I have described the 4 economic systems and compared the position of a “worker” under each.

I’ve also described the 2nd slave stage in some detail.

The first stage is characterized by the invention of the state. This signals an end to total war.

The second stage arises as soon as people recognize the benefits of specialization and trade between their tribes. Specialization between firms is distinct from division of labor within firms.

The latter develops during the third stage as part of purely technological progress. The complex capital goods require complex worker skills. 2nd-stage slavery is revealed as unsuitable for the task of the empowerment of workers, since it does not supply the proper incentives to workers; and is burst asunder, giving birth to feudalism.

The final capitalist stage arises when capital accumulation has reached a certain level. When capital is very scarce, there is no particular need for entrepreneurial freedom to easily shift capital from one project, factory, location, and purpose to another. It became necessary for goods to move easily from place to place and from owner to owner. Labor, too, needed to become highly mobile, an ideal which helped fully to abolish feudal serfdom. Lower transportation costs offer invaluable help. The development of economics as a science helps people to grasp the advantages of laissez-faire and market process, and the resulting ideological revolution at this stage releases all of society’s “productive forces.”

And that’s it. There is no “progress” past laissez-faire capitalism.


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