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Comment by stormbrew | Hacker News Reader

The industrial revolution and the beginnings of a global liberal trade order pretty substantially changed the shape of the world's economic system, even if sometimes people call predecessor systems like mercantilism a kind of capitalism.

But if you want to extend the time horizon to 400 years (ie. to the beginning of the end of feudalism) that's still not that long in the grand scheme of things.

That said I don't really know if I buy that we're in that system anymore either; I think history books will probably eventually recognize a shift starting around the collapse of Breton Woods and that we're currently in a long and increasingly painful transitionary period that we're in denial about to something we can't yet describe.

But I Am Not An Economist (nor do I want to be one), so who knows.

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Mercantilism definitely is NOT a kind of capitalism. Adam Smith and other thinkers during the Scottish Enlightenment were specifically arguing against mercantilism. The Cron Laws in England were even successfully repealed by on of Smith's students.

I mean, I agree with you (I just said sometimes people call it that, not that it is that) but I don't think anything you said really contradicts it being a kind of capitalism. After all Lenin and Stalin and Trotsky disagreed literally violently with each other but Soviet Communism is still a label that contains all their efforts and systems.

Right but they were fighting over the direction of a type of political economy that predated all of them. Smith and other original thinkers that framed capitalism did so in opposition to mercantilism. Capitalism was a reaction to. And in many ways criticism of mercantilism.

Did Adam Smith invent capitalism? Did he advocate for capitalism? I still don’t really understand what we mean by capitalism

He is often called the "Father of Capitalism", based on his two surviving works The Theory of Moral Sentiments (1759) and An Inquiry into the Nature and Causes of the Wealth of Nations (1776). He is also often referred to as a founder of modern economics.

In this case what we mean by capitalism loosely is a system of private property, free/open trade, market based pricing mechanisms, economic decisions being made by individual actors, etc.

Right, he burned his other work.

So, private property was certainly there before Smith, as were individual economic decisions. But, there was a lot more price standardization and government planned trade.

So, is capitalism the same as a market economy? I feel like there are endless debates about capitalism and socialism but they are tribalized notions without clear definitions. Eg, are market regulations anticapitalist if they are government imposed or are they procapitalist if they support greater market health?

> So, is capitalism the same as a market economy?

Not exactly, but that is a necessary condition. I think another necessary condition is that prices are set by the market and that the state isn't deeply involved in trade. Obviously there are grey areas, but it seems pretty clear that the export focused state trade policies of mercantilism were not capitalism.

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