Not only that, but “Denmark isn’t just the most free market economy, and the most egalitarian, and the most civic-minded, and the happiest. It’s also the most entrepreneurial.” This is important for future growth:
The basic premise is that entrepreneurial capitalism is especially important when a country is near the technological frontier, and when there is great uncertainty about which products to produce, and how to produce them. And that means that free market policies that promote entrepreneurship are now more essential than ever.Could it be that pirates believe in (a little) law and order, or do they only believe in the Kuznets curve? In part the argument being made is that you need markets in order for piracy to pay, so you need basic laws and public goods to make piracy profitable, just not so much as to really put a stop to the better organized crime syndicates.
To see the distinction between the “what to produce” and the ”how to produce” questions, consider Viagra and Facebook. Viagra was a product for which the need was well understood (as rhinos have learned to their dismay) but where it was not understood how to produce the product. Facebook was a discovery of a need that had been heretofore overlooked. Entrepreneurial firms are especially good at solving these sorts of questions, although that doesn’t necessarily mean the firms must be small (as we saw with Viagra.) Central planning is relatively good at producing steel and washing machines and apartment buildings–well understood needs with easy to follow blueprints for production. …
Just for fun on the topic of questioning America's commitment to capitalism, an over-reading of Goodnight Moon sees it as an allegory of human alienation. The format is exceptionally nihilistic, as “good night” is said to capitalism and communism, motherhood, and everything else. This anti-capitalist rant recently read to us by ... former Bush advisor, Mankiw. If even the vast right-wing conspiracy is secretly subverting capitalism with nihilistic children's literature, we're in trouble.