Tag: free enterprise

Capitalism may have a public relations problem, but it doesn’t have an inequality problem

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Feb. 5, Robert Lawson, Jerome M. Fullinwider chair in Economic Freedom, SMU Cox School of Business, for an op-ed challenging the perrception that capitalism inevitably leads to inequality. Published in the Orange County Register and the Southern California News Group under the heading Capitalism may have a public relations problem, but it doesn’t haves an inequality problem: http://tinyurl.com/yc2cmtsp 

Capitalism has a public relations problem. While many will grudgingly admit that capitalism, the economic system based on private property and free trading, yields faster rates of economic growth, higher income levels, and even reduces poverty, they will complain  capitalism’s big problem is inequality.

French economist Thomas Piketty has made his professional career by arguing precisely that capitalism engenders more economic inequality. His argument, in a nutshell, is that profits and rents will grow faster than wages and that over time there will be a growing gap between the owners of capital and wage earners. Piketty’s concerns have animated a growing academic debate about capitalism and inequality. Much of this conversation gets deep into the statistical weeds about how we measure inequality and will likely go on for a long time without a resolution.

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Is It Better to Be Rich in a Poor and Unfree Country?

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May 17, Robert Lawson, director of the Bridwell Institute for Economic Freedom at the SMU Dallas Cox School of Business, for an essay about how average people are more likely to prosper in counties that are more free and less regulated. Published in Inside Sources under the heading Is It Better to Be Rich in a Poor and Unfree Country?: https://tinyurl.com/mtbv3duf

Like many economics professors, I frequently get emails from a variety of cranks and conspiracy theorists. Occasionally, I get an interesting email question about my research on economic freedom. It’s complicated, but in a nutshell, my work generally shows that countries with more economic freedom (i.e., lower taxes, stronger private property rights, less inflation, freer trade and fewer regulations) perform better on most, if not all, measures of socio-economic progress.

Recently, an email correspondent who lives in Hong Kong asked: How can Hong Kong and Singapore, the countries with the highest economic freedom in the world, also be two places that are “so expensive that you won’t have sufficient funds to have personal financial freedom?” He continued, “I am wondering how we, as people who love free-market capitalism, can reconcile this? How can the ‘best’ (most capitalist) countries in the world also be some of the most difficult to get by in?”

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