Socialism and Capitalism Work Together

In a recent article, I gave free markets much of the credit for the explosion of human well-being that has occurred during the past three or four decades. To some, this sounds like a story of socialism’s failure. And indeed, the kinds of socialism that China tried to implement during the reign of Mao Zedong, and India before 1991, held back economic growth in those country. And more recently, revolutionary socialist experiments like the one in Venezuela haven't turned out well.

But it would be a big mistake to write off socialism. Even as free markets and technological progress have combined to increase the total amount of wealth in the world, a third trend has been extremely important for making sure that that prosperity is widely shared. Governments in many countries have been more assertive about spreading the wealth around -- and the results have been good.