Free markets and morality

Posted by Todd Kuipers
October 31, 2008

It’s taken me far too long to read through them but the Templeton Foundation’s conversation entitled Does the free market corrode moral character? gathered together a variety of philosophers of different stripes to comment.  Most of the commentators seemed to support that idea that free markets are at least morality neutral or if not morally positive.  The one response that I noticed, by Michael Walzer (PDF), compared the market to a free democracy and followed the logic through and stated that we need a market constitution to keep things in-check and reasonably well balanced.

My most basic response would be that any country or jurisdiction that does 2 clear things already have a de facto market constitution in place already.  These are (thanks to de Soto):

  1. Clear Property Rights free from coercion and threat of confiscation;
  2. Rule of Law regardless of class, status or other category.

Essentially Britain and the US (and their derivative nations) have a clear constitution that guarantees equality and most have (fairly) solid property rights provisions.  If this is isn’t a clear constitution for markets, I’m not sure what is - what’s legally yours is yours and you have the right to equal application of the law, most significantly (relative to markets) where it affects your property rights.

I would suggest that if there’s a breakdown in either of these parameters it has much more to do with deficiencies in the associated political system than it does to do with the market.



Behaviour, Economics, Freedom, Politics

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