Structural Limits of Contemporary Capitalism

This paper presents an analytical framework for sixteen structural vulnerabilities that arise, to varying degrees, incontemporary economies characterized predominantly by private ownership and competitive or imperfectlycompetitive markets. The contribution does not rest on the claim that every market, firm, or political institutionnecessarily produces undesirable outcomes. Instead, it formulates mathematical propositions and counterexamplesthat refute universal guarantees of alignment between private objectives and social welfare, independence ofoversight, efficient allocation, access to innovation, and prudent use of material resources. Four families of problemsare distinguished: (I) incentives and capture; (II) market power and information; (III) materials, interoperability,and time horizons; and (IV) institutional capacity and the governance of complex processes. For each of the sixteenmechanisms, Chapter 3 provides an extended demonstration with assumptions, algebraic steps, counterexamples,interpretation, and limitations; Section 3.17 summarizes them in a synoptic table. These results should be read assufficient grounds for refuting particular claims of guaranteed performance, not as estimates of theirfrequency in the real world or as proof that these vulnerabilities are exclusive to capitalism. Version 0.5 alsointroduces a candidate theory of systemic guaranteeability and develops necessary and sufficient conditions, in afinite fully observable setting, for keeping instantaneous social loss below a specified threshold in the presence ofmultiple strategic equilibria and disturbances. It supplies a sufficient certificate for continuous-state dynamicmodels and introduces a reproducible oligopoly laboratory with entry, innovation, transfers, and shocks; itsnumerical findings are conditional on pure-strategy Nash equilibria and synthetic parameters. Finally, a productivecost-savings sharing model is developed, with a necessary-and-sufficient condition reconciling limited netinnovation rewards, innovation incentives, and a maximum social-loss threshold, including parameter disturbances.