Thinking about Capitalism

by Jerry Z. Muller (Biography)

The following materials are provided to enhance your learning experience. Click the links below
for free information including a professor-authored course summary, recommended web links,
and a condensed bibliography.
Course Summary - Professor's written description of the course.
Professor Recommended Links
Condensed Bibliography - Prepared by the professor for this course.

Course Summary

This course is designed to help us think about capitalism, not only as an economic system, but
in terms of its moral, political, and cultural effects. Does the spread of the market—across
geographical borders and into more and more regions of our lives—make us better off or
worse? What effect does it have on personal development, on the family, and on collective
identities? Is economic growth desirable, and if so, what sorts of policies are most conducive to
economic development? This course focuses on the response to such questions by major
European and American thinkers from the seventeenth through the twentieth centuries, with a
view to casting light on recurrent and perennial issues in thinking about capitalism. Placing each
thinker in historical context, it provides an overview of the development of modern capitalism
and of the cultural and political reactions to it. Exploring the historical roots of thinking about
what has come to be called "globalization," the course provides perspectives on capitalism that
are not typically encountered in economics courses or on the business pages of newspapers
—perspectives drawn from a variety of political, disciplinary and national points of view.
We begin by examining the two main pre-modern traditions that formed the backdrop against
which modern intellectuals thought about commerce: the civil republican tradition (a legacy of
ancient Greece and Rome) and the Christian tradition. Both traditions were suspicious of
commerce. One form of commerce, the lending of money at interest, was viewed as a sin by the
Catholic Church, and this important economic function was relegated to the Jews, who were
seen as beyond the brotherhood of the faithful, with later consequences that we trace in the
course.
In the seventeenth century, in reaction to an era of religiously based civil war, Thomas Hobbes
and other thinkers called into question the ideal of a polity dominated by religious ideals. They
advanced a view of the world based upon the pursuit of worldly happiness, and explored the
potentially positive role of self-interest. At the same time, the rise of Holland led European
thinkers and policy makers a new emphasis on the link between commerce and national power.
Through an examination of the career of Voltaire, we explore the rise of intellectuals as shapers
of public opinion, a rise made possible by the market for print. We examine Voltaire's
arguments for the connection between commerce and toleration, and his debate with Jean-
Jacques Rousseau over whether the rise in material well-being is conducive to happiness and
morality.
Four lectures present a nuanced view of the ideas of Adam Smith, author of The Wealth of
Nations, perhaps the most influential work ever written about capitalism. Smith explained how a
competitively structured market could channel self-interest into a higher level of material well-
being for all. But he also pointed to the difficulties of creating and maintaining a competitive
market economy, to some of it intrinsic dangers, and to the role of government in combating
these dangers. He offered a balance sheet that tallied the moral and immoral sides of
contemporary capitalism. In a later lecture, we look at the work of a sympathetic critic, Alexander
Hamilton, and why he believed that the free trade policies Smith advocated were inappropriate
for the new United States, and for any nation seeking to emerge from what we would now call
"underdevelopment." We look at the tensions between conservatism and capitalism in the work
of the late eighteenth century thinkers, Edmund Burke and the German writer Justus Möser.
In the nineteenth century, we examine the arguments of Hegel about the link between commerce
and modern individuality, and the role of the state in making both possible. We explore Alexis de
Tocqueville's reflections on the pitfalls and possibilities offered by capitalism as he encountered
it in America. Two lectures devoted to Karl Marx examine his cultural criticism of the nature of
work under capitalism, and the reasons for his prediction that the ongoing misery of the new
industrial working class would lead to class conflict and the end of capitalism. Marx's
contemporary, the British critic Matthew Arnold, provides a conception of cultural criticism that is
not antipathetic to markets, but is wary of the applying market criteria to other areas of life.
A series of lectures explore the turn of the century debates between the German social theorists
Ferdinand Tönnies, Georg Simmel, Max Weber and Werner Sombart on the relationship of
capitalism to community, individuality, rationalization and religion.
Joseph Schumpeter's conception of capitalism as "creative destruction," in which
entrepreneurial activity creates dynamism but invites resentment and reaction is the subject of
another lecture. We examine the early twentieth century debate between Lenin and others on the
relationship of capitalism to imperialism and to war.
After a brief look at the policies adopted by Lenin's Bolshevik government in the new Soviet
Union, we look at a spectrum of reactions to the crises of capitalism in the inter-war era, and the
new analyses to which they gave rise, from intellectuals associated with fascism (Carl Schmitt
and Hans Freyer), neo-liberalism (Ludwig von Mises and Friedrich von Hayek), and ironic
conservatism (Schumpeter). Then we explore the rise of welfare state capitalism, including its
intellectual origins in social democracy, Christianity, and in the new liberalism represented by
John Maynard Keynes. We explore the varieties of post-war welfare state capitalism (as
explained by Gøsta Esping-Andersen), before turning to its foremost critics from the left (Herbert
Marcuse) and from the right (Hayek).
In the 1970s, the American sociologist Daniel Bell argued that capitalism was developing into a
"post-industrial society," yet thought there was a risk that the character traits promoted by
contemporary culture and by the market itself might undermine the system. The economic
stagnation of the era led to the growth of analyses of the tensions between democracy and
capitalist economic growth, which we explore in the work of James M. Buchanan and Mancur
Olsen.
A lecture on the family and the market shows how each of these institutions continues to
transform the other, and explores the trade-offs between household labor, paid labor, and familial
consumption.
Later lectures examine contemporary globalization in historical perspective, the link between
capitalism and nationalism as explained by Ernest Gellner, the varieties of contemporary
capitalism, and finally the intrinsic tensions of capitalism and the reasons it has outlasted its
competitors.
By the end of the course, listeners should have a broad sense of the history of modern
capitalism, an acquaintance with "the best that has been thought and said" about capitalism,
and an arsenal of concepts with which to think about contemporary developments.

Return To Top

Professor Recommend Links

http://eh.net/encyclopedia/
http://oll.libertyfund.org/index.php?option=com_frontpage&Itemid=149
http://www.econlib.org/library/CEE.html

Return To Top

Condensed Bibliography
These selected titles from the reading list are now available on Amazon.com. Click on a title for
more information and/or to order the title.

An Inquiry into the Nature and Causes of the Wealth of Nations . Smith, Adam; eds.,
R.H. Campbell and A.S. Skinner

The best edition of Smith's classic work, with footnotes that illuminate the text.

Capital, Volume 1, trans. Ben Fowkes. Marx, Karl

The only volume of Capital published in Marx's lifetime, in a modern translation, with
a wide-ranging if uncritical introduction by the Marxist economist, Ernest Mandel.

Capitalism, Socialism and Democracy. Schumpeter, Joseph A

Schumpeter's wide-ranging summa. Eminently readable, despite many stylistic

Commerce, Culture and Liberty: Readings on Capitalism before Adam Smith. Clark, Henry C.,
ed

A very useful collection of readings from seventeenth and eighteenth century European authors,
including Barbon, Mandeville, Voltaire, and Rousseau.

The Coming of Post-Industrial Society: A Venture in Social Forecasting . Bell, Daniel

A prescient and influential characterization of the changing character of capitalism.

The Mind and the Market: Capitalism in Western Thought. Muller, Jerry Z

An exploration of many of the European thinkers dealt with in this course, placing
them in their economic, cultural, and political contexts. Published in hardcover as The
Mind and the Market: Capitalism in Modern European Thought.

The Passions and the Interests: Political Arguments for Capitalism before Its Triumph.
Hirschman, Albert O

A now classic exploration of seventeenth and eighteenth century arguments about

The Wealth and Poverty of Nations: Why Some Are So Rich and Some Are So Poor .
Landes, David S
 A leading economic historian with a feel for culture and institutions explores one of
the biggest of historical questions in the history of capitalism.

In some cases the only available book from Amazon is a newer edition than the one used by the
professor. The edition used by the professor may be available on the used market.

Return To Top