The Uses of an Economic System—and of Economics

"The purpose of an economic system would seem, at first glance to be reasonably evident, and it is commonly so regarded. Its purpose is to provide the goods and render the services that people want….The best economic system is the one that supplies the most of what people most want. Though greatly celebrated in the textbooks this is rather too simple a view. Over the last hundred years numerous economic tasks have come to be performed by organizations …industrial corporations..(etc)… Some of these organizations are very large; as few would doubt, they have power, which is to say they can command the efforts of individuals and the state. They command these, most will agree, for their own purposes, these being the purposes of those who participate through membership or ownership in the enterprise. Perhaps by some miracle of accident or design these purposes are usually the same as those of the public. In the absence of such miracle or arrangement it is, not surprisingly, the purposes of the organization, not those of the public which are served. So viewed, the function of the economic system is no longer simple – at least for anyone wishing to see the reality of things. Partly the economic system serves the individual. But partly it is now seen to serve the needs of its own organizations. General Motors exists to serve the public. But General Motors also serves itself as well or instead."

Barrons quote

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