<P> Theoretically, when an economy is fully competitive (i.e. has no market imperfections like externalities, monopolies, information or power imbalances etc), the profit motive ensures that resources are being allocated efficiently . For instance, Austrian economist Henry Hazlitt explains, "If there is no profit in making an article, it is a sign that the labor and capital devoted to its production are misdirected: the value of the resources that must be used up in making the article is greater than the value of the article itself ." In other words, profits let companies know whether an item is worth producing . Theoretically in free and competitive markets, if an individual firm maximizes profits, it ensures that resources are not wasted . However, the market itself, should minimize profits as it is the cost to the value chain . Competition is the key tool by which markets overcome the individual firm's profit maximization incentive . The profit motive is a good of value to the economy . It is needed to provide incentive to generate efficiency and innovation . However over-remuneration of the profit motive creates profit inefficiency . </P> <P> The majority of criticisms against the profit motive center on the idea that profits should not supersede the needs of people . Michael Moore's film Sicko, for example, attacks the healthcare industry for its alleged emphasis on profits at the expense of patients . Moore explains: </P> <Dl> <Dd> We should have no talk of profit when it comes to helping people who are sick . The profit motive should be nowhere involved in this . And you know what? It's not fair to the insurance companies either because they have a fiduciary responsibility to make as much money as they can for their shareholders . Well, the way they make more money is to deny claims or to kick people off the rolls or to not even let people on the rolls because they have a pre-existing condition . You know, all of that is wrong . </Dd> </Dl> <Dd> We should have no talk of profit when it comes to helping people who are sick . The profit motive should be nowhere involved in this . And you know what? It's not fair to the insurance companies either because they have a fiduciary responsibility to make as much money as they can for their shareholders . Well, the way they make more money is to deny claims or to kick people off the rolls or to not even let people on the rolls because they have a pre-existing condition . You know, all of that is wrong . </Dd>

How is the profit motive the driving force of the american economy