Debra Satz on banning markets

Debra Satz's book, Why Some Things Should Not be for Sale: The Moral Limits of Markets is a kind of book I rarely encounter. It endorses a thesis I find fundamentally nasty, i.e., "an invasion of contract by status, the subordination of market price to social justice, the replacement of the free bargain by the declaration of rights." But it was also enjoyable to read. The author presents a clear case (mostly), genuinely understands the strength of her opponent's points (usually), and holds back from drawing overly sweeping conclusions (typically).

Satz begins her book by outlining reasons why markets are good. She notes two primary virtues of markets - markets are efficient in their production and allocation of goods and services, and markets enable freedom for people in allowing them to choose what to buy and sell. She immediately follows this with the textbook accounts of market failure - imperfect information, externalities, etc. Gratifyingly, she also notes that market failure does not by itself justify government intervention: "Of course, even if markets generate inefficiencies due to externalities, the alternatives might be worse. Perhaps some market inefficiency is preferable to a lot of government regulation, with its slow, clumsy, and lumbering bureaucracy."

Her fundamental thesis actually isn't very controversial. She argues that limits on markets, or lack thereof, can't be justified in terms of economic efficiency or inefficiency. This statement, by itself, should be immediately acceptable to anyone of a libertarian bent. Libertarians, particularly of the deontological variety, are often very quick to argue that market inefficiency does not, by itself, morally justify intervention. Satz is arguing from the opposite side of the field - she contends that markets operating efficiently does not morally rule out intervention. The question, then, is a matter of what moral system should be used to make that kind of decision.