Social market economics revisited

Abstract

PurposeThe socioeconomic as well as the political world has undergone significant changes, challenging the meaning and validity of economic and political paradigms. This treatise highlights that Eucken's paradigm of a “social market economy,” with its structural and regulating principles, needs to be modified to account for changing strategic factors.Design/methodology/approachNo economic theories, however relevant in the past, hold true for all time. This is verified by the dynamics of change as indicated by Hegelian dialectics, functionalism and structuralism, as well as by quantum theory.FindingsNational economies have become linked in the widening web of the global economy, exemplified, for example, by the European Union, the Euro Bloc, NAFTA, WTO, as well as by other trading arrangements. Enterprises have developed a global orientation, internationalizing their products and services, encouraging labor and capital to move instantaneously among industrialized countries, affecting social, fiscal, and monetary policies. Furthermore, these developments have increased awareness, on a global scale, about human rights and dignity, a healthy environment, changing demographics, and of limited natural resources.Practical implicationsThere is increasing awareness of contemporary challenges facing mankind and the environment, as well as the merging of national economies within a global framework. These challenges with their demands for modifications in socioeconomic as well as political policies may transform the paradigm of a “social market economy” into an “ecological social market economy”.Originality/valueTraditional economic theories usually consider capital and labor as the primary factors of production. Nature (all natural resources), on the other hand, tends to be neglected as an economic good and as an essential third factor of production. A political economy is suggested which assigns equal importance to man and nature, the costs of which have to be fully accounted for, including those for the preservation and regeneration of natural resources.

The journal Moneda y Crédito as a vehicle spreading the social market economy in Spain (1943-1966)

“…Also, at the end of the 1980s, a group of economists led by Willgerodt (1989a, 1989b) worked on the collection and publication of works by authors of the Freiburg School, translated from the German into English, most of them published in Ordo. In the last decade, the main SME postulates have been studied by authors such as, Karsten (2005), Ebner (2006), Goldschmidt and Wohlgemuth (2008), Keitel (2009), Ptak (2009), Albach (2010), Ioannidis (2011), Muresan (2014 and Birch (2017). More recently, some works reflect the interest in publicising the dissemination of these ideas in Spain and their impact on the economic policy measures taken at the end of the Civil War (Ban, 2012;Sánchez-Lissen and Sanz-Díaz, 2015;Pazos et al, 2015;Martín, 2016).…”

How Effective is European Public Support Granted to Social Enterprises for Employment in the Czech Republic?

“…These enterprises act inside and outside the market as socially oriented business ventures (Helmsing 2015), with social objectives. The social market economy redefines the public sector's role (Nicholls 2011, 80) in serving social needs more effectively and efficiently through social innovations (Karsten 2005;Urban 2015). Social entrepreneurs are more aware of people's needs than is the public sector, and they fill the gaps in the provision of goods by both the public and the private sectors (Borzaga, Fazzi, and Galera 2016).…”

El Plan de Estabilización español de 1959: Juan Sardá Dexeus y la economía social de mercado

“…En este sentido destaca el trabajo deKarsten (2005), que incluye el componente ecológico, denominándola economía social de mercado ecológica, así como el deStuart (2006), que aboga por una política de libre mercado como la ESM para hacer frente al elevado desempleo en las economías actuales.4 La deuda pública creció a una media anual del 230% en 12 años(1932)(1933)(1934)(1935)(1936)(1937)(1938)(1939)(1940)(1941)(1942)(1943)(1944), y la circulación fiduciaria se multiplicó por 11 entre 1932 y 1945.5 Erhard fue director de la administración económica en la zona de ocupación británica y americana, y al crearse la RFA continuó como Ministro Federal de Economía y posteriormente como canciller durante 3 años(1963)(1964)(1965)(1966). A partir de este momento la aplicación de la ESM se diluyó con la aplicación de políticas keynesianas, y empezó a perderse su esencia(Wünsche, 1994, p. 27).…”