36308-3
• Mueller Armack, Alfred: Economic control and free-market economy.
• Smith, Adam: The prosperity of the nations; ISBN 342330149-X
• Suntum, Ulrich van: The invisible hand ISBN 3540410031

Related links

• What is the Free of Murray Rothbard
• Administrative policy and social free-market economy
• Social free-market economy - the escape forward
• Article over "social free-market economy "with the DHM
• '' Like the social free-market economy to end goes '' in the world on Sunday of 26.2.2006 from Wolfgang

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