Exam questions

Question 1

Marx: industrial capitalist system

Answer 1

• market is a central component of capitalism, strives for unlimited accumulation w/o regard of humans
• will conquer the whole world & all domains, it will cause a concentration of richdom & small firms’ll be out-competed
• a tension between entrepreneurs & workers
• will be destroyed through its own success & its refusal to share profits with labor (class struggle)

Question 2

Weber: rational capitalism

Answer 2

• it is the systematic & rational pursuit of legitimate profit, calculated rationality
• “capitalist spirit” is economic ethic based on longterm (re-/)investment for success
• Profit is pursued in a systematic and rational manner
• He feared the danger of bureaucratization
• entrepreneur = “the putter-out”, they motivate laborers and it is free labor

Question 3

Keynes: irrational capitalism

Answer 3

• economic actors aren’t purely rational: only have imperfect info at their disposal
• act out of trust & animal spirits (emotions, instinct) –> speculation can cause market fluctuations
• challenged the traditional view of capitalism as a self-regulating system: capitalism could remain in state of underutilization & unemployment for extended periods if not actively managed through government intervention

Question 4

Schumpeter: irratic capitalism

Answer 4

• private property in which innovations are carried out
• creative destruction & innovation causes economic growth
  –> process of creative destruction & re-organization = essential to capitalist dynamic
• Marked by business cycle with crises

Question 5

Kocka: neutral analytical concept:

Answer 5

• capitalism = economic system based on individual property rights & decisions where capital is crucial
• It is an market economy, mechanism of decentralized decision making through competition & cooperation
• key fts. Incl. private property, market exchange, profit orientation, wage labor
• emphasizes capitalism’s historical variability, adapting across time & space