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So whenever people hear that we're teaching this course,
they come up to me and they say, well, you're
teaching this course about capitalism.
What is capitalism?
Give me a definition.
So what is it?
Yeah, and capitalism is extremely controversial to define.
There are elements that everyone agrees on,
the sort of reorganization of labor, especially division of labor,
the investment of money in terms of capital investment for higher
productivity, the relationship between the state
and markets in terms of protecting private contracts and private property.
But after that, people begin to disagree pretty wildly.
Anytime you try to come up with a recipe,
there's always another perspective on it.
I mean, you could look at these geniuses who we, in turn, look
to as the fathers of the different theories about what capitalism is,
somebody like Adam Smith who says, it all comes down to having free markets.
Or Karl Marx, who says, once you have a real system of wage labor
and commodities, that's capitalism.
Or Joseph Schumpeter, who said, capitalism
is simply letting entrepreneurs do their work of creative destruction.
All of these are really fixed pictures in a way.
And they don't really take account of the constant flow of change
that we see in capitalism.
They're attempts to get a sense of what that is, but they don't quite make it.
I mean, I think what strikes me always is
that there are few things that are different-- this idea
of a radical break with Malthus, this idea of reinvestment,
the use of natural resources, the ability to reorganize labor
in new ways, long distance trade that produces new kinds of economic growth.
But at its core, what's fascinating is that even as some things are
held constant, the economic institutions,
the political institutions, the social relations that
are built upon these core components looks totally different over time.
And in fact, that's what really matters, the everyday
lived experiences of people within capitalism.
What this means is that everybody's going
to have a different relationship to capitalism.
Whether you identify yourself as a worker, or as an entrepreneur,
or as a politician, you're going to be touched
by, and in fact, shaped by capitalism.
And you're going to play a part in shaping that.
But your idea what it is, is going to be different,
because it's a much bigger, constantly changing process
that all human beings have been shaped by
and have been living in for, really, a couple of centuries now.
And so it matters less to define capitalism, like a philosopher would,
because in essence, that is not what matters.
What matters is how capitalism has emerged historically,
transforming our world.