
Here is Hans Hoppe’s first treatise in English – actually his first book in English – and the one that put him on the map as a social thinker and economist to watch. He argued that there are only two possible archetypes in economic affairs: socialism and capitalism. All systems are combinations of those two types. The capitalist model he defines as pure protection of private property, free association, and exchange – no exceptions. All deviations from that ideal are species of socialism, with public ownership and interference with trade.
Within the structure of socialism, he distinguishes the left and right version. “Conservative” socialism favors high regulation, behavioral controls, protectionism, and nationalism. The “liberal” version tends more toward outright public ownership and redistribution.
The consequences of socialism vary based on their degree and kind, but they have similarities: high costs, resource waste, low growth.
This treatise has long been out of print, but is now avaiable again for use in comparative systems classes and for an orientation to the theory of economic systems. The theoretical apparatus is Rothbardian to the core, and its main contribution is to provide an organizing principle for understanding the structure of real-world economies as measured against pure types.
A tour de force.
This edition preserves the formatting from the original publisher, for reasons of citation. Though it was published by a major academic publishing house, the visuals are not what they might have been. Nonetheless, the book is well cited and this edition makes it possible to navigate those citations.
289 pages, paperback, 2007



{ 12 comments }
At long last!
Thanks for making this available. I have been wanting it for some time.
If you have ever seen the original you know that the typesetting is not what you might expect from Mises Institute. What we did was merely shoot the original , and the academic publisher didn’t do what it should have done. Nonetheless, rather than wait for a completely redone version, we decided to feed the market demand and go with what we have — once the author cleared up the ridiculous copyright issues with the orig. publishers. Authors: watch out for horrible contracts that end up burying your work! The publisher can hold on for an eternity and price your book out of the consumer market.
Wonderful. I ordered a copy the second I saw this. Thanks so much to the institute for making this available!
Outstandng!
“The consequences of socialism vary based on their degree and kind, but they have similarities: high costs, resource waste, low growth.”
That’s pretty much incorrect… and I’m not sure what its doing in this article. Eliminate “economies” and you don’t have “costs”. And if you meant ECONOMIC “growth”… yep, properly-done, fully-installed socialism/commune-ism… doesn’t grow in that way. It grows in intelligence, logic, efficiency, and morals. Its a different kind of growth. We haven’t yet seen socialism or commune-ism ever completely installed anywhere on the planet in mankind’s history.
Wingnut
MaStars – Mothers Against Stuff That Ain’t Right
(anti-capitalismists)
Bessemer MI USA
…and the sea will be made of lemonade and roasted chickens will fly into everyones mouths.
The ‘nut’ part is certainly correct.
ahhhhhh, name-calling by Inquisitor again. I see a trend.
Mises.org wrote:”The capitalist model he defines as pure protection of private property, free association, and exchange – no exceptions. All deviations from that ideal are species of socialism, with public ownership and interference with trade.
“Within the structure of socialism, he distinguishes the left and right version. “Conservative” socialism favors high regulation, behavioral controls, protectionism, and nationalism. The “liberal” version tends more toward outright public ownership and redistribution.
“The consequences of socialism vary based on their degree and kind, but they have similarities: high costs, resource waste, low growth.”
I think this is wrong in many details (and in the general thrust). Capitalism in fact works *against* free association. It forces most human relationships to be affected by one’s own relationship to private property. One of its key institutions, the family unit, functions to reproduce hierarchical behavioural patterns and remove much of the responsibility for taking care of the aged, sick and the next generation of workers from society, to the family unit (ie, generally women). Thus capitalism also requires the oppression of women and the idealisation/mystification of the historically recent “nuclear” family unit – and hence also homophobia.
Capitalism divides workers amongst themselves with tools such as racism and xenophobia, convincing workers that they have more in common with the bourgeoisie of their own country than they do with workers in other countries.
Secondly, I don’t think that it can be held that communism is more wasteful than capitalism. Capitalism after all, requires the invention of entire industries which offer little social value, but take up considerable resources (for instance, the advertising industry). It has been responsible for ridiculous consumerism which aims to sell people products which they don’t really need, and is already a significant cause of environmental degradation, particularly in the world’s oceans.
Capitalism, and its anarchic logic, favours maximising profits at the expense of sustainable innovation and ecological conservation. Built in to the capitalist system is its regular crises of overproduction, which means capitalism without regular recessions and depressions is impossible.
Capitalist “growth” is insufficiently geared to growing our society in the areas where it is really needed, and tends more to be about expanding corporate profits. Do we really think that under socialism, anyone would buy up patents of innovative products in order to maintain the profitability of their own, inferior, product by delaying the development of the newer one?
I think “First World rulers fiddle while Arctic melts”, by Direct Action’s Shua Garfield, also provides another powerful motivation for getting rid of this capitalist order: http://www.directaction.org.au/issue5/first_world_rulers_fiddle_while_arctic_melts
It’s certainly the case that thus far, countries attempting to change to socialism have been impeded by their isolation (and, in Cuba’s case, by the criminal economic blockade imposed by the US) and inexperience (and, in the case of the USSR, 18 other countries invading them which was partially responsible for distracting the Bolsheviks while a bureaucratic caste formed).
Marxist socialists have always understood that true communism is not possible on a national scale, but can only come into being through worldwide revolution. The task of all those desiring progressive change is to do what we can to ensure that the causal factors of problems of previous revolutions are minimised as much as possible – and to rigorously study, assess and debate these experiences, so that we don’t just accept bourgeois assessments of what went wrong.
“What is revolutionary socialism?”, by Allen Myers, is also a useful read: http://www.directaction.org.au/issue1/what_is_revolutionary_socialism
VirginiaB,
all I can say is wow! You are so wrong on so many counts. All I can say is read Mises and Hayek on why socialists can not maintain a standard of living. Read up on how the elimination of prices in the capital goods industry leads to starvation. Read about how central planning leads to decreased living standards, falling populations, and general misery for all subject thereto. Extending central planning across the breadth of the world would just impoverish the entire species of humankind. Please take your socialism and practice it with your socialist comrades in a non aggressive manner. If you can convince people to voluntarily give up the gifts of free enterprise, more power to you, but do not use force to keep them once they see the fraud of socialist planning, the stagnation and lower rate of psychic gain. Do not enslave your fellow man, but rather live your false utopia in peace with your fellow man. When you have exhausted your capital and find no more willing participants in your charade, you will be more than welcome to rejoin the free market.
VirginiaB: “Capitalism in fact works *against* free association. It forces most human relationships to be affected by one’s own relationship to private property.â€
One of the characteristics of capitalism is free association, as the author writes, but by that he means that no other person or the state forces people to associate with other people. That doesn’t mean that other things, such as wealth, distance, gravity, time, charm, looks, profession, etc., will not restrict association. The type of free association without any limitations whatsoever is impossible in this life.
VirginiaB: “One of its key institutions, the family unit,…â€
That’s not an institution of capitalism, but of traditional values. However, they do tend to go together.
VirginiaB: “…functions to reproduce hierarchical behavioural patterns and remove much of the responsibility for taking care of the aged, sick and the next generation of workers from society, to the family unit (ie, generally women).â€
On what grounds do strangers face the requirement to take care of your family members? Traditional values, even in communist countries, place the main burden on family members.
VirginiaB: “Thus capitalism also requires the oppression of women and the idealisation/mystification of the historically recent “nuclear” family unit – and hence also homophobia.â€
Capitalism is an economic system, not a moral one. It has very little to say about treatment of women or homosexuals. Again, those are traditional values, not economics.
VirginiaB: “Capitalism divides workers amongst themselves with tools such as racism and xenophobia, convincing workers that they have more in common with the bourgeoisie of their own country than they do with workers in other countries.â€
The principle of the division of labor in economics creates harmony among all workers and owners by demonstrating their dependence on each other. The fevered imagination of Marxists pits workers against owners.
VirginiaB: “Capitalism after all, requires the invention of entire industries which offer little social value, but take up considerable resources (for instance, the advertising industry). It has been responsible for ridiculous consumerism…â€
Who gets to define “social valueâ€? You? The head of the communist party? Capitalism allows each person to decide for himself what is socially valuable and to vote for it with his dollars. You may not like advertising or what your neighbor buys, but who gave you the authority to decide that they shouldn’t? Besides, the old socialist idea that advertising forces people to buy things they don’t want has been proven wrong by research dozens of times.
VirginiaB: “Built in to the capitalist system is its regular crises of overproduction, which means capitalism without regular recessions and depressions is impossible.â€
You’re quoting Marx, whose economics was proven wrong before the ink had dried on his book. Had Marx understood economics, he would have known that business cycles are caused by artificial changes in the money supply resulting from state-granted monopolies on banking and money creation. In a real capitalist system, these cycles would virtually disappear.
VirginiaB: “Capitalist “growth” is insufficiently geared to growing our society in the areas where it is really needed, and tends more to be about expanding corporate profits.â€
Again, who will decide what is needed? Under capitalism, every consumer is free to help make the decision by voting with his dollars. Under socialism, a small elite decides. Expanding corporate profits are evidence of how individual citizens have voted with their dollars.
VirginiaB: “Marxist socialists have always understood that true communism is not possible on a national scale, but can only come into being through worldwide revolution.â€
Marxists are true believers in that no amount of evidence to the contray will change their minds. The USSR tried socialism for 80 years and China tried for 50 years and both failed. The USSR lived in relative peace for 40 years after WWII as did China, but they still failed. They failed, not because of outside pressure, but because socialism destroys wealth. Eventually, the whole nation faces starvation. In fact, socialism in those two countries would have died much earlier had the US not fed their citizens for two decades with massive shipments of corn and wheat to prevent them from starving to death. And for which neither country ever repaid the US. The USSR lasted as long as it did because it stole enormous amounts of wealth from Eastern Europe to keep itself alive. Poor China had no one it could invade and steal from, so its socialism didn’t last as long.
By the way, you can’t blaim Cuba’s failures on the American blockade because Cuba traded with every other nation on the planet, including Canada, and got trillions of rubles in aid from the USSR.
Arguing that socialism will not work until the entire planet is socialist makes it impossible to discuss the merits of socialism and excuses all historical failures of socialism. It requires that people accept the claims of socialism totally on irrational faith. Socialism cannot and has not worked because the lack of prices destroys the ability to calculate and coordinate supply and demand. Effective pricing requires free markets which require private property. The inability to coordinate supply and demand causes waste and destroys wealth.
Comments on this entry are closed.