Economics: the allocation of good and services in a situation of scarcity of resources

Economies are either communitarian or market

Communitarian Economy: society itself takes care of production and distribution of goods and services. Contrary to classical Marxist theory, this is not the "original state" of society, but a cultural achievement.

• Is it ethical? In form, there is nothing wrong with this type of system. Philosophers have criticized communitarianism because it treats justice as equality (equal distribution), instead of giving each their due.
• In practice: open to abuse and encroachment on other spheres of life.

Market Economy: good and services are exchanged in the marketplace, which is either physical or ideal. (what is the situation in our country?)

• The three features of a market system are: (1) private ownership of resources and goods and services; (2) voluntary exchange; (3) "profit motive"-the idea that people enter the system solely to advance their own well-being. (The so-called "rational" behavior.)
• No such thing as a pure market economy: state usually intervenes in different ways.
• Capitalism is a form of market economy. In capitalism the marketplace decides what good and services to produce, how to manufacture and sell them, their price, etc through the forces of supply and demand.
• According to Max Weber, capitalism's chief feature is the "rationalization" of profit making by adding techniques of measurement. (Ex: Ted Turner's list of millionaires)
• Is it ethical? I would say that, like communitarianism, capitalism is a neutral instrument. There is nothing wrong with private ownership, voluntary exchanges, solely advancing your own well-being, letting the market decide economic decisions, or rational measurement. I know of only two critiques of capitalism that claim it is immoral as such: (1) the Marxist critique (which bases its view on the immorality of private property, which is derived from Marxist metaphysical views) and (2) the suggestion that there is something unchristian about being a merchant ("homo mercator nix aut nunquam potest Deo placere," and injunctions against usury). However, our economic systems were grown in the bosom of Christian civilization-beginning in the 11th Century, accepting Christian principles from the beginning
• The basic rules of the market system are (1) to behave rationally (meaning in your self-interest), and (2) to treat everyone in an impersonal, honest and objective way. There is nothing immoral about this, however, it doesn't automatically rule out any exchange. Ethical criteria separate from the market must be used to outlaw certain exchanges, if such is the wish of society. For example, slave traffic, prostitution, and drug dealing.

Moral justifications of the Capitalism

The idea: the market itself is not moral or immoral, but rather neutral. It is merely a system of exchange. However, the question of its justice or morality can still be asked from the point of view of people who choose to use it. Are there any moral reasons to embrace Capitalism, and is this the best choice of all possible other choices? (The ethics of neutral objects-the intentions and circumstances can make the choice bad. There is nothing wrong about brushing your teeth, nor is there any moral obligation to do so; however, brushing you teeth instead of rescuing a drowning person when you could would be a moral infraction.) In fact, in America, we believe that capitalism is both economically and morally superior to other possible economic systems.

Two different moral justifications:

1. Broadly utilitarian justification: capitalism produces the highest possible level of welfare or well-being for society. (Identifies the results of market economy with well-being.)
2. Rights justification: Capitalism best protects individual liberties.