Without government, there is potential for other groups in society to form in order to coerce actions or transfer resources. Coercion does not need to be purposeful. When the voluntary trade of two people has an impact on a third, unrelated, person's choice we can still view this trade as coercive to some degree.
In a case with private coercion, the government can have a role in improving individual freedom and there by happiness. People that fear the idea of a free market do so because they equate the market with a situation where there are groups that will try to control and manipulate peoples actions.
In the same way, people who believe in greater market freedom often do so based on the idea that the government is a type of organisation that is coercing people.
When we view the issue through this frame,it becomes evident that it is not the market or the lack of it that is the underlying issue — but the concept of coercion and power. The conflict between those on the left and those on the right of the political spectrum often boilsdown to differing beliefs regarding the ability and intention of government and private groups to manipulate people's choices.
Take for example the recent credit crisis. Some analysts believe that a lack of regulation was at fault for the collapse of credit markets, some believe that too much regulation was at fault, and somebelieve that there were no regulation issues and we were just unlucky. In the first two cases, there was somesetting which distorted or controlled individuals' choices, implying that whatoccurred wasn't the best choice. In the last case there wasn't any issue,society was just unfortunate.
What this indicates is that, even following something as monumental as the credit crisis, it is unclear whether it was private or public coercion that made matters worse or if matters actuallycould have been any better than they appeared to be. But it does tell us that any regulation should be based on the idea of avoiding coercion either from the private or the public sector.
For example, during the current crisisthere were suggestions to limits to bonuses in the financial sector.
The free market is an economic system based on supply and demand with little or no government control. It is a summary description of all voluntary exchanges that take place in a given economic environment.
Free markets are characterized by a spontaneous and decentralized order of arrangements through which individuals make economic decisions. Based on its political and legal rules, a country's free market economy may range between very large or entirely illegal.
However, a more inclusive definition should include any voluntary economic activity so long as it is not controlled by coercive central authorities. Using this description, laissez-faire capitalism and voluntary socialism are each examples of a free market, even though the latter includes common ownership of the means of production.
The critical feature is the absence of coercive impositions or restrictions regarding economic activity.
No modern country operates with completely uninhibited free markets. That said, the most free markets tend to coincide with countries that value private property, capitalism, and individual rights.
This makes sense since political systems that shy away from regulations or subsidies for individual behavior necessarily interfere less with voluntary economic transactions.
Additionally, free markets are more likely to grow and thrive in a system where property rights are well protected and capitalists have an incentive to pursue profits. In free markets, a financial market can develop to facilitate financing needs for those who cannot or do not want to self-finance. For example, some individuals or businesses specialize in acquiring savings by consistently not consuming all of their present wealth.
Others specialize in deploying savings in pursuit of entrepreneurial activity, such as starting or expanding a business. These actors can benefit from trading financial securities such as stocks and bonds. For example, savers can purchase bonds and trade their present savings to entrepreneurs for the promise of future savings plus remuneration, or interest.
With stocks, savings are traded for an ownership claim on future earnings. There are no modern examples of purely free financial markets. All constraints on the free market use implicit or explicit threats of force. Common examples include: prohibition of specific exchanges, taxation, regulations, mandates on specific terms within an exchange, licensing requirements, fixed exchange rates , competition from publicly provided services, price controls , and quotas on production, purchases of goods, or employee hiring practices.
Common justifications for politically imposed constraints on free markets include consumer safety, fairness between various advantaged or disadvantaged groups in society, and the provision of public goods.
Whatever the outward justification, business firms and other interest groups within society often lobby to shape these constraints in their own favor in a phenomenon known as rent-seeking. When free market behavior is regulated, the scope of the free market is curtailed but usually not eliminated entirely, and voluntary exchanges may still take place within the framework of government regulations.
Some exchanges may also take place in violation of government rules and regulations on illegal markets which may be in some ways considered an underground version of the free market.
However, market exchange is still heavily constrained because, on an illegal market, competition often takes the form of violent conflict between rival groups of producers or consumers as opposed to free market competition or rent-seeking competition via the political system.
As a result, in an illegal market, competitive advantage tends to flow to those who have a relative advantage at violence, so monopolistic or oligopolistic behavior is likely and barriers to entry are high as weaker players are driven out of the market. In order to study the effects of free markets on the economy, economists have devised several well known indexes of economic freedom.
The ability to buy and sell is quite open and concrete. There are strict legal rules on it. Its openly acknowledged what is and is not allowed. In that sense, the legal right to buy and sell whatever has not been deemed illegal is a concrete a right - one established in law, open, and difficult to change.
The OP seems to be addressing the second question, not the first. I consider Social Darwinism to be oppressive in a social and perhaps even political sense. Note that the legal and policing systems protecting your property rights only exist because of taxation ie. I think your answer depends on how you interpret the question. But it seems that most governments tend to fall along a diagonal that goes from lower left to upper right.
If someone interpreted the OP question to pertain to that diagonal, then moving to the right would imply fewer personal liberties, and if personal liberties are more important to that person that economic liberties, then I see that increasing economic liberty could be seen by that person as decreasing personal liberty. And I agree that one must differentiate between freedom and comfort when answering this question.
Freedom is not about guaranteeing success or hapiness or even health. In that sense, freedom can be a scary prospect. What is the definition of a free market? I am assuming that the definition of a freer market is one less trammeled by government regulation or other goon squad activity. It is ultimately freedom to feel joy, suffering, whatever you can accomplish without infringing on the freedoms of others.
Think otherwise. I go to a community college, tutor math near the edge of the local ghetto for laughable pay, and live mainly on ramen noodles.
I get to realize my potential on my own, or fail on my own. Again, this is another bad question, IMO. Its all in your interperatation. Only an anarchist would think that. But its one with a minimum of government of interference, allowed to opperate, within the limites society places on it i. Its a fine balance. Businesses are in business for one thing only…to make a profit.
This is pretty much how I interpereted it as well. Freedom is the ability to try, not the guarentee that you will succeed. Monopolies are notoriously hard to achieve, and even harder to maintain without government backing. This political compass statement is damn near a tautology. I actually believe the reverse, the freer the people, the freer the market.
I clicked agree, but primarily because I felt it was a badly phrased question, and when I come upon those I simply click on the answer that reflects my political leanings.
If I may ask a question of those ticking Agree : How would you describe a most free market? Surely, if a least free market is one which is totally regulated by government, most free is one with no government involvement: ie. This is a difficult one to answer and subject to some basic interpretation.
Originally, I chose agree, reasoning that people who live in free markets are in general more free than people who live in managed economies. After more reflection, I choose disagree for the following reasons.
Want to sell poison and call it medicine? No problem. Want to sell meat without inspection? Want to hire child labor? Want to pollute the water? None of these were any obstacle to business in that era.
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