----------------- HES POSTING ----------------- Prof. Fred Carstensen from the University of Connecticut kindly sent me off-list three articles to be published in Romanian economic journals. They are a programmatic exposition of US ideals as applied in real-life institutions. In describing 'capitalism' he makes a very good description of the Free Enterprise system, based on well-defined property rights, and explores the role of the State to create, protect and sometimes substitute markets. He argues that the Anglo-Saxon common law tradition is a central piece of such arrangements. But I argue that is not the point; historical 'capitalism' was in fact a Capital-needing Free Enterprise system, and currently the best approximation is maybe fast-growing China. The current western system I call 'market economy' is a Markets-needing, mostly Free Enterprise system. The differences between the two have been partly summarized by Alvin Toffler (Second to Third waves), and are reflected culturally by the transition from Modernism to Postmodernism. For symmetry, real socialism was a Capital-needing State Administration system. The transition from Capital-needing to Markets-needing is what I want to explore; I feel that most current textbook economics is the product of another era and not sufficiently descriptive of current realities. Notably the emphasis on comparative statics. I've not yet seen a satisfactory, *quantitative* model of modern marketing strategy based on product quality, incorporating the product life cycle; entry and exit not just from a market, but from public consciousness; technological progress and obsolescence. There are nice theories in marketing, but purely word-based; skill in literary criticism seems more valued in this field than numerical analysis. There may be empirical models in large businesses, but probably top secret to keep the $$$ inside. Noteworthy is that pure competition is still presented as an ideal, while real firms strive to avoid it - in jargon, to "proactively leverage their core competencies to build sustained competitive advantage" - that is, to create and then exploit oligopoly rents. There is a weird sort of popular literature appearing now in Romania, mostly translated from French, which opposes free markets as American imperialist tools and accuse 'mondialization' to be a way of exploiting peoples and their nature. They denounce the IMF, World Bank, and see everywhere Big Business conspiracies. I'm not too clear what they propose instead: some sort of autarchic new socialism? or a community-based self-administration? Also I'm not clear what forces around the globe support such views; traditionally it has been the Soviet Union, but now? When did such views arise? Thanks for thinking on this, Mircea ------------ FOOTER TO HES POSTING ------------ For information, send the message "info HES" to [log in to unmask]