Economy and Society by Parsons Talcott Smelser Neil J

Author:Parsons, Talcott,Smelser, Neil J.
Language: eng
Format: epub
Publisher: Taylor & Francis (CAM)

On the basis of almost every one of these components in the market for productivity, the tendency is for the structure of the market to be skewed markedly further from the criteria of perfection than in the case of the capital market. In the first place, the goal-exchange deals with much more specific facilities than capital funds; that is, men and machines are much more immediately applicable than generalized purchasing power. This is an application of the proposition that facilities must be made specific through several stages of decreasing generality before they can be made effective as facilities in production, power, pattern-maintenance, etc.88 The functional case for centralized control of productive capacity (which is of course almost always latent) therefore approaches more closely the functional case for the monopolization of the force and violence by the state. Hence the agencies which encourage enterprise (in our sense) and control productivity are almost always agencies of the Government, which are both more centralized and more non-economic than the banking system.

A second source of imperfection of the market for productivity is found in the A-component, particularly in the predominance of political goals as criteria for the endorsement of the importance of any particular economic sector. The basis for the protection of many infant industries (e.g., synthetics), for certain tariff protection (e.g., the “defence” rationale for the protection against Swiss watches) and for certain government support through contracts (e.g., intercontinental ballistics) is not at all economic; indeed to establish economic units in connection with system-goals often means a less efficient allocation of productivity from the standpoint of the economy. Defence, welfare, and other political considerations consistently outweigh the standards of economic rationality. That the degree of imperfection is greater than that of the capital funds market is illustrated by the following example. In the decision to protect a certain infant industry for purposes of defence, only if the economic costs are absolutely prohibitive is the economic basis taken as the primary determining factor in the support of this by tariffs. But once the tariff is enacted, and a certain degree of credit standing has hence been conferred upon the industry, the advance of capital funds to this industry depends upon a great many more considerations than the importance of the industry for the defence of the nation. Most of these considerations, furthermore, deal with the economic standards by which the funds are to be applied.

The sources of variation or imperfection in the I- and L-components of this market also imply a degree of remove from short-term economic considerations. Imperfections in the I-component deal with the degree of commitment of the relevant economic units to the goals of the political system. Manifestations of a low degree of such commitment would be instances of deliberate corruption of government funds, generalized lack of cooperation in the supply of system-goal facilities, etc. The existence of such imperfection provides a second basis for the centralization of control over productive capacity: such imperfections must be readily controllable. Variations in the L-component deal, finally, with the level of valuation of productivity as an appropriate power base.

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