To what extent must society shape capitalism?

Another post from a self-proclaimed economy non-expert.

This post is one big question mark, just so you’re aware!

I am sure that most of us, even the most right wing, would agree that capitalism is most effective – from a utilitarian point of view – when tempered to an extent by social forces. These may be ethics, the metaphorical workers’ rights of the marketplace; regulation, the health-and-safety handbook; economic progress, the constitution and philosophical goals of capitalism; trading law, the global rules of operation; process, the top-level efficiency of the capitalist system; communication and diplomacy, the oil in the machinery; the list could go on.

In fact if that list were to go on, it would become less and less directly related to capitalism, and the metaphors would become more and more broad. This is because capitalism itself eventually gives way to the aspects of society that surround it. For example, business ethics are informed by the aspects of global/local society that feed it, namely politics, environment, art, national and regional development, media, and so on. I hope to have explained this point as a construct rather than a view, as it exists whatever one’s views on the autonomy of capitalism within a state are. Whether you believe capitalism should be capitalism and completely uninformed by society, I am attempting to at least define the interdependence that could, does, should, or should not exist.

Which leads me to the point of writing this. As a layman I’m totally ignorant as to the schools of thought that define these boundaries. If anyone reading this knows of some studies on the interdependence between capitalism and society, I’d really appreciate a reading list. Or maybe even just a quick summary, or some keywords or authors I can search. Specifically the questions I have are as follows.

Most ‘moderates’, as I would consider them, believe that a marketplace should have a good degree of independence, but that there should be some healthy acknowledgement of the surrounding world. National politics usually define regulations, international consortia define trade law, but my question is to what extent should free market ethics be defined by society? A business should be able to use its powers to create a market and generate demand where there isn’t any, but the equal and opposite is that a business should also be able to use its power to close down a market, reduce demand, force down wages, etc. The obvious questions of business ethics arise from this example of irregularity. More importantly than “to what extent should free market ethics be defined by society”, is “who theoretically makes that decision” (this is rhetorical because it’s the powerful who end up making it), and “what system of rationale governs who makes the decision”?

I guess there are inevitably no answers to the above questions, but I am interested if there’s any research in these more esoteric areas.

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