Free Market: The History of an Idea

Description

After two government bailouts of the American economy in less than twenty years, free market thought is due for serious reappraisal. Free Market: The History of an Idea shows how the idea became so powerful, why it succeeded, and why it has failed so spectacularly. In 1990, the G7 Countries enjoyed 70 percent of world GDP. In the face of the collapse of the Soviet Union, it was supposed to be a story of the success of free markets. However, in the past thirty years, that number has dropped by half, and Asia has emerged as a major motor of world economic growth. Today, state-run China is the second biggest economy on earth, and tiny Singapore, with its state-owned companies, has become a new model of wealth creation. In other words, Milton Friedman's free market dogma, that only private companies can create wealth and that states hamper it, has not proved very clearly to be untrue. This book shows how we got to the current crisis of free market thought, and suggests how we can find our way out. Contrary to popular free market narratives, early market theorists believed that states had an important role in building and maintaining free markets. But in the eighteenth century, some free-market thinkers began insisting only pure free markets, without state intervention, could work. A tradition of free-market ideological brittleness emerged, and it has led orthodox free market economics to some spectacular failures. It is a paradox that an economic theory rooted in the idea of competition, adaptation and evolution, has refused to follow its own precepts. This book shows that we need to go back to the origins of free market thought in order to understand its dynamism, as well as its inherent weaknesses, and to develop new economic concepts to face the staggering challenges of the twenty-first century.

Jacob Soll is university professor and professor of philosophy, history, and accounting at the University of Southern California. The author of The Reckoning and The Information Master, Soll is the recipient of many prestigious awards, including the MacArthur Genius grant. He lives in Los Angeles.

"A truly excellent, excellent, wonderful book."--J. Bradford Delong, author of Slouching Towards Utopia "A timely and erudite history...incisive."--Financial Times "If anyone is qualified to write a history of free-market thinking, it is surely Jacob Soll."--Literary Review "Free Market offers a rich and valuable antidote to narrower and more traditional accounts of the liberal economic tradition."--The Guardian "Nuanced history of a notion that, while central dogma in economics, is in the eye of the beholder....[an] authoritative account...stimulating....a cleareyed exposition of an important tenet of economic thought, with all its shades of meaning."--Kirkus (starred review) "Among the defining values of Western societies, free expression and human rights stand tall. What about the free market? How certain are we about its origins and meaning? As only a master historian can, Jacob Soll takes us through the origins, alternatives, and ambiguities. Defenders as well as detractors must consult this defining history."--Margaret C. Jacob, distinguished research professor, UCLA "If, as Keynes asserted, ideas are in the end, what is most important, intellectual history captures the driving forces behind social change. There is much to be learned relevant to current policy debates from Jacob Soll's engaging history of the free market idea. Whether you think you love or hate free markets, you will learn much from this important book."--Lawrence H. Summers "In this essential book, Jacob Soll gives us a lucid, frequently surprising, and altogether enthralling account of the history of free market thought. Deeply learned and engagingly written, the book has important implications for how we should think about free markets today. In every sense, it is a revelation."--David A. Bell, Princeton University "Jacob Soll's fascinating and pathbreaking study is a historical tour de force and a brilliant exploration of the major economic ideas that have shaped our world."--Gordon Brown, former prime minister, United Kingdom "In an awe-inspiring and enthralling tour from the ancient to the contemporary world, Jacob Soll dissolves the dichotomy of market and government, showing that it was campaigns for affluence led by the state in the century and a half before the French Revolution that birthed the dream of liberating economic affairs from interference. Soll is one of our master historians, and his newest book makes it impossible to think about the wealth of nations--or our political future--in the same way again."--Samuel Moyn, Yale University