Joseph Vogt on the Demystification of the Market


Despite all the crises that have shaken the world economy and financial system, the idea still appears to be widespread that the market is not only a place of rational adjustment but also of self-stabilizing forces. Large parts of economics and finance are based on this assumption. In his essay “Das Gespenst des Kapitals” (The Spectre of Capital), Joseph Vogl analyses our knowledge of the economy and asks, how in the face of the crises of the market can we speak of the economic world as a sensible and rational system?

The capitalist economic system is based on the idea that the market economy is self-regulative and develops self-stabilizing forces. According to the theory, supply and demand are adjusted to one another by the price and goods are efficiently and justly distributed. The state should intervene only in the case of so-called market failure, as for example with cultural institutions. Apart from these exceptions, the market economy is regarded as the most efficient form of the organization of exchange relations. Crises are explained not by causes within the system itself, but by market-external factors such as mistaken economic policy.


“Political Economy of Bubbles,” Edward Fullbrook

“Manifesto of the appalled economists,” 2010

FREE INTERNET BOOK: “THE SYSTEMIC CRISIS OF THE EURO – TRUE CAUSES AND EFFECTIVE THERAPIES,” by Heiner Flassbeck and Costas Lapavitsas, Rosa Luxemburg Foundation, 44 pp, May 2013

The European Economic and Monetary Union (EMU) is in deep crisis, and an increasing number of observers question the ability of EMU to survive this crisis. What has gone wrong? Are the diagnoses commonly offered valid? Why do the medicines that have been prescribed not work? Could it really be possible that European politics at the highest level fails to understand the cause of the crisis and to address it with a consistent plan?
In order to find persuasive answers to these questions it is necessary to go back to the origins of monetary union and to identify the constructional defects that have burdened its existence from the very beginning up to the point of make or break that it reached after the big financial crisis and the great recession of 2008 and 2009

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