Democratic Capitalism and Philanthropy in a Global Economy

Abstract

When the market creates social problems, non-market solutions may alter or equalize them. The response to social problems in many countries has been through legislative, regulatory or other government action. In many countries in the developing world, state solutions are crippled by poor funding resources for social issues, lack of technical ability to achieve adequate solutions, and in some cases, lack of government legitimacy. Given this, the ideal solutions for social problems must come from non-market and non-state sources. We argue that philanthropy, a social innovation born in the United States, has great potential to work in other countries.