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In the late 1980s, the field of comparative economics and NATO faced a similar problem: the threat of obsolescence. A predictable reaction of those who had made major investments in both comparative economics and NATO was to look for a new job. It was time to say: comparative economic systems are dead, long live comparative economic systems. The purpose of this book is to redirect study of what we called comparative economic systems toward analysis of the development of institutions and the effects of alternative institutional arrangements on economic performance. To that end, the book internalizes into a theoretical framework (1) the effects of alternative property rights on the costs of transactions and incentives structures, (2) the effects of the costs of transactions and incentives on economic behavior, and (3) the evidence for refutable implications of those effects. Analysis here focuses on the issues, propositions and conclusions that lend themselves to the only known scientific test: empirical verification. Thus, this book is not about what socialism or capitalism could have been, should have been, or should be. Nor is it an ode to capitalism. Its purpose is not to assert that capitalism is a better economic system than socialism. The history of this century and the market for institutions have done that. My purpose is to explain what is it that makes the institutions of capitalism better in terms of economic outcome than all other alternatives that have been tried since the beginning of recorded history.
List of contents
One: The Framework for Economic Analysis.- 1 Important Concepts in Economics.- 2 The Coase Theorem and Transaction Costs.- Two: Institutions, Property Rights, and Systems.- 3 Institutions.- 4 Law and Institutions.- 5 Property Rights.- 6 Capitalism and Socialism.- Three: Property Rights, Exchange, and Production.- 7 Private Property Rights, Exchange and Production.- 8 Restrictions on Ownership, Exchange, and Production.- 9 Free-Market Economies, the State, and Policy-Making.- 10 Property Rights in Socialism, Exchange and Production.- 11 Trade (Exchange), and Growth Under Different Institutional Arrangements.- Four: Property Rights and Business Firms.- 12 The Firm and Contracts.- 13 Capitalist Firms.- 14 Socialism: The Labor-Managed Firm.- 15 Property Rights, Business Firms and Innovation.
Summary
The purpose of this book is to redirect study of what we called comparative economic systems toward analysis of the development of institutions and the effects of alternative institutional arrangements on economic performance.
Report
`... this book makes a great contribution to understanding and comparing economic systems. It is an important basis for building a new approach to the comparison of different economic systems and my hope is that it will contribute to the development of the analytical debate among comparativistsend.'
Economic Systems, 23:3 (1999)
