This essay develops four points. First, two basic reasons led to John Paul II’s advocacy of the market economy in Centesimus Annus ‐ the creativity of labour, and the failures of socialism and excessive state intervention to ensure basic welfare, especially in underdeveloped countries. Second, the implications of this new‐found support for the market system, its institutions and their working require some clarification. Third, essential qualifications remain: private and social morality must guide economic freedom, just legal framework is required, and government surveillance must remain especially of distribution. Fourth, today’s market system, now operating globally, has given rise to new needs for ensuring adequate employment with security of tenure. Firms and public agencies should see themselves as “communities of persons” concerned with the welfare of their employees. Finally, this discussion of the market economy takes issue with those who confuse a morally directed version with one reflecting automatic forces, and with others who think a desirable economic system and policy and the premises of economic science cannot be influenced by Christian thought.