Tag: Free markets
-
Myth: Markets debase culture and art
There is no contradiction between the market and art and culture. Market exchange is not the same as artistic experience or cultural enrichment, but it is a helpful vehicle for advancing both.
-
Myth: Markets rest on the principle of the survival of the fittest
In market competition, the losers are not eaten by the winners, as is the case in biological competition. When business firms die, they are replaced by more efficient firms, and the investors, owners, managers, and employees are released to join more efficient firms.
-
Myth: Markets can not meet human needs, such as health, housing, education, and food
If markets do a better job of meeting human needs than other principles, that is, if more people enjoy higher standards of living under markets than under socialism, it seems that the allocation mechanism under markets does a better job of meeting the criterion of need, as well. Food, certainly a more basic need than…
-
Myth: Markets lead to more inequality than non-market processes
Market processes redistribute wealth, giving owners of assets incentives to maximize their value or to shift their assets to those who will. Political processes redistribute property, making property in general less valuable and destroying wealth. Those with the power to transfer property in the name of equality inevitably use it to benefit themselves, and the…
-
Myth: Too much reliance on markets is as silly as too much reliance on socialism: the best is the mixed economy
In the face of an unknown future, such as selecting investments, it’s wise to have a diversified portfolio. But we know that market forces work to grow the economy, and that big-government, interventionist policies don’t. It makes no sense to include these in the policy mix.
-
Myth: Markets lead to disastrous economic cycles, such as the Great Depression
Markets provide mechanisms for adjusting levels of investment and preventing booms and busts in the business cycle. Government policies, however, often distort markets and nurture the conditions that lead to depressions and human suffering.
-
Myth: Markets don’t work in developing countries
What needs explanation is not poverty, which is the natural state of mankind, but wealth. No system better than the free market, based on well defined and legally secure property rights and legal institutions to facilitate exchange, has ever been discovered for generating incentives for wealth creation.
-
Walter Williams on government in a free society
Economist Walter E. Williams spoke on the legitimate role of government in a free society, touching on the role of government as defined in the Constitution, the benefits of capitalism and private property, and the recent attacks on individual freedom and limited government.
-
Myth: The more complex a social order is, the less it can rely on markets and the more it needs government direction
As society becomes more complex, reliance on voluntary market exchange becomes more — not less — important. A complex social order requires the coordination of more information than any mind or group of minds could master.
-
Kansas state spending is not, itself, a good
In the debate over reducing and eventually eliminating the income tax in Kansas, those who oppose income tax reduction say it will simply shift the burden of taxation to others, in the form of sales and property taxes. This is true only if we decide to keep spending at the same rate. We could cut…
-
Myth: Markets don’t work (or are inefficient) when there are negative or positive externalities
Negative externalities such as air and water pollution are not a sign of market failure, but of government’s failure to define and defend the property rights on which markets rest.
-
Myth: Markets cannot possibly produce public (collective) goods
The public goods justification for the state is one of the most commonly misapplied of economic arguments. But many goods that are allegedly impossible to provide through markets have been, or are at present, provided through market mechanisms — from lighthouses to education to policing to transportation, which suggests that the common invocation of alleged…