Behind every great fortune is an equally great crime

Jay B. Barney, David J Schmidtz

Research output: Chapter in Book/Report/Conference proceedingChapter

Abstract

This chapter examines the accuracy of the quote “behind every great fortune is an equally great crime,” attributed to Balzac. In our times great individual fortunes are generally generated via the instrument of the business firm. The question then becomes when are firm profits a crime? Firm profits are, in general, explained by one or more of three factors: luck, efficiency, and collusion. While it is difficult to regard luck as a crime, luck does not reflect merit. Profits due to efficiency seem like the least problematic case, and collusion seems the clearest case of when fortune coincides with crime. A variety of cases lie, at least in a dynamic sense, at the intersection of the three conditions. Unfortunately, history suggests that big business and big government can collude to keep profits flowing to the former and contributions flowing to the latter. While luck and efficiency may help initiate wealth, the system tolerates connivance, making Balzac’s statement more plausible than it ought to be.

Original languageEnglish (US)
Title of host publicationCapitalism beyond Mutuality?
Subtitle of host publicationPerspectives Integrating Philosophy and Social Science
PublisherOxford University Press
Pages191-206
Number of pages16
ISBN (Electronic)9780198825067
DOIs
StatePublished - Jan 1 2018
Externally publishedYes

Keywords

  • Collusion, monopoly
  • Crime
  • Crony capitalism
  • Efficiency
  • Inheritance
  • Luck
  • Political power
  • Sources of economic profit
  • Wealth accumulation

ASJC Scopus subject areas

  • Economics, Econometrics and Finance(all)
  • Business, Management and Accounting(all)
  • Social Sciences(all)

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  • Cite this

    Barney, J. B., & Schmidtz, D. J. (2018). Behind every great fortune is an equally great crime. In Capitalism beyond Mutuality?: Perspectives Integrating Philosophy and Social Science (pp. 191-206). Oxford University Press. https://doi.org/10.1093/oso/9780198825067.003.0010