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  1. #1
    Senior Member Survive & Stay Free's Avatar
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    Default Does the market have limits?

    If this belongs in philosophy and spirituality more than here then please move it, thanks.

    The question I would like to pose with this thread is whether or not there is a limit to the market and market forces as regulating and normative social levers? If there is is it a natural limit or is it one which has to be imposed? If a limit needs to be set then how?

    Constitutionalism has been used before now to set acceptable limits upon government, would something like it be required to establish the limits of the marketplace if you think a limit needs to be set?

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    Glowy Goopy Goodness The_Liquid_Laser's Avatar
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    Yes, the market has limits. Especially an unregulated market if that is what you are referring to. For example in an unregulated market monopolies will arise. However a competitive environment is what is best for consumers. Monopolies are anti-competitive by their nature.
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    ^He pronks, too! Magic Poriferan's Avatar
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    There are some things in which so-called market forces produce inferior result to alternative forces. However, unregulated, market forces will creep into anything and everything. Therefore to get the best possible results there are times when pro-active steps must be taken to limit/regulate markets. The government, one hopefully representational in nature, is the most typical servant of this role.

    Other ideas may be the involvement of unions, syndicates, certain implimentation of cartels, or replacement of corporations with cooperatives. I'm a big fan of cooperatives, but I do not believe for a second that there is a possible solution without the government's oversight, so I'm sticking with the classic.
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    Senior Member Survive & Stay Free's Avatar
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    Quote Originally Posted by The_Liquid_Laser View Post
    Yes, the market has limits. Especially an unregulated market if that is what you are referring to. For example in an unregulated market monopolies will arise. However a competitive environment is what is best for consumers. Monopolies are anti-competitive by their nature.
    But are monopolies inevitable? Can they perform a regulative function better than a government? Dont monopolies have only limited scope for tyrannising whereas governments have unlimited scope?

    Just playing devils advocate because I think that markets as a source of social order and allocative efficiency are pretty limited, to be honest I think they met their limits long ago and pushing the limit has been the source every major upheavel and crisis since.

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    Senior Member Survive & Stay Free's Avatar
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    Quote Originally Posted by Magic Poriferan View Post
    There are some things in which so-called market forces produce inferior result to alternative forces. However, unregulated, market forces will creep into anything and everything. Therefore to get the best possible results there are times when pro-active steps must be taken to limit/regulate markets. The government, one hopefully representational in nature, is the most typical servant of this role.

    Other ideas may be the involvement of unions, syndicates, certain implimentation of cartels, or replacement of corporations with cooperatives. I'm a big fan of cooperatives, but I do not believe for a second that there is a possible solution without the government's oversight, so I'm sticking with the classic.
    To be honest I think that corporations where once the socially conscientious economic panacea so substitutions of this or that institution with this or that special label to perform the same function could be just as problematic.

    Its part of the reason why I gave up on a lot of the syndicalism vs. councils vs. commissariat (spelling) committees vs. democratic centralism vs. ParEcon vs. Mutual associations vs. co-operatives vs. etc. debates from my teens.

    I tend to think that economies are fundamentally mixed and prosperity corresponds to accumulation and then circulation of capital, pretty much along Keynesian lines, which requires something resembling a welfare or warfare state. Which has a lot of externalities and problems all of its own.

    The thing though is that market forces, which exist in some shape and always reassert themselves, sometimes inappropriately, are being pushed beyond their limits and considered a sort of panacea by themselves which I think is really erroneous.

  6. #6
    Dreaming the life onemoretime's Avatar
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    The market has limits, because profit depends on stupidity (or to be less judgmental, "information disparities.") Eventually, that stupidity is going to catch up with itself and cause all sorts of problems (see Dutch tulip crisis, current economic catastrophe.)

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    Glowy Goopy Goodness The_Liquid_Laser's Avatar
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    Quote Originally Posted by Lark View Post
    But are monopolies inevitable?
    Yes. It somewhat depends on the industry, but in most industries monopolies are inevitable without any type of government involvement.

    Can they perform a regulative function better than a government?
    No. Monopolies overcharge and they prohibit innovation. The advantage of capitalism is supposed to be a great product at a reasonable price. Monopolies encourage the opposite.

    Dont monopolies have only limited scope for tyrannising whereas governments have unlimited scope?
    Monopolies are limited by the type of product they are offering. An entertainment monopoly doesn't matter, because entertainment is not a necessity. A monopoly on electricity or healthcare on the other hand would basically make any business all powerful. They could charge whatever they want and make their own standards. People would have to do whatever the company said, because they control a vital resource.

    The importance of most products is somewhere in between. A monopoly on say, computer operating systems, is more important than an entertainment monopoly, but it's not nearly as crippling as a monopoly on electricity or some other necessity.

    Just playing devils advocate because I think that markets as a source of social order and allocative efficiency are pretty limited, to be honest I think they met their limits long ago and pushing the limit has been the source every major upheavel and crisis since.
    I don't really see markets as limited. I think they are pretty amazing for the most part. But they can have some nasty side effects if they go unregulated. It may be that my viewpoint is different since in the US markets are given a bit more power compared to many industrialized countries.
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  8. #8
    ^He pronks, too! Magic Poriferan's Avatar
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    Quote Originally Posted by Lark View Post
    To be honest I think that corporations where once the socially conscientious economic panacea so substitutions of this or that institution with this or that special label to perform the same function could be just as problematic.

    Its part of the reason why I gave up on a lot of the syndicalism vs. councils vs. commissariat (spelling) committees vs. democratic centralism vs. ParEcon vs. Mutual associations vs. co-operatives vs. etc. debates from my teens.
    Everything has flaws, but I think there are better options and worse options. I hate corporations, I really do. There are very few cases where there's something that a worker cooperative, a consumer cooperative, or direct government control, could not do a better job than a corporation. Maybe two of the three would be terrible for the job, but one is usually better than a corporation. A sort of technical exception could be made for things that function like corporations but are on a very tight leash held by the government.

    Quote Originally Posted by Lark View Post
    I tend to think that economies are fundamentally mixed and prosperity corresponds to accumulation and then circulation of capital, pretty much along Keynesian lines, which requires something resembling a welfare or warfare state. Which has a lot of externalities and problems all of its own.
    Well, yes, things need to be mixed. I'm not sure if that mixture needs corporations, though.

    What is the goal, anyway? I always thought it was a higher quality of living. That through use of resources and development of technology we make society a better place to live, and to do so as equitably as possible. Whatever works best to that end is what we want. I'm skeptical about Keynes on some things, but I do assume to achieve this goal, capital needs to be moving around a lot.


    I've been curious about something lately. I have a friend who's really into defense spending, to the point that he almost favors the warstate model even if there's no war we need to have (sounds kind of 1984 if you ask me). What I asked him two days ago was "can you think of something that would economically operate like the warfare state that doesn't actually involve department and companies designed for war?". In theory, all it takes is heavy and complex goods production, and a lot of it. Does that have to be geared toward war or defense? Isn't there something more socially useful that could have the same needs? It's something worth looking into.

    Quote Originally Posted by Lark View Post
    The thing though is that market forces, which exist in some shape and always reassert themselves, sometimes inappropriately, are being pushed beyond their limits and considered a sort of panacea by themselves which I think is really erroneous.
    Well, they exist as patterns of belief and behavior, and that's all they exist as. Letting market forces do everything is actually a synonym for doing nothing. They are more or less present to the degree that deliberate, purposeful decisions are made about influencing or controling the economy.
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  9. #9
    nee andante bechimo's Avatar
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    A completely free market assumes that people have sufficient self-preservation instincts not to blow themselves up through greed or at minimum, be relatively informed buyers. Wrong.

    But I struggle and have disdain for the concept of nanny governments. Maybe it's best to allow market forces to define who survives.

  10. #10
    ^He pronks, too! Magic Poriferan's Avatar
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    Quote Originally Posted by Metaphor View Post
    A completely free market assumes that people have sufficient self-preservation instincts not to blow themselves up through greed or at minimum, be relatively informed buyers. Wrong.
    No, it quite clearly requires both perfect rationality and perfect awareness. One cannot settle for less.

    Quote Originally Posted by Metaphor View Post
    But I struggle and have disdain for the concept of nanny governments. Maybe it's best to allow market forces to define who survives.
    Why? And what constitutes a nanny government in your mind?

    Some sort of social darwinism based on economic exchanges absolutely positively doesn't sound like it would be best.
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