Understanding Capitalism

PART 1: POLITICAL ECONOMY

CHAPTER 1: Capitalism Shakes the World The Permanent Technological Revolution Which Came First: Technology or Capitalism? The Enrichment of Material Life Growing Inequality The Population Explosion and the Growth of Cities The Changing Nature of Work The Transformation of the Family Threats to the Ecosystem The Effects of Climate Change Contamination New Roles for Government Globalization Conclusion

CHAPTER 2: People, Preferences, and Society Constraints, Preferences, and Beliefs "Economic Man" Reconsidered Human Nature and Cultural Differences The Economy Produces People Conclusion: The Cooperative Species

CHAPTER 3: A Three-Dimensional Approach to Economics Economic Systems and Capitalism Three-Dimensional Economics Competition Command Change Neoclassical Economics Values in Political Economy Efficiency Fairness Democracy Balancing efficiency, fairness, and democracy Conclusion

CHAPTER 4: The Surplus Product: Conflict and Change Economic Interdependence, Production, and Reproduction Production Links Between Production and Reproduction A Labor Process Example: Making Pancakes The Surplus Product A Model of Production and Reproduction Who Gets the Surplus? Enlarging the Surplus Application of Model to Labor The Surplus Product and Change Conclusion

CHAPTER 5: Capitalism as an Economic System Class and Class Relationships Classes and Economic Systems Slavery Feudalism Distinctions among Economic Systems Capitalism Commodities Privately Owned Capital Goods Wage Labor Capitalism, the Surplus Product, and Profits Conclusion

CHAPTER 6: Government and the Economy Rules of the Game: Government and the Capitalist Economy The Emergence of Modern Legal Forms of Corporate Business From Competition to Monopoly From National to Transnational Democratic Government as Collective Provision for the General Welfare Government and the Distribution of Income, Wealth, and Welfare in the 19th Century Contention between Capital and Labor over Rules Voter turnout in the U.S. and around the world Democracy in the 20th Century Conclusion

CHAPTER 7: U.S. Capitalism: Accumulation and Change Accumulation as a Source of Change The Accumulation of Process Competition for Profits Social Structures of Accumulation Changing Strategies for Profit-Making Consolidation and Decay of an SSA The Stages of American Capitalism in the United States Competitive capitalism (1860s-1898) Competitive capitalism (1860s-1898) Corporate capitalism (1898-1939) Regulated capitalism (1939-1991) Transnational capitalism (1991- ) U.S. Capitalism: Labor Organizing and Labor Markets The Rise and Fall of Labor Unions Segmented labor markets U.S. Capitalism Today is Transnational Immigration Shifts in what U.S. Labor Produces Fragmenting Global Production Rules for the Global Economy Tax Motives for TNCs to Go Global Corporate Stock Buybacks and Falling Productive Investment Conclusion

PART 2: MICROECONOMICS

CHAPTER 8: Supply and Demand: How Markets Work The Nature of Markets Demand and Supply Demand Supply Demand and Supply Interacting Shifts in Demand or Supply Conclusion

CHAPTER 9: Competition and Coordination: The Invisible Hand Adam Smith and Laissez-Faire Economics Coordination Coordination by Rules and by Command The Limits of Coordination by Command The Invisible Hand The Invisible Hand in Action Problems with the Invisible Hand Market Failure Negative externalities as market failures Positive externalities as market failures Monopoly as a market failure Coordination Failure The Prisoner's Dilemma and the Benefits of Cooperation The Tragedy of the Common Conclusion

CHAPTER 10: Capitalist Production and Profits What Are Profits? Profits from a Production Process Calculating Profit and Other Property Incomes in the Whole Economy Profit in a Grain-Growing Capitalist Economy Calculating the Rate of Profit The Corporate Profit Rate in the U.S. Corporations and Other Businesses: Who Gets the Profit or Bears the Loss? Corporations Determinants of Total Profit and the Profit Rate Example: The Good Cod Fishing Company Profit per Unit of Output Conflict Over the Profit Rate Intermediate Inputs per Unit of Output as Profit Rate Determinants Unit Labor Cost as a Profit Rate Determinant Understanding the Profit Rate Conclusion

CHAPTER 11: Competition and Concentration Competition for Profits The Forms of Competition Price Competition Price as a markup over cost Economies of scale and price competition Other advantages of large size Capacity utilization Breakthroughs Monopoly Power Investing to Compete The Dynamics of Competition Toward Equal Profit Rates? Toward Economic Concentration? Large Size and Monopoly Power Trends in Concentration Antitrust Enforcement Conclusion

CHAPTER 12: Wages and Work Work, Sloth, and Social Organization The Capitalist Firm as a Command Economy The Conflict between Workers and Employers Labor Discipline: Carrots and Sticks The Labor Market, the Wage, and the Intensity of Labor Cost of Job Loss Avoiding the Cost of Job Loss Additional Implications of the Labor Extraction Curve Conclusion

CHAPTER 13: Technology, Control, and Conflict in the Workplace The Social Organization of the Workplace Simple Control Technical Control Bureaucratic Control Technology and the Labor Process Conflict in the Workplace Technical Change and Workplace Conflict Unions Discrimination in the Workplace Profitability Versus Efficiency Markets and Hierarchies Democratic Firms Conclusion

PART 3: MACROECONOMICS

CHAPTER 14: The Mosaic of Inequality Well-Being and Inequality Influences on Well-being and the Economy Measuring Living Standards and Inequality Growing Inequality Wealth Inequality Unequal Chances Race and Inequality Discrimination in Hiring Problem of Differential Pay Women's Work, Women's Wages Conclusion: Explaining the Mosaic of Inequality

CHAPTER 15: Progress and Poverty on a World Scale Poverty and Progress Productivity and Income Vicious Circles of Low Productivity Intellectual Property Rights Other Government Interventions to Promote Development Requisites for Economic Development Eight Essential Conditions Other Factors in Development Foreign Investment and Development Investment Decisions by Transnational Corporations Transnational Investment and Tax Havens The High Cost of Low-Priced Clothing Conclusion

CHAPTER 16: Aggregate Demand, Employment, and Unemployment Counting the Unemployed What Determines Employment and Output? Aggregate Supply and Aggregate Demand Measuring Total Output Terms for Measuring the Macroeconomy Measuring Aggregate Supply and Aggregate Demand A Basic Macroeconomic Model Unemployment and Government Fiscal Policy Effects of Deficit Spending on Employment Multiplier Effect of Deficit Spending The Business Cycle and the Built-in Stabilizers Conscious Policy Changes Automatic Built-in Stabilizers Investment, Aggregate Demand, and Monetary Policy Wages, Aggregate Demand, and Unemployment When is an Employment Situation Wage-Led? Implications for Economic Policy Conclusion

CHAPTER 17: The Dilemmas of Macroeconomic Policy The High-Employment Profit Squeeze The High Employment Wage Push The Materials Cost Push The Profit Squeeze Exports, Imports, and Aggregate Demand The Demand for Exports and Imports The Foreign Exchange Rate International Trade and Macroeconomic Policy Promoting Net Exports Competing in Global Markets Monetary and Fiscal Policy at Odds What Determines the Interest Rate? Borrowing and the Exchange Rate The Conflict between Monetary and Fiscal Policy Institutions for Achieving Full Employment Institutional Obstacles to Full Employment Institutions for Achieving Full Employment Conclusion

CHAPTER 18: Financial and Economic Crisis The Great Recession and the Subprime Crisis Understanding the Great Recession Why to Buy a Home Home Prices Start to Rise How to Buy a Home Securitization of Mortgages Refinancing Deregulation Liars' Loans Collateral Damage Derivatives of Other Kinds Bailouts and Buyouts Unemployment and Poverty Lessons from the History of Economic Crises Nonfinancial causes of crisis: over-investment, under-consumption Underconsumption as a cause of stagnation or crisis Asset markets differ from goods markets Why are asset markets prone to price bubbles? Feedback Loops Reflexivity Misinformation Deregulation and financial fragility Large firms exacerbate the problem Weakening the social safety net Regulation in a capitalist economy Regulating the financial sector The Dodd-Frank Act Inequality, concentration and crisis Conclusion

CHAPTER 19: Government and the Economy in Transnational Capitalism More Spending, Less Health Government in the U.S.: Too Big? Government Spending: Comparing the U.S. with Other Countries Old age pensions Influencing the Rules Taxation Rules that Affect Business Costs and Profits Contracting Out Government Services Government Contracting: Profits and the Public Interest Decline in Competitive Bidding for Government Contracts Government Contracting for Private Prison Services Laws and Norms on Sentencing Rethinking Private Prisons and Mass Incarceration Selling to Government, Maximizing Profit Medical services in Private Prisons Changing the Rules Feedback Loops in Taxing Transnational Corporations Conflict Over Rules Proposals for Alternative Rules Democracy and Inequality Feedback Loops Between Inequality and Power Supranational rules and rule changes TNC Power over Foreign Government Decisions Conflict Over Rules Proposals for Alternative Rules Capitalism and Inequality Democracy and Inequality Conclusion

List of Variables Sources of Economic Information Glossary Index