Contrary to the views of Marxist activists such as Joti Brar, Capitalism is changing for the good. The ugly, greedy version of this system is giving way to a new, communitarian capitalism argues Paul Collier. 

Over the past 40 years, capitalism has derailed, degenerating into greed. Fortunately, the ideas that drove that derailment are at last being discredited. We are living at the turning of the tide - a moment of intellectual inflection as the mantras of individualism are being displaced.

They are being replaced by a recognition of the value of community. The Tyranny of Merit, (2020), by Michael Sandel, the world’s foremost moral philosopher, introduces the concept of ‘contributive justice’ – linking fairness to the mutuality of obligations. The Upswing (2020), by Robert Putnam, the world’s foremost sociologist, links the rise of communitarian thinking during the first have of the 20th Century to increasing mass prosperity and greater social harmony. He traces the rise of greed to the individualistic cultural revolution of the late 1960s. Reimagining Capitalism in a World on Fire, (2020), by Rebecca Henderson, the top professor at Harvard Business School, is a clarion call for a capitalism based on purposes that contribute to society, not profits at the expense of society. These profoundly important works are complemented by the advances in evolutionary biology pioneered by researchers such as Joe Henrich at Harvard and Nicolas Christakis at Yale.

Accelerated by COVID, aggressive demands for ‘my rights’ are beginning to give way to acceptance of ‘our obligations to each other.’ Ideas take time to filter through into a changed reality, but as Keynes said, ‘the world is ruled by little else’. As the ideas that underpinned greed wither, capitalism will be reformed: we are currently living through Peak Greed. This is what John Kay and I mean in our new and hopeful book Greed is Dead.

We are living at the turning of the tide - a moment of intellectual inflection as the mantras of individualism are being displaced.

We may need a new term to describe a reformed capitalism, but we certainly need the blend of decentralised decision-taking, competition and cooperation that are its best features. The highly centralised decision-taking intrinsic to socialism has been tried in many societies and has invariably failed spectacularly. Its current manifestation in Venezuela has produced the world’s most severe refugee crisis. The alternative extreme, - Silicon Valley’s libertarian dogma of untrammelled individual rights, - is exemplified by response of American society to COVID - queues outside gun-shops.

A socially purpose capitalism is not an oxymoron, it is how business can transform life for the better. In the 19th Century, socially purposive business was exemplified by Titus Salt of Bradford and Joseph Rowntree of York, inventors and businessmen who pioneered philanthropy. In the first decades of the 20th Century, local business was instrumental in founding many or our provincial universities, such as Jesse Boot in Nottingham. We are about to be rescued from COVID by an alliance between a university and a business. Oxford’s success is because it has considerable independence from Whitehall, and even within the University decisions are highly decentralised. Its partner, AstraZeneca has risen to social purpose, committing to provide the vaccine at cost to developing countries.