Essay on The Economic System Prevailing Is The Free Economy System

772 Words Mar 1st, 2016 4 Pages
I am convinced the only surviving socio-economic system prevailing is the free economy system which generated fast economic growth and prosperity albeit often ignoring social injustices along the way. This capitalistic system was born in Europe in the middle ages replacing feudalism when private concerns were generating surpluses and were ready to re-invest same thus spurring economic growth, albeit erratically. In the 18th century a Scottish moral philosopher, Adam Smith became the pioneer of political economy and advocated for the “free market” and “the invisible hand” concepts while Ethics and Moral philosophy, a subject he taught at Edinburgh University were essential built-in ingredients in this new ideology. In the first half of the 20th century, an English economist John M. Keynes advocated interventionist government policy. i.e., close monitoring (not controlling) of private business activities and the occasional use of fiscal and monetary measures to regulate the economic cycles for the benefit of all. Decades of prosperity along the Keynesian model characterized the economies of W. Europe and N. America after the 2nd world war. The origins of today’s colossal worldwide financial crisis were born in Chicago University where an American Nobel Prize winner, Milton Friedman, originally a Keynesian in economic policies convictions started in the 60’s to preach ultra liberal theories, de-regulation, complete government hands-off and without any monitoring or…

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