Short answers about Introduction to Political Economy Essay - 3

Short answers about Introduction to Political Economy - Essay Example In a bid to take over the market, firms enhance internal efficiency, adopt new technologies, invest in innovations, and reduce inefficiency on managerial level (Office of Fair Trading 6). In the economic systems that are based on free markets, the latter are major determinants of market outcomes. In the situation when the market failure occurs because of the fact that this market’s quality, price, or quantity do not meet established social welfare norms, economic regulation is used. Its major aim is to prevent market failure. It is desirable since it prevents the market failure (Jacobs & Rapoport 353). The major difference between capture theory and public interest theory is that the latter believes that regulation is inherently effective: it leads to the society getting better off. By contrast, capture theories assert that regulation works in the interest of a particular group which has succeeded in making its case to some regulatory agency or some legislative body (Hovenkamp 133) In his Communist Manifesto, Karl Marx lists 10 steps needed to destroy the system of free enterprise and replace it with system of all-powerful governmental rule. This will bring in the communist state. These steps of 10 Planks of The Communist Manifesto are 1) abolition of private property and giving all land rents for public use; 2) a heavy progressive (or graduated) income tax; 3) abolition of rights of inheritance; 4) property confiscation from all rebels and emigrants; 5) centralization of credit in the state’s hands through national bank; 6) centralization all transportation and communications in the state’s hands; 7) factories’ extension; waste lands’ cultivation; 8) equal liability of all people to labor; 9) agriculture and manufacture combination, as well as equitable population distribution around the country; 10) free education in all public schools (Sims 194). The earliest position in the timeline of