What are the 2 types of capitalist crisis?
1) Overproduction crisis
2) Excess demand crisis.
What is an overproduction crisis?
Too much is produced to be sold profitably.
What is an excess demand crisis?
Demand is higher than supply → shortages / prices rise / not enough goods.
What is Say’s Law (shortest version)?
“Supply creates its own demand.”
Producing goods generates incomes that (in theory) create demand to buy them.
Competition/market pressure makes it difficult to follow
We don’t (or can’t) fully follow Say’s Law which leads over production
How does capitalism often view wages?
As a cost (something to minimise).
Why might higher wages be seen as an “opportunity”?
They increase purchasing power → more demand → easier to sell output.
Why is it “difficult” for firms to raise wages?
They may lose competitive advantage vs firms keeping wages low.
What problem does capitalism create by treating wages as a cost?
It can reduce purchasing power → weaker demand → contributes to overproduction.
Why might minimum wage be called a “restriction of freedom”?
It limits how low employers can set wages (limits market freedom)
What does “cost vs investment” mean here?
Some spending looks like a cost short-term but pays off long-term (investment).
Need to balance short-term and long-term effects.
Why does inequality create instability ?
Less purchasing power for many people → weaker demand / social tension.
What are “shareholder initiatives” ?
A: Actions/proposals from shareholders to influence company behavior.
What do your notes claim about long-termism in companies?
Long-term focused companies do better in revenue/profits/earnings.
What does “companies have to report quarterly earnings” lead to?
Short-term pressure and short-term transparency.
What creates more long-term transparency ?
Shareholder voting rights.
What is “economic freedom”?
A: Freedom to participate in markets with minimal restrictions.
What affects voting rights?
Length of ownership influences voting rights.
List the components of economic freedom.
Freedom of enterprise; free movement of factors of production; freedom to hire/fire; freedom of trade; private property.
Why is there no absolute freedom?
One freedom often comes at the expense of another (trade-off).
Where do we “receive” freedom?
From our political system (laws/institutions).
Negative vs. Positive Freedom
Negative Freedom: Freedom from interference/constraints. (capitalism supports)
Positive Freedom: Freedom/capacity to actually do things (having real means/resources).
Why might capitalism oppose UBI?
It believes basic needs must be earned.
What is the “freedoms paradox”?
Expanding one type of freedom can reduce another (trade-offs).
what’s the chain from supply to demand?
Supply → production → labour → salary → purchasing power → demand.
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Financial Bubbles11
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Session 01: Systemic & Critical Thinking20
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Session 02: Systemic Thinking22
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Session 03: Systemic Thinking35
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Session 04: Systemic Thinking26
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Session 05: Systemic Thinking9
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Session 06: Systemic Thinking20
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Session 07: Systemic Thinking8
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Session 08: Systemic Thinking19
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Session 09: Systemic Thinking8
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Session 10: Systemic Thinking16
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Readings & Authours9
