Gene Epstein in Barron’s reviews Murphy’s Politically Incorrect Guide to Capitalism:
The Politically Incorrect Guide to Capitalism (Regnery, 2007), by economist Robert P. Murphy, contains more economic wisdom in its fewer-than-200 pages than the average principles textbook several times its length. In clear and often irreverent prose, Murphy makes a compelling case for the unfettered free market, or what his intellectual antagonists would call “free-market fundamentalism.” The book is one of several “politically incorrect guides” (”P.I.G.”) released by the same publisher.
Occasionally I wish Murphy weren’t so irreverent. He begins the book with a delightful five-question quiz under the headline, “Are You a Capitalist Pig? Take the Quiz and Find Out!” You might be a capitalist pig — instead of “bureaucratic swine” — if, in answer to the question “How much should a worker be paid?” you answered, “c) Just enough to keep him from quitting,” rather than “a) On a sliding scale depending on how important his work is to society” or “b) Enough to support his family.”
Later discussion in the book makes it fairly clear why answers like “c” make for more humane outcomes. (If employers practiced “a” or “b,” the worker might have no job at all.) But the uninitiated could have benefited from more pointed explanations. I hope Murphy provides these explanations in a subsequent edition, along with an expanded list of multiple-choice questions.
Murphy would probably be the first to admit to exceptions to his rule that workers be paid only enough to prevent them from quitting. If dollars paid above that level yield even more dollars of enhanced productivity, it will be in the capitalist’s interest to pay the premium.
