Over at the Stanford Encyclopedia of Philosophy, Lisa Herzog has written a very nice entry on “markets” that will likely be of interest to readers of this blog. In particular, section three provides a very helpful overview of some of the most common and influential arguments for and against markets. Rawls, Hayek, Buchanan, McCloskey, Tomasi, Satz – it’s all in there.

One thing I found particularly useful was Herzog’s claim that it is often more useful to talk about the vices and virtues of particular markets than of “markets” as a general abstract category.

When comparing markets to other institutional solutions, the comparison has to take place at the same level of abstraction. Otherwise one compares apples to oranges, e.g. when a very imperfect market with great asymmetries of power is contrasted with an idealized public bureaucracy, or when a market in which all individuals are fully rational is contrasted with corrupt public institutions. It makes more sense to compare a reasonably well-functioning market with a reasonably well-functioning bureaucracy, and it is likely that one will have to be more specific about the kind of market and the kind of bureaucracy in question in order to define the standards of “well-functioning” one can reasonably expect.

The whole thing is worth reading. And if your summer reading list needs beefing up, be sure not to miss the bibliography!