In defense of profit-seeking

Jonathan Lingenfelter and Walter E. Block

Journal of Economic and Administrative Sciences, 2014, vol. 30, issue 1, 53-59

Abstract: Purpose - – Profits have a bad press. They are associated in the public mind with greed, avarice, self-seeking. The purpose of this paper is to make the case in behalf of profit-seeking, so as to right the balance of publications on this topic. Design/methodology/approach - – The authors undertake an economic analysis of the phenomenon of profit-seeking. The paper explores how profits lead to resource allocation, wealth creation, the promotion of human welfare and well-being. Findings - – The paper finds that the system of profit and loss, part and parcel of economic freedom and laissez faire capitalism, does indeed promote wealth. It is the last best chance to fight poverty. Contrary to the views of the economically illiterate, it does not cause inflation or the business cycle nor any other economic malady. Originality/value - – We cannot give ourselves good marks as to originality. Adam Smith, Ludwig von Mises and Murray Rothbard beat us to the punch as to the benefits of the profit and loss private property rights system. However, as Friedrich Hayek said each generation must fight these battles in its own context. So, the authors claim value for this paper, since it confronts more modern criticisms, and addresses more recent contexts.

Keywords: Entrepreneur; Free market economy; Profit and loss; Profit-seeking (search for similar items in EconPapers)
Date: 2014
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Persistent link: https://EconPapers.repec.org/RePEc:eme:jeaspp:v:30:y:2014:i:1:p:53-59

DOI: 10.1108/JEAS-11-2013-0042

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