There are 7.35 Billion people in the world (2017 - Google) and I do believe in Adam Smith's Invisible Hand - that one person working in their own self-interest is likely to be the same with many people. But I never cease to be amazed at all the different ways people answer the questions of what to produce, how to produce and for whom to produce.
The same goes with economic systems. The Circular Flow Model with government is pretty standard in the world - but there are so many little differences. Differentiating what is the "real capitalism" is like judging which snow flake is prettiest. They are all unique.
That is why Douglass North's work to help us to look at differences in economic systems, and be able to judge if an economy will thrive or dive - helps. The differences are interesting.
I mentioned that I was in Cuba in the summer of 2018. I was fully prepared for a complete command economy - where the government answered the 3 basic economic questions. I was completely dumbfounded within an hour on the ground that Cuba has established markets, where buyers and sellers can freely meet and exchange goods and services. Though "cash" in Cuba is a bit tricky. Mind you - you could go to roadside markets to buy food, but you also had government markets that you had coupon books to give you a food allotment - roughly 800 calories a day. Not really enough to thrive.
I also was completely surprised at the amount of entrepreneurship - male and female - in the country. The Cubans had a work ethic I'd put up with Americans.
BUT, Cuba must overcome the problems with private property (which has a complicated relationship with government / public and private ownership) and is very inefficient. Also, Rule of Law is an issue. I didn't directly witness it, but in speaking with people, I heard that the rules for foreigners - who were going to be investors in the country - i.e. Chinese and Vietnamese - were allowed more freedoms and weren't as subject to law and order as I was as an American in Cuba. In other words, there were things I could not do because I was an American that Chinese could do.
I also have to say that the discussion on Thursday about income inequality was top notch. It was a discussion I would've looked for in a college class. The variety of observations I heard really had me thinking - I went to bed that night still considering what I heard. Fascinating.
So, have fun studying what capitalism means in different countries this week. Next week, how potato chips can teach us about marginal benefit and cost.
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