No one knows for sure. A consistent rule of law, property rights and low marginal tax rates that provide individuals incentives to reap and keep the rewards of their labor and capital investments all help, but those are all also desirable for other reasons than assuring a prosperous economy, reasons that may even be more important than assuring a prosperous economy. Other factors may include openness to trade and immigration, educational institutions, geography (a port); infrastructure (an airport); and religion or culture.

Editor of FutureOfCapitalism.com and author of "Samuel Adams: A Life", Ira Stoll

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No one knows for sure. A consistent rule of law, property rights and low marginal tax rates that allow people to reap the rewards of their labor and capital investments all help, but those are all also desirable for other reasons than assuring a prosperous economy, reasons that may even be more important than assuring a prosperous economy. Other factors may include openness to trade and immigration, educational institutions, geography (a port); infrastructure (an airport); and religion or culture.

Editor of FutureOfCapitalism.com and author of "Samuel Adams: A Life", Ira Stoll

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As an undergraduate taking economics I learned that raising the minimum wage led to increased unemployment. However, David Card and Alan Krueger have done work showing that the minimum wage increase in the 1990s had no disemployment effects. Bruce Caldwell has a really excellent discussion of this issue on pages 385 top 386 of his book Hayek’s Challenge, which I recommend.

Editor of FutureOfCapitalism.com and author of "Samuel Adams: A Life", Ira Stoll

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It should prosecute and punish crime, including theft and criminal fraud, and it should provide a judicial system for the resolution of civil disputes. It should provide an army that can defend a country from external attacks. It should provide some safety net for the deserving poor.

If it starts expanding its functions much beyond that it tends to start trampling on the property rights and low marginal tax rates [See: What causes an economy to prosper?]. Another important thing is that the government’s role, whatever it is, be established by law enacted by the consent of the governed. This idea of limited and enumerated powers can help prevent the government from trampling the rights of individuals.

Editor of FutureOfCapitalism.com and author of "Samuel Adams: A Life", Ira Stoll

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Unions can play a constructive role in negotiating wages for workers against management and in representing employees as stakeholders in a company. They also can help fight for freedom overseas – the AFL-CIO helped win the Cold War by supporting Solidarity in Poland.

Editor of FutureOfCapitalism.com and author of "Samuel Adams: A Life", Ira Stoll

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One in which marginal tax rates are not so high that they distort incentives, and one that is not so complex that it micromanages behavior or creates inordinate burdens of compliance.

Editor of FutureOfCapitalism.com and author of "Samuel Adams: A Life", Ira Stoll

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Different people have different genes, different parents, different religions, different educations, different life-shaping experiences, so it’s not so surprising to me that they disagree about the truth. It’d be surprising to me if everyone agreed on everything. A lot of people can barely agree with their spouses on what movie to see, let alone agree with random other human beings on “the truth.”

Editor of FutureOfCapitalism.com and author of "Samuel Adams: A Life", Ira Stoll

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