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Towards a Well-functioning Economy

The Evolution of Economic Systems and Decision-making Louis Haddad, formerly Honorary Research Fellow, Department of Economics, University of Sydney, Australia
This thoughtful book will be of interest to economists of economic theory and economic systems as well as policymakers in both the private and public sectors.
Extent: 304 pp
Hardback Price: $145.00 Web: $130.50
Publication Date: 2002
ISBN: 978 1 85898 892 4
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  • Economics and Finance
  • Methodology of Economics
This book examines the economy as an evolving entity and develops a new and coherent approach to the classification of economic systems. It demonstrates how the components of a decision-making system and the properties of a functioning economy are intrinsically linked. A well-functioning economy is shown to depend chiefly on ‘correct’ decisions. These in turn depend on an efficient decision-making system, an appropriate mix of markets, organizations and governments, and an optimal combination of the four enforcing mechanisms of a modern economic system: custom, command, competition and cooperation.

Although this book is primarily about economics, non-economic considerations, including politics and ethics, are brought into the analysis. The most important decisions in life include choices between economic and non-economic issues. Hence, one of the aims of this book is to provide a conceptual framework to cope with these choices. The book also attempts to establish some plausible conditions for well-functioning economy and a ‘just society’.

This thoughtful book will be of interest to economists of economic theory and economic systems as well as policymakers in both the private and public sectors.
‘It is an ambitious attempt to define different sorts of societies from the point of view of the roles of their principal decision-makers, to design an optimal society coming from the same point of view and to point out the pitfalls on the way to establishing such a society. Haddad is a humane and democratic person and his ideal society is an admirable one. He has thought long and hard about both the pitfalls and the advantages of what he proposes. He provides a novel framework within which to attempt both the actual and potential. Haddad is aware that hard-nosed cynics will sneer at him and his ideas but he is also an optimist who believes that good sense and good will may flourish in an appropriate environment. Certainly his book should be in the public domain in a democratic society for it provides the basis for serious and fundamental discussion of ethics, economics and politics.’
– G.C. Harcourt, University of New South Wales, Australia
Contents: Preface 1. Introduction Part I: Economic Systems and Decision-making 2. Structures of Decision-making 3. Decision-making Procedures 4. Structures of Information Flows 5. Decision-making Criteria 6. Types and Structures of Incentive Part II: The Evolution of Economic Systems 7. The Customary Economy 8. The Command Economy 9. The Competition Economy 10. The Composite Economy Part III: Towards a Well-functioning Economic System 11. The Principles of a Well-designed Decision-making System 12. The Properties of a Well-functioning Economy 13. The Decision-making Process of a Well-functioning Economy 14. Concluding Notes on the Problems of Transition to a Well-functioning Economy References Index