Nobody spends somebody else's money as carefully as he spends his own. Nobody uses somebody else's resources as carefully as he uses his own. So if you want efficiency and effectiveness, if you want knowledge to be properly utilized, you have to do it through the means of private property.
Interpretation
People are more careful when using their own money than when using someone else's resources.
Milton Friedman emphasizes the importance of private property in resource allocation. He argues that individuals tend to use their own resources more efficiently and responsibly than they would when managing someone else's property. This principle suggests that when individuals have ownership, they take greater care and make smarter decisions about resource utilization, leading to overall better outcomes in knowledge and efficiency.
In practice
In a business meeting discussing budget cuts, this quote can highlight the importance of personal investment.
The economic miracle that has been the United States was not produced by socialized enterprises, by government-unon-industry cartels or by centralized economic planning. It was produced by private enterprises in a profit-and-loss system. And losses were at least as important in weeding out failures, as profits in fostering successes. Let government succor failures, and we shall be headed for stagnation and decline.
Universities exist to transmit knowledge and understanding of ideas and values to students not to provide entertainment for spectators or employment for athletes.
There is no place for government to prohibit consumers from buying products the effect of which will be to harm themselves.
There is one and only one social responsibility of business - to use it resources and engage in activities designed to increase its profits so long as it stays within the rules of the game, which is to say, engages in open and free competition without deception or fraud.
The great danger to the consumer is the monopoly -whether private or governmental. His most effective protection is free competition at home and free trade throughout the world. The consumer is protected from being exploited by one seller by the existence of another seller from whom he can buy and who is eager to sell to him. Alternative sources of supply protect the consumer far more effectively than all the Ralph Naders of the world.
The strongest argument for free enterprise is that it prevents anybody from having too much power. Whether that person is a government official, a trade union official, or a business executive. If forces them to put up or shut up. They either have to deliver the goods, produce something that people are willing to pay for, are willing to buy, or else they have to go into a different business.
Capitalism and market forces are very powerful in producing wealth and innovation. But we need to ensure that these forces act in the common interest.
Money is not an invention of the state. It is not the product of a legislative act.
Economists love to talk about incentives, but the bottom line is that people hate being controlled or manipulated, even when done through voluntary institutions. This is one of the most important tensions in capitalism.
Credit markets were originally created to serve human needs; to provide businesses and individuals with capital to start or expand businesses or fulfill other financial needs.
The more the division of labor and the application of machinery extend, the more does competition extend among the workers, the more do their wages shrink together.
The big bankers of the world, who practise the terrorism of money, are more powerful than kings and field marshals, even more than the Pope of Rome himself. They never dirty their hands. They kill no-one: they limit themselves to applauding the show.
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