Does Capitalism Exploit Workers?

Release Date
July 19, 2012


Free Markets and Capitalism

Today, many define “exploitation” as taking unfair advantage of others’ vulnerability. Based on this definition, many suspect that capitalism exploits workers. Professor Matt Zwolinski examines whether this is accurate and finds two points against it:
1. Capitalists may not want to pay workers close to the value of what they produce, but they do because competition requires it.
2. Exchanges in free markets are voluntary. This means that even when “exploitative” transactions take place, the institutions of a free market ensure they are mutually beneficial.
Markets may not be perfect, but what’s the alternative? Many believe that to prevent exploitation we need more political regulation and control, but Professor Zwolinski explains the problems with this solution. Bureaucrats, lobbyists, and elected officials are tempted to exploit citizens for the benefit of the politically well connected. Transactions between people and the state aren’t voluntary, so they may not be mutually beneficial either. When politics is involved, one party’s gain usually comes at someone else’s expense.