Common Good, Private Purposes.

Module 2, Lesson 2.1: The Good: Competition, Prices, & Entrepreneurship (Friedrich Hayek)


In this first lesson of Module 2, Associate Professor Paulo dos Santos discusses the good in capitalist economies by introducing two notable political economists who argued that markets, competition, and well-functioning price systems are the best ways for an industrial society to organise itself: Adam Smith and Friedrich Hayek. This video focuses on Friedrich Hayek.

By the end of this video (2/2), learners will be able to:

  • Explain Hayek’s argument that the market process, entrepreneurship, and price systems offer the best way to deal with the problem of dispersed economic knowledge in an interdependent economy
  • Discuss ways in which the pursuit of high profitability may result in socially harmful outcomes