Speaking of Manners – The Role of Liberty

ShaftesburyMarkets are frequently derided for causing greedy or other loathesome behaviors.  I’m more prone to believe that the problem isn’t with markets per se but with human nature or bad character – unfettered markets, just like other freedoms, allow some of our worst side to play out rather than being the cause of this behavior (in terms of other freedoms, consider how free speech allows ignorant racists to spew hate-filled rants).  Moreover, as Adam Smith and Bernard de Mandeville long ago pointed out, even our less praiseworthy side can cause lots of positive consequences even though our intentions are anything but good.   In other words, private vice can have public benefits. 

But I digress… 

What I’m trying to argue is that we should appreciate markets not merely for their efficient provision of goods and service but also because freedom, including the freedom to engage in commerce on consensual terms, can improve market participants themselves.  As the 3rd Earl of Shaftesbury nicely argued, “All Politeness is owing to Liberty. We polish one another, and rub off our Corners and rough Sides by a sort of amicable Collision.”  And our engagement in the marketplace is just the sort of “amicable collision” that has a polishing effect.  More on how later!

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