IDEAS home Printed from https://ideas.repec.org/a/zbw/espost/242969.html
   My bibliography  Save this article

Economic Development and the Death of the Free Market

Author

Listed:
  • Fix, Blair

Abstract

According to neoclassical economics, the most efficient way to organize human activity is to use the free market. By stoking self interest, the theory claims, individuals can benefit society. This idea, however, conflicts with the evolutionary theory of multilevel selection, which proposes that rather than stoke individual self interest, successful groups must suppress it. Which theory better describes how human societies develop? I seek to answer this question by studying the opposite of the market: namely hierarchy. I find evidence that as human societies develop, they turn increasingly to hierarchical organization. Yet they do so, paradoxically, at the same time that the language of free markets becomes more common, and culture becomes more individualistic. This evidence, I argue, contradicts free-market theory, but only if we treat it as a scientific doctrine. If instead we treat free-market theory as an ideology, the pieces come together. Free-market thinking, I speculate, may stoke the formation of hierarchy by cloaking power in the language of ‘freedom’.

Suggested Citation

  • Fix, Blair, 2021. "Economic Development and the Death of the Free Market," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics.
  • Handle: RePEc:zbw:espost:242969
    as

    Download full text from publisher

    File URL: https://www.econstor.eu/bitstream/10419/242969/1/20210820_fix_economic_development.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Thomas J. Dohmen & Ben Kriechel & Gerard A. Pfann, 2004. "Monkey bars and ladders: The importance of lateral and vertical job mobility in internal labor market careers," Journal of Population Economics, Springer;European Society for Population Economics, vol. 17(2), pages 193-228, June.
    2. Eriksson, Tor, 1999. "Executive Compensation and Tournament Theory: Empirical Tests on Danish Data," Journal of Labor Economics, University of Chicago Press, vol. 17(2), pages 262-280, April.
    3. Ariga, Kenn & Brunello, Giorgio & Ohkusa, Yasushi & Nishiyama, Yoshihiko, 1992. "Corporate hierarchy, promotion, and firm growth: Japanese internal labor market in transition," Journal of the Japanese and International Economies, Elsevier, vol. 6(4), pages 440-471, December.
    4. Bichler, Shimshon & Nitzan, Jonathan, 2020. "Growing through Sabotage: Energizing Hierarchical Power," Review of Capital as Power, Capital As Power - Toward a New Cosmology of Capitalism, vol. 1(5), pages 1-78.
    5. Fichtner, Jan & Heemskerk, Eelke M. & Garcia-Bernardo, Javier, 2017. "Hidden power of the Big Three? Passive index funds, re-concentration of corporate ownership, and new financial riskâ€," Business and Politics, Cambridge University Press, vol. 19(2), pages 298-326, June.
    6. Baker, George & Gibbs, Michael & Holmstrom, Bengt, 1993. "Hierarchies and compensation: A case study," European Economic Review, Elsevier, vol. 37(2-3), pages 366-378, April.
    7. Rick Audas & Tim Barmby & John Treble, 2004. "Luck, Effort, and Reward in an Organizational Hierarchy," Journal of Labor Economics, University of Chicago Press, vol. 22(2), pages 379-396, April.
    8. Christian Arnsperger & Yanis Varoufakis, 2006. "What Is Neoclassical Economics? The three axioms responsible for its theoretical oeuvre, practical irrelevance and, thus, discursive power," Panoeconomicus, Savez ekonomista Vojvodine, Novi Sad, Serbia, vol. 53(1), pages 5-18, March.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Fix, Blair, 2021. "Living the good life in a non-growth world: Investigating the role of hierarchy," SocArXiv wem9p, Center for Open Science.
    2. Fix, Blair, 2021. "Living the Good Life in a Non-Growth World. Investigating the Role of Hierarchy," Working Papers on Capital as Power 2021/02, Capital As Power - Toward a New Cosmology of Capitalism.
    3. Fix, Blair, 2020. "Economic Development and the Death of the Free Market," SocArXiv g86am, Center for Open Science.
    4. Blair Fix, 2018. "Hierarchy and the power-law income distribution tail," Journal of Computational Social Science, Springer, vol. 1(2), pages 471-491, September.
    5. Fix, Blair, 2018. "Capitalist income and hierarchical power: A gradient hypothesis," Working Papers on Capital as Power 2018/06, Capital As Power - Toward a New Cosmology of Capitalism.
    6. Fix, Blair, 2018. "The growth of US top income inequality: A hierarchical redistribution hypothesis," Working Papers on Capital as Power 2018/05, Capital As Power - Toward a New Cosmology of Capitalism.
    7. Fix, Blair, 2018. "Capitalist Income and Hierarchical Power," SocArXiv u8epv, Center for Open Science.
    8. Fix, Blair, 2020. "Economic Development and the Death of the Free Market," Working Papers on Capital as Power 2020/01, Capital As Power - Toward a New Cosmology of Capitalism.
    9. Fix, Blair, 2017. "Evidence for a Power Theory of Personal Income Distribution," Working Papers on Capital as Power 2017/03, Capital As Power - Toward a New Cosmology of Capitalism.
    10. Fix, Blair, 2018. "The Growth of US Top Income Inequality: A Hierarchical Redistribution Hypothesis," SocArXiv suqnk, Center for Open Science.
    11. Fix, Blair, 2017. "Evidence for a Power Theory of Personal Income Distribution," SocArXiv qgwus, Center for Open Science.
    12. Fix, Blair, 2018. "The Trouble With Human Capital Theory," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, pages 15-32.
    13. Fix, Blair, 2019. "How the Rich Are Different: Hierarchical Power as the Basis of Income Size and Class," SocArXiv t8muy, Center for Open Science.
    14. Blair Fix, 2021. "How the rich are different: hierarchical power as the basis of income size and class," Journal of Computational Social Science, Springer, vol. 4(2), pages 403-454, November.
    15. Fix, Blair, 2019. "How the rich are different: Hierarchical power as the basis of income size and class," Working Papers on Capital as Power 2019/02 (v.2), Capital As Power - Toward a New Cosmology of Capitalism.
    16. Fix, Blair, 2016. "Energy and Institution Size," Working Papers on Capital as Power 2016/04, Capital As Power - Toward a New Cosmology of Capitalism.
    17. Fix, Blair, 2018. "The trouble with human capital theory," Working Papers on Capital as Power 2018/07, Capital As Power - Toward a New Cosmology of Capitalism.
    18. Fix, Blair, 2018. "The Trouble with Human Capital Theory," SocArXiv ax6k7, Center for Open Science.
    19. Fix, Blair, 2017. "Energy and Institution Size," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, pages 1-22.
    20. Fix, Blair, 2019. "How the rich are different: Hierarchical power as the basis of income and class," Working Papers on Capital as Power 2019/02, Capital As Power - Toward a New Cosmology of Capitalism.

    More about this item

    Keywords

    culture; development; energy; evolution; free market; hierarchy; multilevel selection; power; sociality;
    All these keywords.

    JEL classification:

    • P16 - Economic Systems - - Capitalist Systems - - - Political Economy of Capitalism
    • P26 - Economic Systems - - Socialist Systems and Transition Economies - - - Political Economy
    • P48 - Economic Systems - - Other Economic Systems - - - Political Economy; Legal Institutions; Property Rights; Natural Resources; Energy; Environment; Regional Studies
    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:zbw:espost:242969. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: . General contact details of provider: https://edirc.repec.org/data/zbwkide.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ZBW - Leibniz Information Centre for Economics (email available below). General contact details of provider: https://edirc.repec.org/data/zbwkide.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.