Thursday, May 10, 2012

Capitalism: My definition

Capitalism is the system where people make money out of money, by lending or investing it and where te most crucial resource for starting and operating a business is financial (monetary) capital.

The transition from manufacturing and other industry to services as well as intellectual (largely non-tangible, non-material) products was supposed to gradually decrease the importance of financial capital in starting and operating a business (services or intellectual products such as music, books/ideas etc) and increase the importance of labour-human capital and the grey matter.

For many reasons, this has not happened. I have and will continue to tweet and blog on the reasons (eg here). In this post I want to emphasize that the extra-time that Capitalism as I defined it has got has produced some  really weird dynamics. Is the strategic option for the US and the EU to save and even regain manufacturing from Japan, China et al, or to learn how to live in a post-industrial era (at least for the "West")?

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