Introduction

It is a truism that economic activity is central to human life and no model of perfect society can ever ignore the way economy is organized. Exploration of utilitarianism and its criticism helps in reflecting on the foundational thinking in economics. However, in dealing with the economic ideas in development economics at the macro level one has to confront with the issues involved in systems design. All leading social scientists, activists and political thinkers have had something to say on economic systems. In literature one can identify a large number of models of economic organization which can broadly be divided into three: capitalism, socialism, and mixed economy. This lecture is devoted to study of capitalism, socialism and mixed economy. There is a huge debate on desirability and undesirability of various varieties of each of these economic systems and there is no easy solution. In this lecture, an attempt will be made to link them to basic issues in human happiness. This will be followed by discussion of value based economic system – Buddhist economy – in the next lecture.