Drawing on modern economic thinking and, especially, on Hodgson’s “impurity principle”, we propose in this paper that it is possible to analyze capitalist-democratic societies by breaking them down into five evolving social subsystems: the market, the State, the realm of individuals, civil society and the natural environment. We explore the possibility of conceiving these structurally dissimilar subsystems as co-evolving at the very basis of capitalist change. Looking at capitalist-democratic systems through this lens may allow us to overcome some limitations of earlier theoretical approaches, and it might bring a clearer focus to our understanding of important imperfections of these societies. We suggest that phenomena such as unemployment and social frictions as a consequence of fast economic change, or environmental damages, could be interpreted as global properties emerging from the uneven development of the previously mentioned social subsystems.
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